Last week, former World Bank executive Pedro Pablo Kuczynski, a center-right politician who narrowly edged out the left-leaning Keiko Fujimori (daughter of former Peruvian President Alberto Fujimori, a strong-armed populist now in prison on charges of corruption and running death squads during his presidency) by less than half a percentage point in a June 5 runoff election, assumed the role of president of South America’s fastest-growing economy.
And while Kuczynski may have his work cut out for him trying to undo the knotted legacy of Fujimorismo that has permeated the country for more than a quarter of a century (and which is strongly represented in Peru’s unfriendly Congress), he is perhaps the nation’s biggest hope to keep the economy on track to become an Organization for Economic Cooperation and Development (OECD) member by 2021.
Kuczynski’s credentials are impressive, although his leadership skills are yet to be seen, since this is his first real political posting.
But he is going to have to maneuver his way through some serious political crossfire if he is to be successful in his five-year term.
While keeping his campaign promise to not grant a pardon for Alberto Fujimori (which is one of the main reasons voters supported a candidate that they knew little about and whose name they could not figure out how to spell), he is going to have to court the populist Fujimoristas if he hopes to pass his bucket list of reform initiatives.
That means he is going to have to walk a delicate tightrope between left and right, all the time trying to push through a lofty agenda to ease bureaucratic red tape that is blocking many foreign investment projects, upgrade infrastructure (including airports, ports, roads, trains and gas pipelines), and standardize and implement strict compliance with environmental regulations.
Kuczynski also wants to promote small- and medium-sized enterprises to help further diversify the Peruvian economy and cut taxes in order to enlist up to 60 percent of workers into the formal economy by 2021.
Agriculture may be one of Kuczynski’s biggest challenges, since most of Peru’s 3.2 million poor live in rural areas.
Agriculture currently supplies two-thirds of the country’s food supply and represents one-third of jobs, and an old papa-government philosophy prevails in rural Peru.
That won’t sit well with Kuczynski’s businessmen-packed cabinet that wants to eliminate antiquated socialist practices.
In his inaugural address, Kuczynski said that, in addition to fighting drug trafficking and crime, his biggest goal will be to deliver clean potable water to the 40 percent of Peruvians who lack this basic service.
Kuczynski’s dream is to make Peru the Latin American role model for market-oriented liberalism and social stability.
But that could prove to be a very high order since Peru is a massive country with many social and economic schisms and it has a dubious history of ungovernability.
Also, the Peruvian economic engine is creeping toward a slowdown.
Kuczynski will have to jump start it by revving up copper production (which has been blocked in recent years due to violent local protests).
There is no denying that Kuczynski has his work cut out for him over the next half decade, but if he remains competent and determined, chances are he will accomplish most of his objectives.
Thérèse Margolis can be reached at [email protected].
