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Peru’s Polarized Election Reflects Democratic Malaise

In Peru’s runoff election, a razor-thin victory by leftist Pedro Castillo will likely put an end to the country’s neoliberal consensus. However, political turmoil is set to continue.

Published on June 10, 2021

In a highly contested presidential election in Peru, socialist political outsider Pedro Castillo seems to have beat Keiko Fujimori, the daughter of former dictator Alberto Fujimori, by a margin of less than 100,000 votes of the 18 million total votes cast. This result represents a broad rejection of the country’s political establishment and a watershed moment for Peruvian politics. It lays bare deep-seated frustration after Peru has been led by four presidents (and eight finance ministers) over the past five years, seen massive political upheaval and protest, and more recently suffered the world’s highest per capita COVID-19 death rate (over 500 deaths per 100,000 people)—despite enduring long periods of lockdown and an economic crisis that saw its GDP plunge by 11.6 percent in 2020.

The Candidates

In the first round, voters were so unimpressed by the candidates that more than 3 million Peruvians voted blank or null, exceeding the number of votes of any other candidate. For moderates in particular, the runoff offered a choice between two unappealing options. Keiko Fujimori—who received 13 percent of the vote in a highly fragmented first round and who lost previous runoffs in 2011 and 2016 by small margins—has faced numerous accusations of campaign finance violations and money laundering and graft. Furthermore, she has been imprisoned three times and has proposed a demodura (a so-called hard democracy), a vague idea combining democracy with the supposedly positive aspects of autocracy—even though she promised to respect judicial independence. She also has refused to explicitly distance herself from her father, Alberto, who is serving a twenty-five-year jail sentence for corruption and committing death squad murders. Furthermore, Fujimori has said she would pardon him, a move that would shut down trials for the forced sterilization of thousands of women, mainly in the Andes and Amazon regions, that occurred under her father’s rule. Still, in the end, she received broad support from traditional political and economic elites in Lima, including longtime foes such as Nobel Peace Prize winner Mario Vargas Llosa.

The victorious Pedro Castillo, on the other hand, is a former schoolteacher and union leader who ran with a Marxist-Leninist party and chose the campaign slogan, “No more poor people in a rich country,” reflecting the promise of greater redistributive measures and a stronger role for the state in an economy that has traditionally been one of South America’s most liberal ones. Socially conservative and strongly opposed to gay marriage and the right to abortion, he obtained 19 percent of the vote in the first round. Castillo, who began his speeches on the campaign trail by saying “I come from deep Peru,” sought political office for the first time and had been largely unknown to urban Peruvians until the presidential elections, a sign of the political and cultural disconnect between Lima and the country’s rural regions. Castillo, who gave almost no interviews to mainstream media outlets during the campaign, will be only the second president born outside of Lima since 1956.

Castillo’s First Moves

Castillo has also promised to replace the constitution of 1993, which was written under Alberto Fujimori a year after the recently elected outsider successfully staged a coup and closed down the country’s Congress and Supreme Court. This constitution limits the state’s ability to engage in business activities. As such, markets showed concern about Castillo’s more radical ideas after it became clear that he would win—Peruvian stocks initially lost 8 percent of their value. Some of the ideas in his original campaign manifesto seem to contradict democratic principles, including sentences like “socialism does not advocate for freedom of the press, but for the press committed to the education and cohesion of its people.”

Yet the leftist leader will face formidable impediments in Peru’s highly fractured Congress, where his Peru Libre party has only 28 percent of the seats and may not be able to implement many of his proposals. Indeed, given Peruvian lawmakers’ combative relationship with past presidents—most notably their failed attempt to impeach Pedro Pablo Kuczynski in 2017 and their successful ouster of Martín Vizcarra three years later—it is far from assured that Castillo will be able to serve his full term. After all, like most of his predecessors, Castillo (who has no previous governing experience) will be a minority president, which requires constant negotiations to cajole congressmen to support the president’s proposals. Like in Brazil, this setup creates incentives for corrupt practices. Just like Keiko Fujimori’s Fuerza Popular party launched a campaign to oust Kuczynski in 2017, it is likely that it will attempt to do the same with Castillo. Fujimori’s accusations of voter fraud, without presenting any evidence, do not suggest her party is willing to cooperate with the new president.

The fact that Castillo won with the smallest of margins is likely to further limit his mandate for change and make it harder for him to convince Congress to go along with his more controversial policies. After his victory in the first round, Castillo moderated his rhetoric somewhat, and advisers said he did not defend outright expropriations. Like former president Ollanta Humala—who held office from 2011 to 2016, won as a leftist populist candidate but ended up governing as a moderate neoliberal, and did not threaten democracy—Castillo may tack toward the center preemptively, even though he continued to speak somewhat erratically during the campaign of nationalizing companies.

Yet comparisons between Humala and Castillo overlook that public frustration with democracy today seems to be far more deep-seated than it was ten years ago, as last year’s wave of civil unrest shows. While the election of the fifty-one-year-old Castillo may seem somewhat coincidental at first, his insurgent campaign grasped the population’s rage better than most others, consistently pointing to structural inequalities between urban and rural regions that elites in the capital had neglected and where state presence continues to be limited. The Vacuna-gate scandal, which involved many well-connected policymakers secretly receiving COVID-19 vaccines while the nationwide vaccination campaign remained painfully slow, seemed to symbolize the establishment’s moral bankruptcy, which was already severely battered by never-ending news about corruption scandals. Three ex-presidents are under investigation and another, Alan García, killed himself in 2019 as police were about to arrest him.

Bridging Political Divides

While it is entirely unclear whether Castillo can address Peru’s multiple challenges, his election represents a demand for change that is more fundamental than policy elites like to acknowledge. These demands range from the need to make decisionmaking processes more inclusive and transparent to renegotiating Peru’s social contract. Along with Chile, Peru boasted the region’s most stable economy, which grew at an annual average of 4.3 percent between 1990 and 2019, compared to the 2.6 average percent growth of the region. Yet particularly in the eyes of many rural voters, Peru’s neoliberal economic model has left too many behind—an opinion that surprised many outside observers, who had often referred to the country as a model because it had reduced its poverty rate to 21.7 percent (before it shot up to 27.5 percent during the pandemic). Aware of changing public opinion, even Keiko Fujimori, a defender of Peru’s liberal economic policies, had proposed adjustments during the campaign, such as raising the minimum wage and improving the country’s social safety net.

Promoting such a debate in a constructive manner has worked in neighboring Chile, where large-scale discontent and protests in 2019 were channeled into an inclusive debate about the future of the country. Chile’s institutional solution—symbolized by the creation of a constituent assembly—stands in contrast to Brazil’s wave of protests, which produced a massive anti-establishment sentiment that eventually led to the rise of President Jair Bolsonaro, a populist outsider with authoritarian ambitions who often suggests that a greater concentration of power in the presidency could solve the country’s ills. Given how unpopular Peru’s Congress is, Castillo may feel tempted to embrace a similar route, reminiscent of Alberto Fujimori, who closed down Congress in the name of national renewal in 1992—a move that preceded years of dictatorship and political persecution. Expecting Peru to follow into Chile’s recent footsteps thus seems to be excessively optimistic.

Peru’s plight represents, in many ways, the deep malaise of democracy across Latin America, worsened by the pandemic, which has led to economic collapse and brutally exposed the weaknesses of public services—aggravated by extreme polarization, a perception of impunity among political elites, and little faith in democratic institutions. As Peru’s democracy is set to face a serious challenge, civil society will have to play a key role in seeking to prevent the erosion of the country’s institutions. More broadly speaking, the fact that even Peru and Chile, Latin America’s economic star performers, are gripped by anti-establishment sentiment shows that a fundamental rethink is necessary about what constitutes successful policy. Now, political elites must focus not only on GDP figures but also on the quality of public services, especially in poorer regions; anti-corruption legislation; and indices of inequality and social mobility.

Carnegie does not take institutional positions on public policy issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of Carnegie, its staff, or its trustees.