New Prime Minister Takes Top Job In Peru

After a crushing vote of “no confidence” in the Peruvian government, Prime Minister Fernando Zavala has stepped down to make way for his successor, Mercedes Araoz. The no-confidence vote passed last week by a 123-4 margin, prompting Zavala to resign along with the 19 members of his cabinet. Though the president reappointed several of those cabinet members two days later, Zavala has not been welcomed back.

The government’s waning popularity has been particularly difficult for President Pedro Pablo Kaczynski, who is responsible for making new appointments all the chaos. In addition to being Prime Minister, Zavala held the position of Finance Minister, indicating the government’s parlous state of affairs. Kuczynski’s approval rating has dropped to 22 percent after only one year in office.

If anyone can save the president’s standing, it’s Mercedes Araoz, the country’s new prime minister. Currently popular, Araoz takes a more moderate line than her predecessor, which may help her win over the country. She is also well placed to broker compromises with the other major party – the Fuerza Popular – which has been holding Kuczynski’s government to ransom. Holding 71 of Congress’s 130 seats, Fuerza Popular blocked many of Zavala’s measures, handicapping the government during its first year of tenure.

Fuerza Popular is led by Keiko Fujimori – a charismatic leader in Congress whose approval ratings hover around the level of Araoz’s. The change in leadership, however, might force Fujimori to make more compromises to avoid seeming too undemocratic and frustrating the now more popular leader.

However, this is by no means certain. Fuerza Popular holds its mandate on a very different line to the social liberals of Kuczynski’s Peruvians for Change Party. Fujimori claims the government is pro-abortion, too friendly towards the LGBT community and exclusionary of those outside the capital Lima. Fujimori is the daughter of a former Peruvian president who is currently in prison for human rights abuses.

The different lines taken by these two parties clearly shows their latest spat is of international importance. For those watching from abroad, the stability and popularity of a progressive government is of great significance. Peru has not remained unscathed from the corruption scandal ripping through Latin America; just last week a former president was arrested and detained on suspicion of having received $3 million in illegal payments from Brazilian building firm Odebrecht. If the scandal develops in Peru and other senior figures are embroiled, both parties may suffer.

At the moment, Peru is enjoying an expanding economy. With copper prices on the rise, its GDP rose 2.4 percent in the first half of the year. Furthermore, the government has promised to up public spending by 10 percent next year without raising taxes. This promise is sure to be a vote winner, and with Kuczynski’s glowing academic record and hugely successful investment banking career, these might not be empty words. The success of these policies will be enough to make or break this next assemblage of politicians under Kuczynski’s leadership; a liberal and socially inclusive Peru is probably reliant on the maintenance of the current copper prices.

Excluding the possibility of the Odebrecht scandal doing to Peru what it has one to Brazil, this current government is here to stay for the next four years—no matter how many politicians move in and out. Hopefully, Fujimori can cooperate enough to allow Araoz and Kuzcynski to govern and shore up support.