Last week’s inauguration of Pedro Pablo Kuczynski as Peru’s new president put a business-friendly technocrat back in the Casa de Pizarro, Peru’s presidential palace, and the new administration is certain to promote foreign investment and trade as a mechanism to spur economic growth. In Peru, however, such growth does not necessarily lead to governability, and if Kuczynski is unable to quickly improve the country’s basic government services, he will likely face protests and social conflicts much like those that beset his predecessors.
A Nation Unsatisfied
One does not need to look far to find examples of previous Peruvian presidents for whom economic growth was not enough to win over the support of the population. Despite overseeing a period of unprecedented economic performance, former president Alejando Toledo had single-digit approval ratings during his tenure. In running for non-consecutive reelection this year, former president Alan García, who governed while commodities prices greatly boosted the economy, failed to win even 6% of the vote. And despite his own achievements, former president Ollanta Humala spent much of his tenure as Latin America’s least-popular president, with only 15% of the population approving of his job performance in the last weeks of his administration, although, as is typical in Peru, he received a bump in his ratings immediately before turning over the presidential sash to Kuczynski as voters registered their satisfaction that the outgoing president was leaving.
Peruvians’ discontent with their country’s politics runs much deeper than anger at any given president, however. Rather, the entire political system and all major government institutions are widely questioned, if not held in contempt, in Peru. In the latest Latinobarómetro survey, for example, only 24% of Peruvians said that they were satisfied with democracy, and only 8% – by far the lowest in Latin America – claimed to feel represented in Congress. This is despite Peru being seen within the business and investment community as one of the rising economic stars of Latin America, with its economic performance winning it seat at the Trans-Pacific Partnership negotiations.
Failing Government Services
The disconnect between growth rates and popular support of the government is largely explained by poor quality of Peru’s public services. Chief among these is the country’s dismal educational system, which is so underfunded that it is not uncommon for younger pupils to be sent home unless they bring their own toilet paper to school, since the state is unable to provide it. Unsurprisingly, the system is singularly bad at preparing students for university: an OECD study of students’ understanding of mathematics, reading, and science in 64 countries found that Peru was dead last in all three subjects. A World Bank report, meanwhile, revealed that of 40 selected countries and regions, Peru had the strongest association between the level of educational achievement of parents and that of their children, a sign that children of upper-class educated people have access to quality (i.e., private) education, but the public system utterly fails the poor.
Other services likewise foster resentment of the political class among ordinary Peruvians. Despite decades of promises, some poor areas of Lima still do not have piped water 24 hours a day, and those that do have access to water usually have to boil it before it can be safely consumed. Likewise, shantytown areas have little access to trash collection, police protection is undermined by a corrupt and unprofessional police force, frequent occurrences of buses plunging off of Andean highways undermine confidence in the road infrastructure, and the public health system is notoriously slow to treat patients.
Outlook
To a limited degree, Kuczynski’s instinct to govern as a technocrat might actually be advantageous as he works to address some of these issues. For example, as a partisan of the International Monetary Fund’s credo of shrinking the state and refocusing it on providing a few core government services, Kuczynski has already declared that ensuring homes have access to water and improving the health system are major priorities of his, and he has framed those priorities as non-political and common-sense issues. Achieving significant progress in these areas would buy him a level of political goodwill.
In other areas, however, Kuczynski’s technocratic nature will be a disadvantage, and he will be forced to either embrace the horse-trading nature of traditional politics or risk debilitating unpopularity.
Education is the clearest example of such an area. As a market-oriented economist, Kuczynski is unlikely to enjoy a cordial relationship with SUTEP, the teachers’ union, particularly given that SUTEP’s leadership is traditionally drawn from Patria Roja, a communist party. Any attempt to overhaul the educational system without the buy-in of the teachers, however, is likely to not only fail, but also to produce major protests and teachers’ strikes while doing so. There can be no reform without negotiating with SUTEP and agreeing to increase primary education funding in exchange for concessions from the union, a task better tackled by a skilled political negotiator than a technocratic administrator.
Kuczynski has almost no support in the opposition-controlled Congress, and his election with only 50.12% of the vote – the narrowest margin of victory in Peruvian history – limits the mandate he can claim. Nevertheless, for Kuczynski to govern the country without being undermined by social conflict, he must maintain a technocratic focus on government services while selectively entering the world of traditional politics, choosing his battles wisely in an effort to improve services without provoking opposition protest.
Michael Baney is a Senior Political Risk Analyst at Allan & Associates, a Hong Kong-based security and political risk consulting firm. He covers Latin America for A2 Global, the company’s information service. You can follow him on Twitter @BaneyMike.
