Political upheaval in Peru is battering industries that have long powered one of Latin America’s fastest-growing economies. While prior political upheaval failed to dent the mining and tourism-driven economy, current anti-government protests are undermining the country’s reputation as a stable investment destination, the WSJ’s Ryan Dube reports.
The protests against President Dina Boluarte’s regime stem from deep seated social divides, corruption and longstanding political stagnation. The protests and riots hitting transportation and mining infrastructure have forced firms to halt operations in the world’s second biggest copper exporter. The tourism industry is also suffering, leaving thousands of people without work while food and fuel prices surge.
Costs from damage to infrastructure and lost production could amount to about $1.3 billion, the government says. The Lima Chamber of Commerce estimates that 1.1 million jobs could be lost and the former finance minister Alonso Segura projected a recession if the protests continue.
Since she made the commitment at the World Economic Forum in Davos last week, Veléz has been undercut in separate statements by the ministers for public credit and finance who suggested the decision could be reversed. Veléz later confirmed that canceling existing contracts was not being discussed but the country’s President Gustavo Petro also reaffirmed his government’s commitment to move away from fossil fuels and focus on renewable energy and boosting tourism.