Peru’s President to Face Impeachment Proceedings in Congress

(Bloomberg) -- Peru’s congress opened impeachment proceedings against President Martin Vizcarra, throwing the country in political disarray just as it tries to recover from the devastating impact of the pandemic.

On late Friday, lawmakers voted 65-36 with 24 abstentions to start the process that may remove Vizcarra from office following allegations he sought to obstruct a graft probe into his administration. A final decision will be made not earlier than next week, after the president has had a chance to defend himself in the opposition-controlled congress. Two-thirds of the 130 lawmakers, or 87 votes, are needed to impeach him.

The political turmoil risks weighing on an economy badly battered by the pandemic. With the world’s highest deaths per capita from the coronavirus, the South American nation saw gross domestic product tumble 30% in the second quarter, the worst slump of any major economy. It also marks the latest chapter in the history of one of Latin America’s most volatile political systems.

The fact that more than 20 votes are still needed to reach the impeachment threshold means congress is still split on this, said Jose Carlos Requena, a Lima-based political analyst.

“It seems like the appetite for impeachment has reduced, but let’s see if it stays that way,” he said in a telephone interview. “Nothing guarantees that new things won’t emerge. Anything can happen before the vote. I wouldn’t be at ease if I were in Vizcarra’s shoes.”

Next Steps

Vizcarra, who has no party to defend him in congress, is the second Peruvian leader facing impeachment proceedings in less than three years. His predecessor, Pedro Pablo Kuczynski, resigned after an opposition lawmaker released videos that showed his allies apparently negotiating votes to stave off his ouster.

The Peruvian sol was the worst-performing emerging markets currency Friday, losing 0.8% versus the dollar, the most in three months.

Since replacing Kuczynski in 2018, Vizcarra, 57, has tried to overhaul the nation’s judicial and political systems, frequently clashing with lawmakers in the process and even dissolving the previous legislature last year.

If Vizcarra is impeached, the head of congress, Manuel Merino, will take over until elections take place. Peru is due to hold a general election in April, and Vizcarra has repeatedly said he won’t seek a new term.

Speaking before the vote, Vizcarra’s cabinet chief Walter Martos said the government will use all legal measures available to defend the president. Congress is trying to upset the democratic order using an “arbitrary interpretation of the constitution,” he said. “What congress is doing is practically a coup.”

Peru’s constitution allows congress to impeach the president on the grounds of “moral incapacity.”

‘Layer of Uncertainty’

Earlier this week, lawmakers also presented a motion to remove Finance Minister Maria Antonieta Alva from her post, alleging she didn’t do enough to prevent the economic slump during the pandemic.

“This political crisis adds another layer of uncertainty to an economy already stressed by the severe pandemic impact on all grounds,” JPMorgan Chase & Co.’s analysts Diego Pereira and Lucila Barbeito wrote in a report. “This new congress has proved even more antagonistic to the government than the previous one, and thus the likelihood of a deeper institutional crisis could not be ruled out.”

$50,000 Contracts

Prosecutors and lawmakers this year began probing alleged irregularities in the government’s hiring of a little-known singer to give motivational talks at the Culture Ministry. The singer, Richard Cisneros, is alleged to have used contacts in the presidential palace to obtain contracts totaling about $50,000, despite lacking experience.

On Thursday morning, lawmakers heard tapes of Vizcarra appearing to speak to officials about Cisneros’ visits to the presidential palace. Less than 12 hours later they presented a motion to unseat him.

In one excerpt, Vizcarra appears to say Cisneros made several visits to the presidential palace and instructs his staff to say that only a few took place.

Vizcarra said in a televised address Thursday that the release of tapes was part of a plot by political opponents to remove him from power, using a combative rhetoric that only inflamed tensions with lawmakers.

“If you want to impeach me, here I am. With my head held high and with my conscience clear,” he said. “Nothing of what was presented today, illegally, constitutes grounds for impeachment. I’m not going to resign. I don’t run away.”

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