May 27, 2021 Peruvian elections: a battle of extremes

On May 27, 2021, we held a webinar with Alonso Segura, former minister of economy of Peru. During the session, we discussed the upcoming presidential elections, where candidate Pedro Castillo will face Keiko Fujimori. Castillo is a far-left candidate and has promised a radical shift regarding the orthodox policy path of Peru. On the other hand, Fujimori offers policy continuity; In this context, Peru is facing a battle of extremes.

Mr. Segura believes that Castillo may use public pressure to try to impose his program, an unconstitutional act unless Congress approves a constitutional amendment to allow a full-fledged reform.

Should Fujimori win, Mr. Segura highlighted she would face governing issues and could be the subject of legal processes for alleged misdeeds committed in the past; Castillo could turn the streets to trigger further political pressure.

In our view, Peruvian assets have by now largely, but not fully, priced in a Castillo victory where he moderates his stance once in office.