Crisis in Peru: The interplay between COVID and Corruption

Crisis in Peru: The interplay between COVID and Corruption

Peru is in the throes of a political crisis following the outbreak of protests after the impeachment of now former President Martín Vizcarra, ostensibly due to corruption during his time as Governor of the province of Moquegua between 2011 and 2014. The protestors see Vizcarra’s impeachment as politically motivated, carried out to halt the anti-graft initiatives he sought to implement; the protests have also been inflamed by alleged police brutality that led to the deaths of 2 demonstrators. It is likely that some concession by the government will be made in order to defuse this tension.

Following Vizcarra’s impeachment on 9th November, Speaker of Congress Manuel Merino assumed the presidency. Nevertheless Merino announced his resignation on 15th November, less than 5 days since taking office, following the death of 2 students in the midst of a police crackdown on the continued protests against Vizcarra’s impeachment; pressure on Merino to resign increased after 13 of his Cabinet’s 18 ministers resigned in protest against these deaths and the police response to the demonstrations. Responding to Merino’s resignation, Peru’s Congress returned to deliberations, ultimately voting 97-26 in favour of electing Francisco Sagasti of Partido Morado as interim President the following day. 

COVID’s role in the crisis

The ongoing COVID-19 pandemic almost certainly played a role in bringing about the recent unrest in Peru. The country has had more coronavirus deaths per million people than other countries in the region like Brazil, Colombia, Argentina and Bolivia. The pandemic and lockdown measures against it have led to a significant contraction in the country’s economy of around 30.2% in the second quarter of this year. Consequently, aside from the corruption allegations against him, Vizcarra’s opponents in Congress also seized upon these statistics as justification for his impeachment. It is likely that the COVID-19 pandemic also played a role in spurring the protests against Congress’ decision; with an estimated unemployment rate of approximately 17.1% as of this October it is not unreasonable to hypothesise that many Peruvians, particularly among the younger generation, had both the time and motivation to express their frustration towards the country’s politicians.

What can we expect from Sagasti’s appointment?

In the short term, Sagasti’s appointment is likely to help stabilise Peru’s financial situation, such as the state of its currency and sovereign bonds. This is in part due to the aforementioned higher likelihood he will remain interim President longer than his predecessor, but also due to his background; among other things, Sagasti has experience as Chief of the Strategic Planning Division of the World Bank and in work in numerous different organisations on national development, making it more likely that he will be able to encourage international investor confidence and manoeuvre Peru’s financial situation.  

Sagasti’s appointment is also likely to calm the protests against Vizcarra’s impeachment; crowds in Lima cheered after his appointment was finalised. The reaction to Sagasti was more positive than that towards Merino for reasons including the fact that he and Partido Morado were among the few who voted against Vizcarra’s impeachment. The legitimacy lent to Sagasti and his party by that fact make it likely that he will remain as interim President until the end of the current government’s mandate in July 2021. Even so, unrest remains among a wide swathe of Peruvian society upset by Vizcarra’s impeachment, political corruption and police violence; in order for Sagasti to ensure the stability both of his position as interim President and of Peru’s economy and society more broadly, initiatives will have to be taken to address these issues. Sagasti appears to understand this, having already spoken of his intention to continue fighting against corruption and move towards reforms in the National Police.

It is necessary to bear in mind, however, that Sagasti is unlikely to be able to achieve any significant resolution to Peru’s economic and political problems. After all, with only 8 months in office and the immediate crises of COVID-19 and economic recession to contend with, it is likely that the challenge of pushing through anti-corruption reforms and restoring Peruvians’ faith in Congress will fall to the next President. For this reason Sagasti’s administration is likely to focus on creating the environment for a smooth political transition and confronting these immediate concerns.

The Longer Term

Over the long term, a proper resolution to Peru’s political crisis is likely to necessitate deep and comprehensive reforms. The need for such changes becomes all the more apparent in the face of recent survey results which indicate a disapproval rate towards Congress of 90%, up from 65% in October. In the face of this growing dissatisfaction, it is quite possible that over the next few years calls will grow from the public and Peruvian opposition groups for changes to the country’s Constitution in order to definitively enshrine anti-corruption measures and establish checks and balances to prevent questionably motivated incidents like Vizcarra’s impeachment from re-occurring. In fact, such calls have already been voiced; Veronika Mendoza of Nuevo Perú has brought up the possibility of arranging a public consultation next year to gauge support for a new Constitution. With Chile already in the middle of pursuing Constitutional reform it is likely that Peru’s reforms will follow a similar path, particularly if Chile’s reforms go smoothly.

If Sagasti is able to effectively manage the transitional government it is likely to prove advantageous for Julio Guzmán, who is likely to represent Partido Morado in the 2021 elections. It is also possible that if Vizcarra’s impeachment is found to be illegitimate, he may be able to compete in the next elections; given his popularity, it is likely that he would stand a good chance of victory. Either way, the next President of Peru is likely to be from one of the newer centrist political groupings like Partido Morado or an independent like Vizcarra given the political damage self-inflicted by Peru’s larger parties like Acción Popular and Fuerza Popular in the face of their support for Vizcarra’s impeachment.

Categories: Latin America, Politics

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