Six months into the administration, signs of an impending deterioration in the relationship between the Executive and Congress are starting to surface. Although it is unlikely that Dina Boluarte’s stability in office will be impacted, as there is a prevailing incentive for continuity in both branches of government, the end of the initial honeymoon period is approaching. A faction of the parties initially aligned with the government coalition seems to be choosing to distance themselves from a government that is becoming increasingly delegitimized.
During a recent interview, Keiko Fujimori, leader of the Fuerza Popular party, strongly criticized the government and suggested that the president should make changes in the ministries of Energy and Mines, Interior, Agrarian Development, and Health. It is anticipated that Fuerza Popular will continue to distance itself from the government and openly position itself as the opposition in the future. Similar sentiments have been expressed by Congressman José Cueto of Renovacion Popular. Reflecting this sentiment, Congress has approved motions for interpellation of the ministers of Energy and Mines, Justice, and Health (the Health Minister resigned on June 15th after the motion against her was approved). President Boluarte is expected to announce cabinet modifications during the State of the Nation address on July 28th.
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Senior analyst
Last month, we identified four pieces of good news for the business environment: (i) lower prices of certain imported goods, (ii) lower political risk, (iii) improved business confidence, and (iv) some stabilization in local financial variables.
After a challenging start of the year, characterized by social conflicts and heavy rains, the Peruvian economy has begun to show signs of recovery, albeit at a slow pace.
Nearly six months into the change of government, the probability of president Boluarte completing her presidential term increases despite underlying risks.
