Political Risk Latin America Blog @PolRiskLatam

Peru Votes: Humala and Fujimori Advance to Second Round

Posted in News and Articles, Political Risk by politicalrisklatam on April 12, 2011

by Roque Planas for the Council of the Americas – Americas Society, April 11th, 2011.

The first round of Peru’s presidential election proved what a difference a few weeks can make in a campaign cycle. Nationalist Ollanta Humala won, with 29.88 percent of the vote as of the morning after the election and with 80 percent of ballots counted. He will face conservative Keiko Fujimori, who garnered 23.03 percent of the vote, in the June 5 runoff. Fujimori, in turn, edged out Pedro Pablo Kuczynski, a centrist and former finance minister, who won 20.55 percent. Former President Alejandro Toledo—the frontrunner less than a month ago—earned just over 15 percent of ballots to take the fourth spot, raising questions about how the ground shifted in the election.

Alejandro Toledo’s opening remarks at the presidential debate on April 3 marked the changing tenor of the campaign cycle. “You have to decide not between five candidates,” Toledo said. “But rather between the future of growth and democracy that we represent, and leaping into the abyss.” Former President Toledo, a centrist and an economist by profession, went on to criticize the possibility of scaring away foreign investment and jeopardizing Peru’s enviable economic growth by increasing the role of the state in the economy. Toledo did not name names, but given that four of the five candidates for the April 10 election favored maintaining the country’s free-market model, he clearly aimed his comments at left-wing candidate Ollanta Humala. Last week, polls indicated a major jump for Humala, who had trailed behind Toledo and conservative candidate Keiko Fujimori for most of the campaign. With Humala’s rise, the role of the state in the economy came to dominate the presidential election more than any other issue.

Peru’s business community reacted to the news of Humala’s rise—and win—with nervousness, throwing the country’s currency and financial markets into a tizzy, according to Reuters. Humala has played to the center this campaign, using strategists from Brazil’s Workers Party to cultivate an image comparable to center-left ex-President Luiz Inácio Lula da Silva. But Peru’s business community remembers Humala’s unsuccessful 2006 bid, when he associated himself more closely withVenezuelan firebrand Hugo Chávez. Humala has indicated that he would nationalize the gas industry in the southern part of the country. A greater role for the state in Peru’s economy could bring uncertainty to some $40 million in mining and oil projects planned by the current government. (continue reading… )

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