Martin Vizcarra took office as Peru's new president today, pledging unity to lift the resource-rich country out of a prolonged political crisis.
The new president, who comes from a mining state and is unlikely to knock Peru off its right-of-center economic path, said the country is facing a moment of upheaval and promised to make the fight against corruption his first priority. He vowed to make a fresh start with a completely new 19-member cabinet.
An engineer and former governor of the southern state of Moquegua, Vizcarra was elected vice president in 2016 on the ticket headed by the former investment banker whom he replaced, Pedro Pablo Kuczynski.
Vizcarra, who had also been serving as ambassador to Canada, promised to work for political stability, economic growth and quality of life. In his brief inaugural address today, he promised to unveil concrete policies in the coming week, after he organizes his new cabinet.
A few pressing issues could make or break his presidency. The first test is Kuczynski himself and second vice president Mercedes Araoz. Judicial authorities are considering a request to bar the former president, who resigned on 21 March, from leaving the country while investigations continue. As for Araoz, congress has already taken the first step by expelling her from her legislative seat, because of potential involvement in a vote-buying scandal on behalf of Kuczynzki.
Luis Nunes, a political analyst, said any indication of special treatment would seriously undermine Vizcarra.
A broader regional test will be the high-profile Summit of the Americas, scheduled for 13-14 April in Lima. The White House has reconfirmed president Donald Trump's participation. The summit will be a chance for Vizcarra to meet his counterparts and show he is ready for the job. Rogue Venezuelan president Nicolas Maduro has pledged to attend the summit, setting up a potential face-off with other Latin American presidents who fiercely oppose his autocratic policies.
Several large hydrocarbons and mining projects are pending final investment decisions, including the $7.3bn, 1,000km southern gas pipeline would end in Ilo, a port city in Vizcarra's home region. The project is one of many across the region that was effectively orphaned by Odebrecht. The pipeline is seen as key to deepening Peru's gas business beyond LNG exports and limited domestic consumption.
Strategic imminent appointments are the heads of state-owned PetroPeru and hydrocarbons promotion agency PeruPetro. Both resigned in tandem with Kuczynski.
Decisions by several mining companies for projects worth a total of more than $10bn are expected in the next few months, including the $5.5bn Quellaveco copper project planned by Anglo American, also in the president's Moquegua region. Anglo American has promised a decision by June. Other mining projects in the wings are copper, iron and silver mines, all located in the south.
Weary Peruvians are mainly focused on household economic issues. Vizcarra takes office with the highest unemployment rate, 8pc, in nearly six years, and a rising fiscal deficit, 3.3pc in February. Kuczynski may have added to the pressure by ordering an increase in the monthly minimum wage, to 930 soles ($291), shortly before stepping down.
Outgoing finance minister Claudia Cooper said yesterday that despite the problems, the economy is on a solid footing, with credit rating agencies reaffirming the country's investment-grade ranking. She said Peru should meet a 4pc growth target for the year.
Kuczynski became ensnared in a perjury scandal late last year, when evidence surfaced that a company he founded had worked with corruption-tainted Brazilian construction company Odebrecht, a connection he repeatedly denied. Information surfaced contradicting his position and the congress swiftly employed the perjury charge to organize an impeachment hearing on grounds he was morally unfit to govern. The December effort fell eight votes short of the 87 needed to impeach him.
Additional incriminating evidence piled up, leading to a second impeachment trial that had been scheduled for 22 March. But secretly taped meetings of some of the president's allies trying to buy votes were the final blow.
