The masochist

Peru's president

Aug 18th 2005 LIMA
From The Economist print edition

How not to reshuffle a cabinet

IF SHOOTING oneself in the foot were an Olympic sport, Alejandro Toledo would win the gold medal. As he began his fifth and final year as Peru's president, Mr Toledo had been enjoying a welcome wavelet of adulation. Thanks mainly to a strong economy, his approval rating in some opinion polls had risen to 20%—modest enough, but more than double the figure for much of the past 18 months. Pundits expected the president's popularity to carry on rising in the run-up to an election next April. All Mr Toledo had to do was nothing.

That proved too much for him. On August 11th, he named as foreign minister Fernando Olivera, a close political ally. The appointment of Mr Olivera, an outspoken and erratic muckraker, was greeted with derision. That prompted Carlos Ferrero, the prime minister, to quit, triggering the resignation of the whole cabinet.

Mr Olivera complained that Mr Ferrero, having approved his appointment, betrayed him. He said his party might no longer support the government. In theory, that would leave the president with just 34 votes in the 120-seat Congress. Peruvians blamed Mr Toledo for the debacle: his approval rating halved to 8% in one poll.

But this time the president may recover more swiftly than from his many previous self-inflicted wounds (which range from flip-flopping on privatisations to firing reformers and replacing them with nepotists). On August 16th he named Pedro Pablo Kuczynski, the finance minister, as the new premier. Mr Kuczynski, an experienced liberal reformer, can claim much credit for four years of economic growth, which has averaged 4.6% a year, while also improving the public finances. Mr Kucyznski in turn picked his deputy, Fernando Zavala, as his replacement, while Óscar Maúrtua, an experienced diplomat, became foreign minister.

Mr Kuczynski, whom Mr Toledo had earlier this year half-heartedly proposed to head the Inter-American Development Bank, has presidential ambitions. Polls give him less than 5% support, and Peruvians tend not to vote for members of the country's white financial elite. But next year's election looks wide open, with none of the hopefuls commanding more than 22%. If Mr Kuczynski is to run, by law he would have to resign by October 8th. He might be in his new job for only a few weeks—giving Mr Toledo a new chance to create a crisis out of an opportunity.

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