Peru’s new president confirms Moderate as Minister of Finance

Peru Update

Peru’s new president, Pedro Castillo, appointed a moderate leftist as finance minister, a move that may calm the market after turbulent days.

At a late-night ceremony in Lima on Friday, Castillo confirmed the position of former World Bank economist Pedro Frank.

It is widely expected that Frank will get the job-until Thursday, Castillo unexpectedly Known as the hardline leftGuido Bellido, as his prime minister. This puts the ministerial appointment into question: Moderates, including Frank, seem to be hesitant to work with Bellido.

When Castillo confirmed most of his cabinet on Thursday night, Frank was not present. He left the venue shortly before the swearing-in ceremony, raising questions about whether he refused to accept the job or did not get the job. The post of Minister of Finance is vacant.

On Friday, the market reacted poorly. The Peruvian Stock Exchange fell as much as 6%, while the currency Sol recorded its biggest one-day drop in 7 years and fell below the psychological threshold of 4 Sol to the US dollar for the first time in history.

After the market closed, Bellido issued a peace proposal to Frank, saying that the 60-year-old economist “fully supported” the implementation of the economic plan Castillo ran in the second round of elections. He won on June 6.

The plan is not as radical as the earlier version. Although it still calls for a complete reform of the mining industry in Peru, the world’s second-largest copper producer, the early version frightened many investors.

Frank’s appointment was three days after the roller coaster in Peru.

Wednesday-the 200th anniversary of the country’s independence from Spanish rule- Castillo Take the oath of office in a symbolic ceremony. As a rural elementary school teacher who has never held a public office, he praised his coming to power as a victory for the oppressed in Peru.

The next day, he appointed Bellido, which surprised everyone. Bellido was a Marxist congressman. Many believed that he was the defender of the glorious path. Maoist guerrillas launched against the Peruvian country in the 1970s and 1980s. A bloody war.

That date The Castillo government is in crisis Almost from the beginning, it alienated potential moderate and centrist allies.

Frank’s appointment may repair this damage to some extent, but Castillo may still have difficulty getting his agenda through parliament.

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