Peru – President Pedro Pablo Kuczynski Resigns

The President of Peru, Pedro Pablo Kuczynski, resigned on Wednesday in the wake of allegations of vote buying and a larger existential threat to his leadership from the Odebrecht scandal.  He was facing an impeachment vote on Firday of this week in Congress, but party leaders have agreed to accept his resignation, which will prevent this vote from going ahead.

President Kuczynski had become entangled in the wider Odebrecht scandal that has engulfed Latin American politicians across the region. The tentacles of the Odebrecht scandal had already reached Peru, where former president, Alejandro Toledo (2001-2006), has been accused of receiving US$20 million in bribes from Odebrecht in return for granting them the contract to build a large road and infrastructure project. The presidency of Alan García (2006-2011) also fell under suspicion, given that Obebrecht won a record number of contracts in Peru during his tenure. Last year, President Kuczynski had been accused of receiving US$782,000 from Odebrecht through a company that he owned. He has admitted he received the money, but insists it was above board.

As a consequence, he was accused of being “morally unfit” to be president and he faced an impeachment vote in Congress in December of last year. Over 87 votes were needed to impeach him, but the motion, although supported by 78 against 19, did not pass. But a cloud hung over this vote. One of President Kuczynski’s main opponents in Congress has been the right-leaning Keiko Fujimori, the daughter of the former President, Alberto Fujimori, who is currently serving a 25-year sentence for corruption and human rights abuses. Keiko’s increasing power in Congress has placed significant pressure on Kuczynski and her party, Fuerza Popular, has been the main activist behind each impeachment vote. In the December vote however, her brother, Kenji Fujimori, defied his sister by leading a small group of rebellious Fuerza Popular legislators to block the impeachment vote against Kuczynski. A few days later, President Kuczynski pardoned Alberto Fujimori.

On Tuesday night, the fate of President Kuczynski was sealed. Videos emerged, released by Fuerza Popular, which purportedly show the President’s allies offering legislators a share of key public work programs, in addition to access to various government prerogatives, in return for their support in the impeachment vote scheduled for this Friday. Although Kuczynski has alleged that the tapes were heavily edited, already daunted by the prospect of a hostile Congress this Friday, this appeared to the final nail in the coffin of his political career and after just 19 months in office, he resigned on Wednesday.

And so Kuczynski becomes another victim of the Odebrecht scandal. Centered on the Lavo Jato corruption scandal, it has its roots in bribes given to Brazilian politicians (and elsewhere) by the Brazilian construction giant, Odebrecht, in addition to other construction companies, in return for a whole gamut of favors. In fact, Odebrecht has admitted to paying over US$1 billion in bribes and apparently, they even had a designated department whose sole function was to bribe governments across the region in return for state building contracts.

The scandal has also dragged other Latin American executives into its orbit. It was partly responsible for forcing Dilma Rousseff, the former president of Brazil, out of office. In Panama, prosecutors are now seeking to detain the sons of former president, Ricardo Martinelli (2009-2014). Ricardo Alberto and Luis Enrique Martinelli are accused of depositing part of a US$22 million bribe that Odebrecht paid in return for lucrative state contracts in Panama. And current Panamanian president, Juan Carlos Varela, has been accused by a former advisor of receiving political donations from Odebrecht. In Colombia, a former senator who admitted receiving bribes from Odebrecht has accused current Colombian president, Juan Manuel Santos, of receiving illegal campaign donations from the Brazilian firm and in Argentina, members of Mauricio Macri’s centre-right organization have been accused of ties with Odebrecht, and in the case of Gustavo Arribas, of accepting a direct bribe from the firm. In the Dominican Republic, the Brazilian firm admitted that it payed US$92 million in bribes to Dominican government officials to secure large and lucrative infrastructure projects.

In Peru, the former President, Alejandro Toledo, who is also facing prosecution for his dealings with Odebrecht, is currently on the run. This led to the Peruvian government offering a 100,000 soles award (approximately US$30,000) for information leading to Toledo’s arrest.

Undoubtedly, the Odebrecht scandal will rumble on and drag many more politicians into its wake.

Given the line of succession outlined in the Constitution of Peru, the Vice-President, Martin Vizcarra, will now become acting president.

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