President Alan García of Peru has marked the midway point of his five-year term in office by revamping his cabinet, partly in response to widespread social protests and bribery revelations. The most prominent move has been to appoint a prominent left-winger as prime minister. This attempt to widen the government's political base will need to be combined with a more coherent political and social strategy if the state is to address the deeper problems that face Peru - in conditions where the economic boom of the mid-2000s begins to fade.

Among openDemocracy's articles on conflicts and politics in Peru:

Ricardo Uceda, "Fantasy Island" (20 September 2005)

Ricardo Uceda, "Peru's election: a second leap into the void" (9 January 2006)

Lisa Laplante, "The cloud of fear: Peru's anti-terror lesson" (7 March 2006)

Justin Vogler, "Ollanta Humala: a Peruvian gamble" (7 April 2006)

Gaby Oré Aguilar, "Peru vs Fujimori: justice in the time of reason" (10 July 2008)García's selection of Yehude Simón as prime minister on 14 October 2008 was the most visible sign of his intention to breathe new life into a faltering administration. Insofar as the success of the reshuffle depends on this one figure it carries risks, for Simón is a controversial figure. He spent six years in jail during the Peru's decade of rule by the authoritarian Alberto Fujimori (1990-2000), ostensibly on account of his role as publicist for the proscribed (Castroite) Movimiento Revolucionario Tupac Amaru (MRTA) - a charge he has consistently denied.  

Since 2002, Simón has been the regional president of Lambayeque in northern Peru, where he has gained a reputation both as a catalyst for business investment and at the same time a guarantor of an honest and socially sensitive administration. This is a combination that Alan García would earnestly like to emulate during the remains of his period in office. It is also a mix that, historically, has proved remarkably elusive in Peru; and it will be surprising if García can break the trend.  

No left turn

Yehude Simón's appointment has been seen as a leftward turn, though the cabinet reshuffle that took place a few days later suggests that it does not constitute any sharp change of direction in the García administration. Many key ministers were reappointed, most notably Luis Valdivieso, the orthodox-minded finance minister who previously worked for many years behind the scenes at the International Monetary Fund (IMF). Antero Flores Aráoz, formerly a leader of the rightwing Partido Popular Cristiano (PPC), was also ratified as defence minister, an important post given the political sensitivities surrounding human-rights violations in the 1980s and 1990s by members of the armed forces (see Gaby Oré Aguilar, "Peru vs Fujimori: justice in the time of reason", 10 July 2008).

Simón's supporters were awarded only two "social" ministries (health and women's affairs). The main losers from the reshuffle were people from García's own Alianza Popular Revolucionaria Americana (APRA) party, which now occupies only three ministries. Two key APRA figures are gone: the previously serving prime minister Jorge Del Castillo, cited in a scandal concerning the irregular awarding of contracts to oil companies in the Amazon jungle; and interior minister Luis Alva Castro, prime minister during García's first administration (1985-90), now replaced by a retired police general.  

A losing run 

Alan García hopes that the reshuffle will help him consolidate his position in the centre-ground of politics, thus enabling him to win back lost political support. The current opinion-polls make grim reading for the president: at least one suggests that as few as 15% of voters consider him to be doing a good job, down from around 60% in 2006. García knows from bitter experience from his first term of office how ebbing popularity can erode legitimacy, and he is anxious to avoid repeating past mistakes.  

The immediate cause of the decline in support for the government is the rise in inflation, especially of imported food products. The inflation-rate is still far lower than during the hyperinflation that raged in the late 1980s, but it is still eroding the living standards of the poor (most of whose purchases are spent on food). The recent depreciation of Peru's currency (the nuevo sol) reflects international market uncertainties and the decline of commodity export prices may make it harder to keep the lid on inflation. How the government deals with this issue will be a key factor in its efforts to recover lost support.

John Crabtree is a research associate at Oxford University's Centre for Latin American Studies. He is the author of Peru under Garcia: Opportunity Lost (Macmillan, 1992) and Patterns of Protest: Politics and Social Movements in Bolivia (Latin America Bureau, 2005). He is the editor of Making Institutions Work in Peru: Democracy, Development and Inequality since 1980 (Institute for the Study of the Americas, London University / Brookings Institution, 2006) and co-editor of Unresolved Tensions: Bolivia Past and Present (Pittsburgh University Press, (2008)
Among John Crabtree's articles in openDemocracy:

"Bolivia: a tale of two (or rather three) cities" (18 September 2007)

"Alberto Fujimori's return: a political timebomb" (28 September 2007)

"Bolivia's controversial constitution" (10 December 2007)

"Santa Cruz's referendum, Bolivia's choice" (30 April 2008)

"Bolivia's democratic tides" (1 July 2008)

"Alan García and Peru: a tale of two eras" (29 July 2008)

"Bolivia's political ferment: revolution and recall" (13 August 2008) The other half

The disillusion with García and his policies, particularly among the poor who make up a majority of the voting population, stems from his failure to ensure that the benefits of growth are equitably distributed among all sectors of the population. Most people believe that the wealthiest sectors of society (particularly in the capital, Lima) have been the main beneficiaries of growth, while the poor (notably in the interior of the country) have received little or nothing. Yet benefits there are: Peru in the 2000s has been buoyed by an international boom in minerals prices, and has been among Latin America's fastest growing economies. The growth of GDP in 2008 is estimated to be 8%-9% - though the 2009 rate will be much lower.

Both the 2001 and 2006 presidential elections revealed a clear geographical cleavage in patterns of political allegiance.  Alan García's main support was located in urban areas, particularly along the country's relatively more prosperous coastal strip. His populist adversary, Ollanta Humala - who scored a higher percentage in the first round of voting - received most of his support in the interior, particularly in the Andean highlands and the Amazon jungle.  García won that race in statistical terms, but to consolidate his success politically would require delivering tangible benefits to those who did not vote for him as well as those who did.  This he has so far been unable to do. 

The institutional deficit

Successive governments in Peru have faced a similar difficulty: how to create channels for better distribution of resources, particularly in times of export boom and fiscal surplus. The presence of state institutions is at best precarious in those large parts of the country where poverty and social deprivation are most acute. Even where they do exist, they have a reputation for working in a corrupt and clientilist way, whereby local economic and political elites procure whatever benefits are available. The APRA party, in particular, has a reputation for working in this way.  

This lack of efficient institutions at the local level has in recent years proved to be one of the main obstacles to attempts to devolve the powers of Peru's historically centralised administration. Alan García - like his immediate predecessor Alejandro Toledo (2001-06) - has failed to honour promises to decentralise capacities to local government. The finance ministry, in particular, has obstructed any relinquishing of its control over public investment at the local level; its argument - quite plausible - is that there are no proper mechanisms for ensuring that tax revenues are distributed in a transparent or accountable manner.  

These limitations of the state at the local level is related to the weakness of representative institutions in Peru, particularly political parties. Peru's parties, which too traditionally have operated along highly clientilist lines, underwent a severe crisis in the 1990s - when the authoritarian Alberto Fujimori government made them the scapegoats for the economic and political hiatus of the late 1980s, and successfully expelled them to the margins of the political system.  They have since recovered some of their standing, but most parties today remain or have become simply the electoral vehicles for prominent political personalities.  They lack any real grounding in society. and fail to act as democratic conduits for popular and democratic pressure from below. 

A culture of protest

A number of social pressures have been building up in Peru both before and since the 2006 election, that are manifested in a revived culture of protest. This takes a variety of forms, of which three are worth mentioning.

First, the trade unions - which were weakened by the economic collapse of the 1980s and the economic liberalisation in the 1990s - have more recently again become more assertive over wages and working conditions. Mining unions have taken the lead, their leverage enhanced by the rise in minerals prices and a boom in production; but white-collar workers too (notably health workers and teachers) have become more militant. 

Second, across Peru's highlands, peasant communities have clashed with mining companies in defence of their land, water sources and traditional way of life.  Those who produce coca (the leaf that is the raw material for cocaine) are constantly at loggerheads with the government over United States-backed plans to eradicate their crops.  

Third, regional movements have also been active in campaigning for greater autonomy, particularly in the form of fiscal decentralisation. They want a larger share of the taxation which mining companies and other extractive industries pay the state (though they also sometimes clash between themselves over boundaries and the division of the spoils from natural resources). In the Amazonian region, regional authorities have sought to rally opinion in defence of the fiscal privileges they have traditionally enjoyed.  There too, indigenous groups have been provoked into confrontation by government policies, such as the attempt to encourage businesses investment in their traditional habitats.

These various social movements are fragmented, yet they increasingly act in coordination so as to maximise the pressure they can bring to bear. Protest in Peru comes in waves; García's reshuffle of his cabinet was in part forced by the way a number of different campaigns came together at the beginning of October 2008. 

The ombudsman's office in Peru has consistently noted that the lack of channels for political communication is such that social mobilisation can quickly turn violent.

The violent margin

Indeed, the history of political violence in Peru is a shadow behind the type of social polarisation now emerging. The memories are still fresh of the war in the 1980s-90s between the Maoist guerrillas of the Sendero Luminoso (Shining Path) movement and the Peruvian state - a conflict in which an estimated 57,000 people were killed (mainly innocent highland peasants caught in the crossfire). Sendero was defeated militarily in the early 1990s, and its leader Abimael Guzmán remains in prison; but the social conditions which gave rise to it live on largely unaltered in the poorest and least developed parts of the country.

The remnants of Sendero live on, using the proceeds of drug-trafficking to perpetrate armed attacks in those remote coca-growing valleys where the army has failed to root them out. The biggest such attack of recent years - a roadside-bomb followed by machine-gun strafing of army trucks in Huancavelica (east of Lima) on 9 October, killed nineteen soldiers. The incident was followed by an ambush in Vizcatan, southeast Peru, on 14 October which killed two more soldiers.

In this overall context, Alan García and his government face formidable difficulties in winning over the support of the disenchanted who voted for Ollanta Humala in 2006. They may again seek to express their sense of anger and frustration by giving their vote to Humala (or some other emergent "anti-system" candidate) in the presidential election in 2011.

Yehude Simón's job will be to improve on the social policies needed to tackle poverty, and so to increase the numbers of those who feel they have a stake in the system. Until now, the government in Lima has failed to engage with those who challenge it. Its response to social protest has been erratic and ineffectual, seeking to extinguish the flames but without tackling the causes of combustion. If this challenge is not met - in circumstances where international financial troubles will increase the pressures in Peru - the next protest wave could be even more powerful than the last.