Brazilian President Dilma Rousseff was re-elected by a thin margin in a run-off vote on Sunday in what was the closest election campaign since democracy was restored in the country 30 years ago.

With 99% of the votes counted, leftist Rouseff won 51.6% in the race against centrist Aecio Neves, a senator from the Social Democracy party, who won 48.4%. The result showed votes were almost evenly split between pro-Rouseff impoverished northeast and Amazon north and pro-Neves richer south, southeast and centre-west.

She received about 41% in the first round, while Neves was second with slightly more than 33%.

Since 2003, Rouseff’s Workers' Party has lifted 40 million people from extreme poverty and hunger and cut jobless rate to record lows, but her economic policies have led to slow economic growth and a recession this year after a spectacular rise last decade.

Despite high inflation and a corruption scandal Rouseff won the race riding on a wave of warnings to voters during her election campaign that a victory for Neves would mean a return to the inequality and less generous social welfare programmes of the 1990s. The Workers Party’s social programes have helped to reduce poverty by 55 percent since 2003.

In a televised speech, Neves conceded defeat and congratulated Rouseff for her victory. In her speech she said she is open to dialogue.

Rousseff paid tribute to her political mentor and predecessor Luiz Inacio Lula daSilva, who was president for eight years before Rouseff and whose social reforms were continued under her government and were the basis for her re-election.

Now Rousseff is facing challenges from international markets, which are nervous about the high level of government intervention in the economy, as well as from Brazilians who demand improved health and education services and a crackdown on crime.