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PERU: Cliff edge avoided, but governability and moderation may still be elusive

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President Pedro Castillo made seven changes to his cabinet yesterday, 6 October. The reshuffle promotes more moderate leftists largely at the expense of ministers who answer to the Peru Libre (PL) party boss Vladimir Cerron. The highly controversial Prime Minister (PCM) Guido Bellido is replaced by the more moderate Mirtha Vasquez, who was congressional president in the period following the November 2020 crisis until July of this year. Cabinet moderates with relevant expertise such as Finance Minister Pedro Francke and Health Minister Hernando Cevallos stay on.

A rupture within the PL is now possible; the Cerronista faction within the PL described the reshuffle as a “betrayal” and Cerron himself has reacted badly to the changes. A definitive rupture would complicate Castillo’s position in Congress because his “teacher faction” of the PL plus progressive leftists in the Vasquez/Francke mold have only minimal congressional representation. However, Castillo would have to moderate his policies to win the support of opposition parties; a first test will come with the congressional confidence vote in the new cabinet that must take place within 30 days. A second issue to watch will be how the government approaches contract negotiations with the Camisea natural gas consortium (which have been postponed amid yesterday’s upheaval) without Bellido’s aggressive showboating.

On the face of it, Castillo has hit back at critics who have accused him of constant vacillation. However, more decisive leadership from the president may not be forthcoming. Castillo was pushed to act by Bellido’s increasingly vocal insubordination and constant upping of tensions. The imminent flashpoint was the probable motion of censure vote against Labor Minister Iber Maravi, who has now been sacked, thereby removing the immediate problem. Bellido was intent on escalating the issue into a wider confidence vote against the whole cabinet, which would have put the Executive and Congress on a path towards a bigger crisis, potentially culminating in a congressional dissolution or presidential impeachment.

Castillo may also have been emboldened to act by the tightening legal noose around Cerron; a judge investigating corruption during Cerron’s stint as Junin regional governor (the so-called ” Dinamicos del Centro ” case) yesterday ordered that the PL secretary-general, Arturo Cardenas, be put in pre-trial detention. Prosecutors see Cerron as the head of what constituted a criminal organization. However, the appointment as the new Interior Minister of Luis Barranzuela, a lawyer to the PL, could be an offering from Castillo to Cerron that suggests not all bridges between the two have been burned.

Castillo’s inexperience, the PL’s internal divisions and weakness in Congress, together with Cerron’s radical tendencies all militate against a swift and enduring switch to policy moderation and coherence. Congressional tensions are likely to subside for now, but the fundamental dynamic is likely to be one of confrontation. The confidence vote threat and its end points of congressional dissolution or impeachment acts as a kind of deterrent to total crisis. However, Congress is looking for an edge by seeking to limit how and when the executive can deploy the confidence vote, which Castillo is naturally seeking to defend. The issue will probably end up in the Constitutional Court – control over which represents another looming political battle in the messy skirmishing that characterizes Peruvian politics under Castillo.

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PERU: Cliff edge avoided, but governability and moderation may still be elusive

President Pedro Castillo made seven changes to his cabinet yesterday, 6 October. The reshuffle promotes more moderate leftists largely at the expense of ministers