After a decade of leading Latin America in economic growth, the current Peruvian presidential election has the potential to derail or even reverse the country’s progress. Only a deeper understanding of the candidates and the clarification of a few misunderstandings will secure socioeconomic stability for years to come.
For Peru, the 1990's were marked by the Shining Path and Tupac Amaru terrorist movements, a stagnant economy, hyperinflation, and the Fujimori dictatorship. Post-millennial Peru told a far more positive story, in which the proverbial stars aligned: two subsequent stable governments led by Presidents Toledo and García, a commodity boom, successful free trade agreements, and an investment grade rating. As a result, the Peruvian economy has been outpacing its Latin American counterparts in terms of average GDP year-on-year growth rates (4%+ from 2001 to 2005 and 7%+ for 2005 to the present, according to J.P. Morgan Research from April 1), with $42 billion worth of mining deals in the pipeline, and ongoing investments in infrastructure.
Given these favorable conditions – or better yet, high stakes – the first round of presidential elections held on April 10 were crucial in determining the path of a country that had just seemed to find its economic footing.
The leading candidates were five: Ollanta Humala, a neo-socialist turned political moderate with no government experience; Keiko Fujimori, a populist lawmaker, congresswoman, and daughter of now-jailed former President Alberto Fujimori, who had been implicated in human rights violations; Alejandro Toledo, former President of Peru; Pedro Pablo Kuczynski , the Minister of Economy and subsequent Prime Minister of the former; and Luis Castañeda, former Mayor of Lima.
A post-election poll by Ipsos Apoyo gives the neo-socialist Humala a 27.2% gain, compared with Fujimori’s 20.5%, Toledo’s 18.5%, and Kuczynski’s 18.1%.
But what would possibly compel the Peruvian population to favor the two candidates that received the highest aversion ratings in preliminary polls? And what will determine the outcome of the run-off between Humala and Fujimori? Here are some ideas:
“In the years between 2005 and 2009, the proportion of impoverished Peruvians has dropped from 42% to 35%.”
This is true, but insufficient.The lion’s share of economic benefit being generated by Peru’s recent growth heads in one of two directions: to the Peruvian elite, or toward laying the groundwork to facilitate more economic growth. Sadly, a negligible amount of that growth has been reinvested in their healthcare or in the Peruvian public educational system. This resulted in a mass mobilization of the lower sectors in support of the more populist candidates.
“Humala is more Lula than Chavez.”
This is false. Recently, the Humala’s spin has been more toward that of former President Lula Da Silva of Brazil instead of President Chavez of Venezuela. He has replaced his staple red t-shirt with a suit, and substituted his anti-foreign investment and borderline reverse-racism with more polite and easy to swallow rhetoric – sure. But a closer look at his policies reveals that his stance remains virtually unchanged from his socialist foundation. He still intends to amend the constitution, he still aims to filter the media, and he still hopes to limit foreign investment. Dare we mention expropriation? Beyond that, if elected, he will only hold a first minority in Congress (35%), which would substantially impair his ability to implement change, ultimately making drastic action on his part all the more likely.
“Like father like daughter.”
Not necessarily. The negative connotations of Fujimori’s legacy – the elder Fujimori is currently serving a 25-year sentence for human rights abuses, and is widely suspected of having masterminded a plan to first bribe and then blackmail heads of media;the younger served as his First Lady following his separation from Susana Higuchi and allegedly knew of these abuses – could result in a concerted effort on behalf of the younger Fujimorito clean up the family name, so to speak. As such, we could expect her to stake strong anti-corruption stance and an even stronger position in favor of human rights. Beyond that, her pro-business policies would hopefully perpetuate the level of foreign investment in and the rate of growth of Peru.
In the words of Peruvian Nobel Laureate, Mario Vargas Llosa: the Peruvian people must once again opt between “cancer and AIDs.” The Peruvian government’s single-minded pursuit of economic growth and foreign investment must now make room for another priority:socioeconomic inclusion; lest we end up in yet another tragically polarized election just five years from now, barring any Chavista constitutional amendments, that is.
Photo Credit: Wikimedia Commons