BUSINESSWEEK ONLINE : APRIL 24, 2000 ISSUE
INTERNATIONAL BUSINESS Commentary: Peru: Fujimori's Ploy May Blow Up in His Face His electoral scam could set off forces even an autocrat can't control The verdict on Peru's general elections last Sunday was in well before the final vote tally was announced: The process flunked international standards of fairness on almost every count. Little effort went into hiding the poll's glaring defects, from doctored ballots to the mainstream media blackout of the election-night protests led by President Alberto Fujimori's main challenger, Alejandro Toledo. Then again, since he was first elected in 1990, Fujimori has never allowed any laws, not even his own, to stand in his way. His third--and arguably unconstitutional--presidential bid is a case in point. As the vote counting continues, Fujimori is within a whisker of a first-round victory against his surprisingly strong rival, Toledo. Yet Peruvians and the rest of the world may never know whether the result of the 2000 election was adulterated or not. According to international and local observers, what ensued after polling stations closed was, if not fraud, a managerial mess. Dozens of ballot boxes lay uncollected for hours because of transport hitches, while observers were unable to verify the computer count of the vote the next morning because most computing centers were closed. So when the news came out that Fujimori was close to the 50% plus one vote needed for a first-round victory, Eduardo Stein, chief of the monitoring mission dispatched to Peru by the Organization of American States, was amazed. ''These results came out of nowhere,'' he said. ''It just doesn't add up.'' In engineering an outright win for himself, Fujimori may be gambling that international disapproval will not have long-lasting effects and that unrest at home will soon subside. He is probably wrong on both counts. This is the first time in his decade in power that the Peruvian President has faced such strong opposition both from within and without the country. ''Ordinary people are saying, 'Enough is enough,''' says John Youle, president of the American Chamber of Commerce in Lima. Peruvians tolerated Fujimori's autocracy as long as he delivered security and growth. But the threat posed by the Shining Path guerrillas is now in the past. And increasingly, Fujimori seems unable to produce the sustained economic expansion needed to create a better life for the 49% of the population that is poor. Meanwhile, international discontent at the conduct of the election may translate into a diplomatic cold shoulder for Fujimori. At the extreme, this could lead to a cut-off in foreign aid to Peru. That might serve to put Fujimori, as well as other would-be despots in the region, on notice that dictatorship by the ballot box is no longer an option. Foreign investors could also undermine the regime just by acting in their own interests. Merrill Lynch & Co. senior country analyst Miguel Palomino says that if political and economic conditions in Peru do not improve, foreign direct investment will eventually be affected. Companies that have plowed millions into mining and oil projects cannot easily fold their tents and head home. But those considering fresh outlays may want to rethink their plans. ''The problem is not so much what investors think of Peru's current difficulties,'' says Palomino. ''The bad news is that they might just not think of Peru at all.'' UNREST? Peru may eventually slip off investors' radar screens, but Washington must still figure out how to deal with Lima. The U.S. once looked kindly on Fujimori because of his successes in slaying hyperinflation and crushing terrorism. But for the Clinton Administration, Fujimori is now a potential liability. The Andes are looking dangerously unstable these days: a military-backed coup in Ecuador, a president with a messianic complex in Venezuela, and a civil war raging in Colombia. Add regional recession and soaring unemployment to the mix, and you've got the equivalent of a Molotov cocktail. Thus, the last thing Washington needs is for an intransigent Fujimori regime to inspire unrest. Street protests are already taking place. Real schisms within the armed forces and Fujimori's entourage could leave the President without his bedrock of support. And Toledo, a shoe-shine boy turned economist, has become the standard-bearer the opposition has long lacked. By his flagrant disregard for election rules, Fujimori may achieve what many believed impossible: convincing Peruvians that democracy is not just a luxury of the rich. By Jane Holligan Holligan covers Peruvian politics and economics. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					INTERACT E-Mail to Business Week Online

Copyright 2000-2008, by The McGraw-Hill Companies Inc. All rights reserved. Terms of Use   Privacy Notice