Industry Views: Political and Social Analysis

“Politicians in Peru are similar to politicians all over the world. They promise a number of things, but do not realize that there are checks and balances in place. In the case of Peru, this means the conformation of Congress. In the current Congress, where 10 political parties are represented, neither Mr. Castillo nor Mrs. Fujimori has control. The Peruvian system requires dialogue to reach consensus. A candidate can say what he/she wants to do, but turning this into legislation is another matter. There are some independent institutions in Peru that really work, and one of them is the Peruvian Central Bank (BCRP), which acts as the economic advisor of the Peruvian economy. Whoever wins the election needs to understand the economic challenges we are faced with and act accordingly.”

Roque Benavides, Chairman, Buenaventura

“Covid-19 has been the fuel on the fire of a long-standing and deep-rooted social and political problem in Latin America. Latam is home to 8% of the global population, but has accounted for 18% of Covid cases and 20% of Covid deaths. Why has the region performed so poorly in the face of the pandemic? Commentators have been quick to point out populist presidents in Brazil and Mexico who were skeptical of imposing lockdowns, however that was not the case in Peru which also suffered high death rates. There is something more endemic and pernicious at play, and the root cause is inequality.”

Michael Cullen, Managing Director – Latin America, FTI Consulting

“The current situation we are living in Peru might seem similar to the period before Humala was elected in 2011. Despite his radical discourse before the election, once he was elected, he understood that re-founding the country was not feasible and that he had to play by the rules of democracy. There are two fundamental differences with the context today: First, Humala signed a roadmap towards the second round of the election, which represented a moderation of his discourse. Second, he never threatened to close the congress, nationalize industries or disregard international agreements.”

Oscar Díaz, CEO, Viceversa Consulting

“Most of the areas where the big mining companies operate remain extremely poor. Therefore, many communities surrounding mining operations are not fond of our market economy as it has not benefitted them. The problem is not the market economy, but rather that the regional and local governments have done a poor job of bringing prosperity to their communities. If we had more efficient government we would have been able to build better infrastructure, health and educational services over the last 20 years. Regardless of who wins the election, the system has to be reformed.”

Orlando Marchesi, Country Senior Partner, PwC Peru