Tag Archives: Peru

Peru – Peru Offers Reward for Arrest of Former President Toledo

One of the topics I return to most on this blog is probably corruption and specifically, corruption in the president’s office. The last number of years has witnessed a veritable landslide of corruption cases by those occupying the highest political office across Latin America. Guatemalan ex-President Alfonso Portillo was sentenced to five years in prison in the US for taking bribes from Taiwan. Another former Guatemalan president, Otto Pérez Molina, is currently in Matamoros prison in Guatemala City, serving a sentence for receiving bribes from importers. In El Salvador, evidence emerged linking former president Francisco Flores to illegal and hidden bank accounts. Argentine Vice-President, Amado Boudou, has appeared in court to respond to allegations that he illegally halted bankruptcy proceedings against a company that he supposedly had an interest in. In Mexico, Angélica Rivera, the wife of president Enrqiue Peña Nieto, has become embroiled in a scandal concerning a mansion she purchased in 2012, and Grupo Higa, a government contractor. In Peru, questions have been raised about the manner in which former president, Ollanta Humala, funded his presidential election campaigns in 2006 and 2011. And of course most famously, only last year, Dilma Rousseff, the embattled former President of Brazil was forced out of office partly as a consequence of the huge Lavo Jato corruption scandal which engulfed the Brazilian political establishment, which has also involved allegations of kickbacks from the Brazilian construction giant, Odebrecht, to former president, Luiz Inácio Lula da Silva.

Well now it seems the fallout from that crisis is spreading. Apparently, Odebrecht’s chief executive in Peru, Jorge Barata, told Peruvian investigators that Alejandro Toledo, the former president of Peru between 2001 and 2006, received US$20 million in bribes from Odebrecht in return for granting them the contract to build a large road and infrastructure project. Toledo has been under investigation in Peru since 2013, after his mother-in-law supposedly bought a number of expensive houses via offshore companies that seemed to extend significantly beyond the family’s means.

Somewhat ironically, Toledo came to power in 2001 in the tumultuous aftermath of the resignation of Alberto Fujimori, partly by railing against the corruption scandal engulfing Peru at that time following the discovery of videos of Peru’s head of intelligence, Vladimiro Montesinos, bribing TV network executives. Toledo was in France when this news broke and is now thought to be in California, where he currently holds a visiting professorship at Stanford University. Peru has now offered a 100,000 soles award (approximately US$30,000) for information leading to his arrest and current Peruvian president, Pedro Pablo Kuczynski, has asked Donald Trump to arrest and extradite Toledo back to Peru.

But this scandal looks set to explode to other presidencies. Apparently, Obebrecht had a designated department to bribe governments across the world in return for state building contracts. The presidency of Alan García (2006-2011) is now also falling under suspicion, given that Odebrecht won a record number of contracts in Peru during his tenure and allegations have also surfaced that Colombian president, Juan Manuel Santos, received illegal campaign donations from Obebrecht.

But why such persistent and prevalent cases of corruption in the very highest political offices? Explanations range from the historical development of the state and Guillermo O’Donnell’s infamous ‘brown areas’, to the lack of transparency during the economic reform process of the 1980s and 1990s, to the combination of presidentialism and the PR electoral system, a variant of which most Latin American countries employ.[1] Of course, while this type of graft is a problem in most other regions of the world, what makes the Latin American case particularly interesting is the often very public judicial and legislative battles to bring this wrongdoing to heel. It seems likely that the Obebrecht case is only going to inspire more of these.

[1] See For example, some of the chapters in Walter Little and Eduardo Posada-Carbó (eds.) 1996. Political Corruption in Europe and Latin America. Palgrave Macmillan or Jana Kunicová and Susan Rose-Ackerman. 2005. Electoral Rules and Constitutional Structures as Constraints on Corruption. British Journal of Political Science, 35: 573-606.

Chris O’Connell – Late Turnaround in Peruvian Presidential Election Gifts Presidency to Kuczynski

This is a guest post by Chris O’Connell, PhD candidate in the School of Law and Government at Dublin City University

Barring an unlikely result from the remaining three per cent of votes yet to be counted, Pedro Pablo Kuczynski will become the next President of Peru, thereby completing a remarkable comeback. Yet Kuczynski (or ‘PPK’ as he is known), can count himself exceedingly lucky: not only did he claim victory by the narrowest of margins imaginable over his rival Keiko Fujimori, but the final week’s dramatic turnaround had little to do with his own performance.

The results to hand with 97 per cent of the votes counted give Kuczynski 50.15 per cent of the vote to Fujimori’s 49.85 per cent – a winning margin of 0.3 per cent. Put another way, the presidency of a country with a population over 30 million has been decided by a mere fifty thousand votes. The remaining votes to be counted comprise citizens living abroad along with some districts of the south, both of which are expected to favour PPK.

As I wrote previously in this blog, the first round of voting in Peru’s presidential election witnessed a series of dramatic events including the dubious exclusion of two strong candidates – Cesar Acuña and Julio Guzman – and the re-constitution of the left, primarily in the guise of the Broad Front’s candidate, Veronika Mendoza. Nevertheless, the results gave us two familiar faces – Kuczynski and Fujimori – in the run-off vote.

Fujimori was the clear winner of the first round with 40 per cent of the vote, giving her a strong lead over PPK, who managed a mere 21 per cent. In spite of this large margin, Kuczynski and his supporters could take comfort from comparative data which shows that of the 44 run-off elections in Latin America between 1978 and 2015, 11 were won by the runner-up in the first round[i]. Peruvian examples of such reversals also exist, such as Alan Garcia’s victory over Ollanta Humala in 2006[ii], and indeed the initial triumph of Alberto Fujimori in 1990. Neither, however, faced anything like the deficit confronting PPK.

As outlined in my previous blog, the challenge for Kuczynski in the second round was twofold: to garner a significant amount of the leftist and anti-establishment votes that went to Mendoza and others; and to effectively present himself as the “anti-Fujimori” candidate. But opinion polls carried out just a week before the election uniformly giving a six-point lead for Keiko indicated that he was failing on both fronts. Significantly, those polls also showed that over 13 per cent of the electorate had yet to decide which way to vote.

Perhaps PPK’s inability to connect with Mendoza’s base was not a surprise. As a former Wall Street banker and World Bank economist he is inextricably linked to Peru’s existing neoliberal economic model; and as a former Prime Minister and Economics Minister, he is also closely associated with the political establishment. His seeming inability to tap into the strong public sentiment of ‘anti-fujimorismo’ – encapsulated by his diffident performance in the first presidential debate – was harder to explain.

But both these elements were to swing firmly in Kuczynski’s favour in the final week of the campaign, even if his own part in them was arguably the least significant. Nonetheless, a notably more aggressive performance in the second debate coupled with a series of attacks on ‘fujimorismo’ gave his campaign a much-needed injection of energy.

But it is likely that events over which he had no control played an even greater role in handing victory to Kuczynski. Galvanised by the apparent inevitability of a Keiko victory, the twin currents of leftism and ‘anti-fujimorismo’ were channeled into support for PPK. A huge national protest on May 31st by the ‘Keiko no va!’ (Keiko no way!) campaign coincided with a message on You Tube from Mendoza, urging her supporters in both Spanish and Quechua to support Kuczynski as the only way to halt Fujimori.

A review of the geographic spread of votes indicates that this support played a significant role in deciding the presidency. Kuczynski’s success in the south of Peru – including a thumping victory in Mendoza’s home state of Cuzco – along with victory in the anti-mining hot spot of Cajamarca, are clear evidence that PPK benefited from the left-leaning votes that had gone to Mendoza and others in the first round.

Equally significant was the succession of scandals which encircled Fujimori’s Popular Force party in the final weeks of the campaign. The revelation that the party’s general secretary, Joaquin Ramirez, was under investigation by the US Drug Enforcement Agency (DEA) for alleged money-laundering and drug offences, while harmful, did not at first appear to fatally damage Keiko’s campaign. Attempts by her running-mate Jose Chlimper to discredit those charges by releasing audio tapes that were proven to have been doctored, however, served to widen and prolong the scandal.

The nature of the allegations and attempted cover-up undoubtedly evoked memories of the corrupt and authoritarian regime of Keiko’s father Alberto in the minds of many voters. Furthermore, Keiko’s reluctance to distance herself from either man (although Ramirez was eventually suspended), or to clearly answer questions about her campaign finances, threw doubt on her claims to have cut ties to the past and forged a new, democratic party. Instead PPK was belatedly able to accuse the party of planning to turn Peru into a ‘narco-state’.

Regardless of how it came about, this victory nonetheless represents a stunning turnaround, and a shocking defeat for Fujimori[iii]. Nevertheless, it does appear that this was an election not so much won by Kuczynski as handed to him by a combination of Mendoza’s instrumental support and Fujimori’s shortcomings. This in turn will have considerable implications for the incoming government.

PPK will assume the presidency with the narrowest of mandates, with a polarised electorate and facing an array of political obstacles. In particular, the presence of a huge ‘fujimorista’ bloc in Congress, where they hold 73 of the 130 seats, appears to hold out the possibility of executive-legislative deadlock. Kuczynski’s own party hold just 18 seats, forcing him to seek support from others.

Mendoza’s message, however, makes it clear that the support from the Broad Front was purely to stop Fujimori, and PPK is unlikely to be able to continue counting on those ‘borrowed’ votes. The kind of political and environmental reforms sought by Mendoza’s party are unlikely to be looked upon favourably by highly influential business and mining lobbies that have provided backing to his candidacy[iv].

Another option for PPK is to forge some kind of coalition with Fujimori’s Popular Force party. A deal with the ‘fujimoristas’ comes with its own set of political risks, and would appear counter-intuitive given how decisive the anti-Fujimori vote proved in getting him elected. That path risks a popular backlash as well as strengthening a resurgent left.

But if the recent political history of Peru teaches us anything is that electoral promises are quickly forgotten. Furthermore, the similarities between the offerings of PPK and Fujimori are striking, with both favouring the continuance of the existing economic model, including its dependence on mining. Indeed, part of the problem for Kuczynski during the second-round campaign came from differentiating his programme from that of his rival.

Thus the most likely outcome is that PPK will follow the path of his immediate predecessors in combining continuity in the economic sphere with low public approval and deepened disenchantment with the political game.

Notes

[i] See article from Daniel Zovatto at the Brookings Institute, available online at: http://www.brookings.edu/research/opinions/2016/04/24-peru-election-zovatto

[ii] McClintock, Cythia, 2006. “An Unlikely Comeback in Peru.” Journal of Democracy Vol. 17.4.

[iii] The near-catatonic reaction of political analyst Ricardo Vasquez Kunze live on TV Peru has been cited as an example of the shock felt by some.

[iv] See articles by Francisco Durand regarding the political influence of the business lobby: Durand (2002) “Business and the Crisis of Peruvian Democracy” Business and Politics Vol. 4.3; Durand (2010) “Empresarios a la Presidencia” Nueva Sociedad Vol. 225.

Chris O’Connell is a PhD candidate in politics at Dublin City University, where he has lectured on Latin American politics. He holds a BCL from University College Cork, and an MA in Development from DCU. Currently he is writing his doctoral thesis on the influence of civil society on populist presidents in Bolivia, Ecuador and Peru. His research interests centre on the politics of development in Latin America.

Chris O’Connell – In Peru A Dramatic Election Ends With A Predictable Result

The first round of voting in Peru’s presidential election ended in the result that many commentators had long predicted: a run-off vote between two familiar faces in Peruvian politics: Keiko Fujimori and Pedro Pablo Kuczynski. While the final result may have been foreseeable, the events leading up to it – which included the questionable exclusion of two candidates, the (possible) return of the left, a transnational protest movement, and a significant intervention from a prison cell – were a constant source of surprise.

The result itself saw the established front-runner, Keiko Fujimori, garner 40 per cent of the vote, insufficient to avoid a run-off contest. Keiko is of course the daughter of disgraced former President Alberto Fujimori, for whom she acted as First Lady in the 1990s. Keiko ran for the presidency herself in 2011, losing out to incumbent Ollanta Humala in a run-off. The runner-up with 21 per cent was former World Bank economist Pedro Pablo Kuczynski, another who also ran in 2011. Kuczynski, or ‘PPK’ as he is known, served as both prime minister and Minister of Economy and Finance in the government of President Alejandro Toledo.

The result, however, is only one part of the story of this election. David Doyle has written previously in this blog about the controversy over alleged plagiarism involving a leading candidate in the election, Cesar Acuña. In the end, Peru’s national elections committee did disqualify Acuña, but on the basis of breaching a law that outlaws the making of payments in return for votes, a charge the Alliance for Progress candidate denies. A similar allegation against Keiko Fujimori for handing out prizes at a dance competition was not upheld, however.

Even more controversial was the subsequent removal of another candidate, Julio Guzman, this time due to technical irregularities in the registration of his candidacy. The dubious exclusion of Guzman – a former Inter-American Development Bank economist who had risen to second in the polls – attracted widespread international condemnation. Nevertheless, appeals by both Acuña and Guzman proved fruitless, leading The Economist to describe the electoral process as a “dangerous farce”.

The logical beneficiary of the exclusion of Guzman, was his fellow economist Kuczynski. Indeed polling in the immediate aftermath of the decision indicated that PPK had increased his vote share by over ten per cent, pushing him into second place. Rather than build on this stroke of luck, Kuczynski’s numbers stalled, then declined. While this may be explained to some degree by what is viewed as a lacklustre campaign, it also highlights a recurring trend in Peruvian politics: the desire for change.

An opinion poll carried out by the Catholic University’s Institute of Public Opinion (IOP) on the eve of the election demonstrates that the clamour for alternatives not only remained strong but even grew since 2011. According to the survey, 76 per cent of the electorate favour a change to the prevailing neoliberal economic model. Of those, 40 per cent desire “radical changes”, up from 33 per cent in 2011. Furthermore, the same poll indicates that 52 per cent of Peruvians favour increased state intervention, a ten per cent increase from five years earlier.

This data must be considered in the wider regional context. Scholars of Latin American populism have identified certain permissive conditions for its emergence, among them a weak, inchoate political party system, and an absence of faith in political institutions. A further contributory factor, according to Barr, is the location of a candidate with regard to the political establishment.[i] These candidates are typically referred to as ‘outsiders’, but may also be described as ‘populist’ or ‘anti-establishment’.

Peruvian politics appears to meet the criteria for the emergence of outsider candidates. While there is widespread distrust in politicians and political parties across Latin America[ii], Peru routinely achieves among the lowest rankings in the region. Furthermore, as scholars such as John Crabtree, Steven Levitsky and Maxwell Cameron have written, Peru’s party system is particularly weak and fragmented[iii].

In other words, political space exists for a candidate from outside the establishment to tap into the strong public desire for change. Both Acuña and Guzman succeeded in capturing this support, albeit briefly, before their respective exclusions. Their absence opened up the field for other candidates in the same mould. In the case of this election, that meant Alfredo Barnechea and, in particular, Veronika Mendoza.

Elected to Congress in 2011 for Humala’s ‘Peru Wins’ party, Mendoza broke away in 2012 due to opposition to the government’s stance on mining. Peru’s economy depends disproportionately on its mineral wealth, and the mining lobby exerts significant political influence. Mendoza helped form a leftist party, the Broad Front, which campaigned on a platform of social reform, and increased State control over natural resources. Analysts, however, gave Mendoza little chance of success, with polls conducted a month before the election giving her little over seven per cent support.

The situation changed dramatically in the weeks before the election. While Mendoza undoubtedly benefited from the exclusion of Acuña and Guzman, her rise arguably owed more to the effectiveness of her campaign, which contrasted with that of Kuczynski. Taking a leaf from the populist playbook, Mendoza criss-crossed the country holding rallies and personally connecting with voters. Mendoza’s discourse, however, was far from populist, as she maintained a coherent left-wing message. This was allied to a moderate public persona, even in the face of media attacks[iv].

Despite having all of the momentum in the last weeks of the campaign, Mendoza ultimately fell short, receiving 19 per cent of the vote. This can be explained by a number of factors, all of which are recurring themes in Peruvian politics. The first concerns the role of the media, which many on the left in particular consider guilty of right-wing bias. While the control of over 80 per cent of all media by the ‘El Comercio’ group of companies is startling, in the particular context of this election it appears that other factors were more significant.

One such factor is the long-standing issue of divisions within the Peruvian left.[v] The presence on the ballot of the imprisoned candidate of the Direct Democracy party, Gregorio Santos, was especially important. Santos, the former Regional President of the Cajamarca region and anti-mining activist held under preventative detention relating to corruption charges, made a dramatic contribution to the presidential debate from his prison cell. The four percentage points garnered by Santos – had they gone instead to Mendoza – would have been sufficient to edge out Kuczynski.

The remaining factor that militated against Mendoza was the strong strain in Peruvian politics of ‘anti-fujimorismo’ (opposition to Fujimori). The legacy of Fujimori Senior continues to divide Peruvian society, in spite of his ongoing incarceration for a combination of human rights violations and embezzlement.

The run-up to this election saw a series of protests, culminating on the 5th of April with tens of thousands proclaiming ‘Keiko no va!’ (Keiko no way!) in rallies across Peru, as well as in Paris, New York, Rio and Buenos Aires. Kuczynski, aided by polls that named him as the candidate most likely to defeat Keiko in a run-off, appears to have benefited from tactical anti-Fujimori voting, gaining around eight percentage points in the last days of the campaign.

What does all of this mean for the run-off vote, scheduled to take place on the 5th of June? Much will depend on which candidate will be able to attract the mix of left-wing and anti-establishment votes that went to Mendoza, Barnechea and Santos. This will not be easy for either candidate, both of whom are closely associated with not only with neoliberal economic policies, but also the political establishment.

Fujimori is the obvious favourite, having received almost twice as many votes as Kuczynski. Furthermore, Keiko appears to have learned lessons from her failed campaign in 2011. Beginning with a speech at Harvard University in October 2015, Keiko has distanced herself from the “errors” of her father’s regime, and vowed to respect democracy. She has dispensed with several members of her party with close associations to that time, such as Martha Chavez, and pledged not to pardon Fujimori Senior if elected president. We can expect more in way of such moderation in the coming months. Whether it will be enough to convince a further ten per cent of the electorate remains to be seen.

The challenge for Kuczynski is significantly greater, and not only mathematically. Like Keiko, PPK has also been attempting to right the wrongs of his last campaign, appearing in the media to talk up his ‘socialist’ credentials. Kuczynski’s status as the clear preference of powerful business interests, however, will not help him to convince voters that he will bring about fundamental changes.

Instead Kuczynski’s best bet would appear to be to present himself as the ‘non-Fujimori’ candidate. This may well be sufficient to swing the election his way, provided he can avoid glaring gaffes. It would be a considerable boon to Kuczynski if he could bring on board at least some elements of the left. The candidate himself appears to recognize this, as within days of the first round vote Kuczynski had announced plans to meet with Santos.

Nevertheless, Kuczynski faces an uphill battle. A national survey carried out by the IOP in March indicates that crime is overwhelmingly the most pressing issue for citizens across the social spectrum.  While the name ‘Alberto Fujimori’ may hold a variety of mainly negative connotations for social scientists, for many ordinary Peruvians it is synonymous with law and order, a factor which may well give his daughter the edge in June.

Notes

[i] See Barr, 2009. “Populists, outsiders and anti-establishment politics.” Party Politics Vol. 15.1.

[ii] See Latinobarómetro Report, 2015.

[iii] See Crabtree, 2010. “Democracy without parties? Some lessons from Peru.” Journal of Latin American Studies Vol. 42.2; Levitsky & Cameron, 2003. “Democracy without parties? Political parties and regime change in Fujimori’s Peru.” Latin American Politics and Society Vol. 45.3.

[iv] Mendoza’s dignified but ruthless decimation of television pundit Aldo Mariátegui particularly stands out.

[v] See Tanaka, 2008. “The Left in Peru: Plenty of Wagons and No Locomotion”, in Jorge G. Castañeda and Marco A. Morales, eds. Leftovers: Tales of the two Latin American lefts.

Chris O’Connell is a PhD candidate in politics at Dublin City University, where he has lectured on Latin American politics. He holds a BCL from University College Cork, and an MA in Development from DCU. Currently he is writing his doctoral thesis on the influence of civil society on populist presidents in Bolivia, Ecuador and Peru. His research interests centre on the politics of development in Latin America.

Peru – Congress (finally) ratifies Humala’s new cabinet

Last Tuesday, Peru’s congress approved President Ollanta Humala’s proposed new cabinet.[1] However, this was the third time that Congress voted on this issue, and it was a very close call: 55-54 in favor, with nine abstentions. Somewhat dramatically, Humala’s cabinet was only saved by Ana María Solórzano, the President of Congress, who was the last to vote and tipped the balance in favor of the government.

Humala and his party, Gana Perú, do not have a majority in the legislature, and the government has been relying on the support of a number of smaller parties, primarily comprised of a conservative block of legislators, affiliated with former presidential candidate Pedro Pablo Kuczynski, for their legislative initiatives. However, support for the government has haemorrhaged following the stagnation of the economy, and amidst criticism of prominent members of Humala’s cabinet.

The new cabinet, to be led by Ana Jara Velásquez, only managed to receive approval third time round because the embattled Humala agreed to suspend new rules for private pension funds and withdraw his nominee for the Organization of American States (OAS). The weakness of Humala’s government is evident. This is Humala’s sixth cabinet and his last President of the Council of Ministers was only approved on the third vote. This was the first time in ten years that Congress has refused to ratify the president’s cabinet.

This conflict between the legislative and executive branch provides us with an important insight into the variation in regime type across Latin America. There is a general tendency for people to treat all Spanish-speaking South American democracies (and Brazil) as pure-presidential. This however, is not accurate. At least one democracy in South America is a hybrid regime – Peru. Argentina is a possible second although this is a slightly more contentious case (see this discussion over at the Semi-Presidential One). In fact, Peru is what David Samuels and Matthew Shugart class as ‘president-parliamentary’, that is when the prime minister and the cabinet are dually accountable to the president and assembly majority (p. 30).[2]

The current conflict in Peru revolves around the legislature’s refusal to approve the Presidente del Consejo de Ministros (or President of the Council of Ministers), in this instance, the aforementioned Ana Jara Velásquez. To all intents and purposes, this position is akin to a prime minister, and together with the cabinet is ‘dually accountable’ to the president and Congress. Clearly, given it was ten years since the last time Congress refused to accept the president’s cabinet, this rarely occurs, but that misses the point. It can happen, as constitutionally, the prime minister and cabinet are accountable to the legislature and so this is an important distinction between Peru and pure-presidential regimes, because in the Peruvian case, this confidence vote places Congress in a powerful position, particularly in the context of a weak and unpopular president.

Although Humala has a fixed term, the refusal of Congress to ratify his cabinet further undermines his political legitimacy and weakens his popular support. This leaves Humala looking like a lame duck.

[1] Thanks to John Carey for suggesting this post and highlighting the importance of the confidence vote in Peru.

[2] David Samuels and Matthew Shugart. 2010. How the Separation of Powers Affects Party Organization and Behavior. Cambridge University Press.

Peru – New Prime Minister and Cabinet Reshuffle

Previously on this blog, I have discussed the Peruvian political tradition of frequent cabinet reshuffles. Well, it continues apace. On Monday, the Peruvian Prime Minister, César Villanueva, tendered his resignation in Latin America’s only semi-presidential regime, just four months after his appointment by President Ollanta Humala. Villanueva was Humala’s fourth prime minister since he became President in July 2011, and his resignation this week precipitated yet another reorganization of Humala’s cabinet.

Villanueva’s departure appears to be the result of a disagreement he had with the Finance Minister, Luis Miguel Castilla, over increasing the minimum wage. Last week, Villanueva publicly floated the possibility of the government raising the floor of the minimum wage in Peru, but a couple of days later, Castilla rejected Villanueva’s statement, and insisted the government was not planning any changes to the minimum wage. What is more, the First Lady of Peru, Nadine Heredia, also publicly contradicted Villanueva, and re-iterated Castilla’s denial.

When he arrived in office, Humala, elected on a vaguely left-leaning, economic nationalist platform, raised Peru’s minimum wage to 750 soles (US$268) a month. However, given the recent slow-down in economic growth, and an increasingly unhappy and fractious private sector, particularly the all-important mining industry, an increase in the minimum wage right now would be too politically costly for Humala.

Consequently, Villanueva’s statement received no support from Humala’s inner circle, and he was left with little choice but to tender his resignation. In his stead, Humala has appointed René Cornejo, previously Minister of Housing. Cornejo is Humala’s fifth prime minister.

At the same time, Humala replaced a further seven cabinet ministers. Ana Jara, formerly Minister of Women and Vulnerable Populations became Minister of Labor; Carmen Omonte replaced her. The former Minister of Agriculture, Milton Von Hesse, was made Minister of Housing, while Juan Manuel Benítez Ramos became the new Minister of Agriculture. In addition, Paola Bustamante was appointed Minister of Development and Social Inclusion; and Piero Ghezzi Solis is the new Minister of Production.

Apparently, Luis Miguel Castilla also offered his resignation to Humala this week. Nonetheless, he retains his post, perhaps no surprise given Castilla’s importance as a signal of economic stability and orthodoxy. However, Humala did accept the resignation of Jorge Merino, formerly the Minister of Energy and Mines. Eleodoro Mayorga Alba replaced Merino.

 

Peru – Humala reshuffles cabinet and appoints new prime minister

President Ollanta Humala of Peru, Spanish-speaking Latin America’s only semi-presidential regime, has maintained the Peruvian tradition of frequently reshuffling the cabinet. Last Tuesday, Humala, elected on the back of a campaign rooted in economic nationalism, requested the resignation of his current prime minister, Juan Jiménez, thereby marking the resignation of Humala’s third prime minister since he took office in July 2011.

In his stead, Humala has appointed Cesar Villanueva, the regional president of the northern department of San Martín. Humala also replaced Education Minister Patricia Salas with Jaime Saavedra-Chanduvi, the acting vice president for poverty reduction and economic management at the World Bank.

The move, coming a month before the traditional December reshuffle, has been interpreted as a signal to placate the mining industry and investors frustrated by slow economic and regulatory reforms and a weakening export sector. It is hoped that Villaneuva, from the center-left, and with a record of brokering political deals, can establish peace between the government and a number of recalcitrant political opponents, opposed to continued expansion of mining in the Andes. The Finance Minister, Luis Miguel Castilla, favored by business, who has been in office since Humala took power, has remained in place.

Jiménez had also been criticized for his apparent lack of concern regarding crime in Peru. With Humala’s popularity at its nadir, and with crime the issue of most concern to the Peruvian electorate, it is no surprise that one of Villaneuva’s first speeches stressed the importance of establishing a united political front in the face of increasing crime and delinquency.

This reshuffle suggests that the Humala government will remain resolutely economically orthodox. Humala, previously a left-leaning radical, was viewed as an economic nationalist on the left of the political spectrum during the 2011 election, but once in power, he distanced himself from indigenous communities, which he had previously courted, and supported the interests of the mining sector in Peru, a country with eye-wateringly high levels of inequality. This political re-alignment was cemented following massive anti-mining protests in 2011, which prompted Humala to shift to the right and adopt a hardline stance towards the protesters.

The appointment of Villaneauva suggests a move towards the political center.