Peru’s interim president Manuel Merino announces resignation following protests

Peru’s interim President Manuel Merino reviews an honour guard after he was sworn in following the removal of President Martin Vizcarra by lawmakers, in Lima, Peru.

Peruvian lawmakers and the country’s top court were set to debate on Monday who should take over as president after Congress failed overnight to name a candidate to become the third leader in the space of a week marred by deadly protests.

The Andean country’s interim leader, Manuel Merino, resigned on Sunday, after the ouster last week of his predecessor, centrist Martin Vizcarra, had sparked off protests and dragged the country into a constitutional crisis.

The political upheaval adds to the uncertainty facing Peru, the world’s no. 2 copper producer, already hard hit by COVID-19 and heading for its worst economic contraction in a century.

Peru’s fragmented and unpopular Congress will vote at 2 p.m. (1900 GMT) after an unsuccessful midnight vote to select the only name then put forward, Rocío Silva-Santisteban, a leftist human rights defender.

“There is a political immaturity from some and a lack of self-awareness from others in the face of what has happened in the country in the last week,” legislator Alberto de Belaunde, from the centrist Morado Party, told reporters.

His party is now nominating lawmaker Francisco Sagasti, a 76-year-old industrial engineer and former World Bank official.

“The main thing for Peru is to regain stability and for this nightmare to end,” de Belaunde added.

This slideshow requires JavaScript.

The recent crisis started when Vizcarra, a popular independent who has long clashed with Congress over his anti-corruption stance, was impeached and removed from office by lawmakers last week over allegations of graft, which he denies.

It was the second impeachment Vizcarra had faced in two months, after surviving the first one in September.

Merino, who as president of the Congress led the impeachments, succeeded Vizcarra. But he too resigned, after two people died in protests against his fledgling government and lawmakers threatened to impeach him unless he stood down.

Peru’s top court will also begin debating on Monday whether the impeachment and ouster of Vizcarra were constitutional, potentially opening the door for a dramatic return.

Citi said in a note that Vizcarra’s return was possible, though it would be unusual for the Constitutional Tribunal (TC) to overrule Congress. Both that outcome and the choice of Sagasti would likely help the situation.

Peru’s sovereign bonds fell on Monday amid fears of a political vacuum and the currency hit a record low.

“We believe that in the event the TC rules in a way that would allow for Vizcarra’s return, markets would take that well. If Sagasti is elected, that might be enough to settle the market’s nerves as well,” Citi said in a note.

“(However) tensions are likely to remain high for now, and the situation places downside risks on our macro outlook.”

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s