Observers Discuss Economic Perspectives Ahead of Peru’s Presidential Election

June 07, 2021

Just four days ahead of Peru’s presidential election, the Santiago Center, along with the Business Alumni Club Peru, the Jerome A. Chazen Institute for Global Business, and the Columbia Latin America Business Association, held a panel to discuss the country’s economic outlook and share thoughts on international perspectives towards the polarized June 6 election between Luis Castillo (of the left leaning Perú Libre party) and Keiko Fujimori (from the right-wing Fuerza Popular).

Marlene Savarain (CBS’04), co-head of the Columbia Business School Alumni Club Peru and chair of the event, started by raising two key questions to panelists Jorge Mariscal, Adjunct Professor at the Columbia School of International and Public Affairs (SIPA); Liliana Rojas-Suárez, Chair of the Latin American Committee on Macroeconomic and Financial Issues (CLAAF); and Luis Oganes, Global Head of Emerging Markets Research for J.P. Morgan: How solid is the Peruvian economy? And how is the country perceived by the rest of the world?

Rojas-Suárez, who is also an adjunct professor at SIPA, stated that since the beginning of the pandemic, Peru has used its fiscal space while maintaining access to international markets, indicating economic solidity, “something that many other emerging countries have been unable to achieve.” She emphasized that with respect to the election “the greatest danger from the economic point of view is losing our macro stability.”

Oganes, on the other hand, referred to Peru’s political instability and to how populist economic measures have undermined the country’s image in international markets, stressing that “Peru still has the benefit of the doubt that the economic decline may be temporary due to the pandemic, but it is at risk because one of the candidates [Castillo] proposes an abrupt change unseen in the last three decades, which generates uncertainty.” Finally, Mariscal stated that the election “can split Peru's electoral history in two and that “The important thing is to send a sign of economic prudence.”

Both economists agreed that regardless of the election result, maintaining the independence of Peru’s Central Bank will be key.