Former World Bank economist, Pedro Pablo Kuczynski has won Peru’s presidential election, beating his rival, Keiko Fujimori, by about 39,000 votes.
Outgoing president Ollanta Humala, who is constitutionally barred from seeking immediate re-election, will hand over the presidency to Kuczynski late next month.
Kuczynski’s election is likely to boost investor sentiment about the Peruvian economy slowed down by weak demand for mineral resources. The improvement of public security and the availability of running water for all Peruvians are some the major promises he made during the campaign trail.
Despite representing a small political outfit, Kuczynski found support from diverse political groups, including leftist political parties and labor unions, which were determined to see Keiko Fujimori lose the contest. Fujimori is the daughter of former president Alberto Fujimori, who is currently in prison after being charged with corruption and human rights violations.
The Andean country has been one of Latin America’s fastest-growing economies, but a lack of deeper reforms and decreasing demand for mineral resources in the international market appears to have been holding back its growth in recent years.
Analysts say Kuczynski will cut taxes and free entrepreneurs from too many regulatory laws in an attempt to encourage businesses to invest and create jobs. Peru is indeed seeing its poverty rate falling, but governments have not been able to keep up with rising middle-class expectations.
During the election campaigns, Kuczynski promised to return the country to 5 percent GDP growth by 2018. Peru’s growth slowed to 2.7 percent in 2015, largely due to decreasing demand for mineral resources.
He has proposed to formalize Peru’s workforce through expanded access to credit for small- and medium-sized enterprises (SMEs), while also reducing bureaucracy. His plans include raising minimum wage and adding nearly three million jobs to the formal economy.
Peru’s economy is forecast to grow 4 per cent in 2016, recovering thanks to an output boost at large mines.