Peru swore in a new president Tuesday who is unknown to most and was recently accused of trying to secure the military’s support for a congressional effort to boot the nation’s last leader out over unproven corruption allegations.
Businessman and former head of Congress Manuel Merino placed his hand on a Bible and swore to carry out the remainder of the current presidential term, which is set to expire in July of next year.
He then donned the red and white presidential sash while wearing a face mask and stood as the nation’s anthem was played.
“This is a difficult moment for the country,” he said. “Today, the country does not look at the future with hope, but with worry.”
Merino’s swearing in was met with protests on the streets of Peru’s capital a day after Congress voted to oust popular President Martin Vizcarra, who had campaigned against corruption. Peruvians widely distrust legislators and decried Vizcarra’s removal as an overt power grab.
Analysts warn the country could be thrown into a new period of instability at the same time as it grapples with one of the world’s worst coronavirus outbreaks.
“It’s a coup d’etat,” taxi driver Paul Mendoza said. “Now we’re going to have inflation, a recession, and we won’t be able to get ahead because of the pandemic.”
The new president is Peru’s third chief of state since 2016; both Vizcarra and his predecessor, Pedro Pablo Kuczynski, were pushed out by the powerful Congress, where neither managed to secure a majority bloc.
Merino hails from the centre-right Popular Action party and is from the province of Tumbes along the country’s border with Ecuador. He served two terms in Congress, the first in 2001, before being elected again this year as part of a new slate of lawmakers voted into office after Vizcarra dismissed Congress in 2019.
In his first remarks, Merino vowed to move forward with the presidential election planned for April 2021, improve health care to ensure the country is better prepared for a second virus wave, boost the economy and crack down on crime.
“We can’t divide the country,” he said.
But outside Congress, Peru’s divide was readily apparent.
Riot police blocked hundreds of protesters against Merino who banged pots and pans as he was sworn into office. A September Ipsos poll found that 72 per cent of Peruvians in urban areas disapproved of the then-chief of Congress. By contrast, 79 per cent said they thought Vizcarra should continue in office.
Legislators first initiated impeachment proceedings against Vizcarra in September, accusing him of obstructing an investigation into possible favouritism in government contracts. Shortly before that vote, local media reported that Merino had reached out to high-level military leaders seeking their backing if Vizcarra was voted out.
The move backfired as many denounced Congress for acting out of line and the removal effort failed. Lawmakers said they didn’t want to destabilize the country during the pandemic upheaval. Merino later apologized to the military but said he had no ill motives.
“There was never any intention to go beyond rule of law,” he said.
Merino took a back seat in the latest effort to oust Vizcarra, this time on allegations that he’d taken more than $630,000 in bribes for construction contracts while serving as governor of a small southern province years ago. This time, Congress overwhelming approved Vizcarra’s ouster.
Though Vizcarra denied any wrongdoing, he quickly agreed to step down.
“History and the Peruvian people will judge the decisions made,” he said.
The speed of the ouster and lack of evidence led some political analysts to warn that Congress could be putting democracy in jeopardy. The removal also points to structural weaknesses within the nation’s political system. Legislators can override a presidential veto with a simple majority and can remove a president on the vaguely defined grounds of “permanent moral incapacity” with a two-thirds majority vote.
“That does make the Peruvian presidency quite weak,” said Abhijit Surya, Peru analyst for The Economist Intelligence Unit. “I don’t think a lot of his supporters were necessarily claiming that he was definitely innocent, but I think they wanted the investigations to play out.”
Several international rights groups expressed concern about the upheaval.
“I’m very worried for the rule of law in Peru,” said Jose Miguel Vivanco, head of the Americas division at Human Rights Watch. He added that while there were reasons to investigate Vizcarra, “the impeachment happened in a very questionable way.”
Many lawmakers justified Vizcarra’s ouster not just on the alleged corruption but also on his handling of the pandemic. They pointed to Peru’s high virus numbers, deadly oxygen shortages and the misuse of rapid antibody tests to diagnose cases even though they can’t identify infection early during an illness. At least 34,879 people have died among 922,333 infected by the virus in Peru, a nation of 32 million people.
“This is something I can never forgive,” lawmaker Maria Cabrera said.
Vizcarra rose to the nation’s highest office in 2018 after Kuczynski resigned amid allegations that he had failed to disclose payments from Brazilian construction giant Odebrecht to his private consulting firm. He made defeating corruption his principal mission and is one of the nation’s most popular leaders in recent history.
But he was unable to make friends in Congress, dismissing lawmakers last year in a brash move cheered by citizens as a victory against dishonest politicians. He has also pushed through initiatives to curb corruption by changing how judges are chosen and to bar politicians with criminal records from running for office.
Numerous lawmakers themselves face criminal probes.
After Merino left Congress, protesters continued to gather in the city’s historic district under a gray sky. Police and demonstrators briefly clashed, with at least one man throwing what appeared to be a plastic bottle at an officer. Authorities sprayed tear gas but the crowd kept marching.
Jo-Marie Burt, a senior fellow with the Washington Office on Latin America, said the impeachment is “terribly destabilizing for Peru.”
“It generates a huge amount of uncertainty at a time when the economy is in a tailspin because of COVID and people are dying,” Burt said.
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Opinion: The Liberal stimulus plan is all about politics – The Globe and Mail
Despite doubling federal spending this year to about $650-billion, Finance Minister Chrystia Freeland is just getting started.
In her fall fiscal update, tabled Monday, Ms. Freeland announced plans to spend an additional $70-billion to $100-billion over three years on a postpandemic stimulus program – with the details to come later. This is on top of promised investments in a national child care program – no cost estimates for that, either – and provincial demands for more health care cash.
Never has a Canadian government spent so much, so fast, or so insouciantly.
While there is broad consensus across the political spectrum that investing in child care is the right move for both economic and social reasons, there is no agreement about whether a stimulus package would be either necessary or effective once the pandemic ends.
The promised stimulus, the details of which could be in the next federal budget, appears to be more of a political move by a minority Liberal government preparing for an election than sound policy based on the need for an injection of yet more public money in the economy.
There has, after all, been record amounts of public money doled out in recent months, much of which has ended up sitting in the savings accounts of thousands of Canadians who saw their incomes rise during the pandemic thanks to Ottawa’s largesse. Canadian businesses are also sitting on huge stockpiles of cash, waiting until the pandemic passes to invest it.
“Redeployment of that cash will have a notable impact on the future trajectory of consumer spending and the economy as a whole,” CIBC economists Benjamin Tal and Katherine Judge said in a Nov. 17 report that pegged the “excess cash” held by Canadians at $170-billion.
Rolling out stimulus spending at the same time consumers and businesses are reopening their wallets would serve no useful economic purpose. It will only add to a ballooning federal debt.
Ottawa will still need to come to the aid of individuals and businesses hardest hit by the pandemic for months to come. But it must begin to do so in a more targeted fashion than it has until now. The pandemic will permanently change the configuration of Canada’s economy and propping up businesses unable to adapt to this change could damage the recovery.
In her fiscal update, Ms. Freeland pointed to recent calls by the International Monetary Fund and Organization for Economic Co-operation and Development for governments to “maintain substantial fiscal support through the crisis and recovery phase, where they have space to do so, including by directly stimulating demand through public investment as a complement to transfer programs aimed at supporting household income.”
Those urgings of the IMF and OECD were not aimed primarily at Canada, which takes the crown when it comes to pandemic-related income supports and other aid measures.
The OECD, for instance, last month found that real household income per capita surged 11 per cent in Canada during the second quarter of 2020. Household income dropped in almost every other developed country outside the United States, plummeting 7.2 per cent in Italy, 3.4 per cent in Britain and 2.3 per cent in France.
For its part, the IMF has reported the combined deficits of Canada’s federal and provincial governments will exceed 20 per cent of the country’s gross domestic product in the 2020-21 fiscal year. The average for eurozone countries is 10.7 per cent. Against this backdrop, the need for additional stimulus here is debatable.
“As economies tentatively reopen, but uncertainty about the course of the pandemic remains, governments should ensure that fiscal support is not withdrawn too rapidly,” the IMF said in a blog post accompanying its October Fiscal Monitor report. “However, it should become more selective and avoid standing in the way of necessary sectoral reallocations as activity resumes”
Public investments in infrastructure should be evaluated based on their long-term economic merits, such as productivity-enhancing and decarbonization measures. Projects that are “shovel ready” often turn out to be a waste of public money.
That was the case after the 2008-09 recession, when the Conservative government of Stephen Harper introduced a $47-billion stimulus program that fell short of its stated goals. Politically motived pet projects got funded, to be sure. But a 2010 Fraser Institute review of the program found that “government spending on infrastructure had little to no effect on Canada’s economic growth during the recovery. Instead, the data demonstrated that private-sector investment and increased net exports were the drivers of economic recovery.”
That conclusion is now being hotly contested by none other than Ms. Freeland and the federal Liberals, who are planning a stimulus program twice the size of the Harper plan.
What could go wrong?
Even based on the most “optimistic” scenario outlined in Ms. Freeland’s fiscal update, federal spending will approach almost 30 per cent of GDP, far surpassing its previous peak of 24.9 per cent in 1982-83, based on fiscal tables going back to 1966. The best-case scenario sees federal spending falling back below 20 per cent next year, and to about 16 per cent (including interest costs) by 2024-25. The fiscal update provided no information about how this will be achieved.
Instead of dreaming up plans to spend more, Ms. Freeland needs to tell Canadians when and how she intends to spend less. Because that day is coming, whether she admits now it or not.
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Even as political relations worsen, Canada-China trade thrives – The Globe and Mail
Canada’s business with China appears to be thriving during the pandemic even as diplomatic relations remain in a deep freeze.
Exports to China increased close to 10 per cent in the first seven months of the COVID-19 pandemic over the same period a year previous, according to new analysis from the Canadian International Development Platform (CIDP), which is part of the Norman Paterson School of International Affairs at Carleton University.
This growth occurred even as exports, by value, to many other traditional customers sunk during the pandemic, which hit Canada in March.
Overall, Canadian exports fell nearly 20 per cent in the same March to September period, CIDP’s analysis of Statistics Canada data shows. For instance, exports to the United States declined 22 per cent in this period.
Exports to China for the March to September period exceeded $14.7-billion, compared with $13.4-billion in 2019.
Aniket Bhushan, an adjunct research professor at the Norman Paterson School, said one of the reasons exports to China are growing is that sales are rebounding from a bad year in 2019 when China punished Canada for arresting Huawei Technologies chief financial officer Meng Wanzhou. China blocked sales of pork and beef for several months in 2019.
Still, Prof. Bhushan said, Canadian exports to China appear to be on track to exceed 2018 levels by the end of this year.
Perrin Beatty, president of the Canadian Chamber of Commerce, said Canadian exports to China are up in 2020 because China’s economy is one of the few that will grow this year. The country, where COVID-19 first appeared, recovered much more quickly than most and is expected to expand economic output by a modest 2.1 per cent this year.
Diplomatic relations between China and Canada have steadily eroded since late 2018 when Canada arrested Ms. Meng on a U.S. extradition request and Beijing locked up two Canadians – Michael Kovrig and Michael Spavor – in what Prime Minister Justin Trudeau has called an effort to exert “political pressure.” Beijing applied, and then lifted, restrictions barring imports of Canadian pork and beef, while Canada’s two biggest exporters of canola seed remain barred from shipping to the Chinese market.
In October, Deputy Prime Minister Chrystia Freeland denounced China’s ambassador to Canada for threatening Canadians living in Hong Kong, saying envoy Cong Peiwu overstepped his diplomatic role when he warned granting asylum to pro-democracy dissidents could jeopardize the “health and safety” of 300,000 Canadians living in the Asian city. Mr. Cong was also reprimanded by the Global Affairs department.
Trade data analyzed by CIDP show rising exports to China include ores, cereal grains such as wheat, meat, animal or vegetable fats, and vegetables. Statistics compiled by the federal agriculture and agri-food department show that in September, for instance, Canada exported 61,570 metric tonnes of pork to China compared with 346 tonnes in September, 2019.
Mr. Beatty, whose organization represents 200,000 Canadian businesses, said the political differences between Ottawa and Beijing should not be allowed to “contaminate our commercial relationships.” He said it “makes no sense for the Chinese to use imports of Canadian agri-food as a weapon” and that “politicizing trade” destroys the benefits of trade.
“Half a century ago, Canada supplied China with wheat when other countries refused to sell to them. It was the right decision, and both Canadian farmers and the Chinese people benefited,” he said.
Gordon Houlden, director of the University of Alberta’s China Institute, suggested that China is being pragmatic in dealing with Canada for economic and political reasons.
“I think there may be a desire not to make things worse on the political side because taking the two Canadians has not worked out and maybe there is a desire not to add economic pressure to the equation,” he said.
In a recent report, the China Institute documented how China is continuing to buy Canadian agricultural goods at a solid pace.
David Mulroney, a former Canadian ambassador to China, said that aside from arresting Ms. Meng – who is fighting extradition to the U.S. in a B.C. court – Ottawa has avoided taking significant measures that might antagonize Beijing.
By comparison, Australia has faced an increasing list of trade reprisals from China after challenging China in ways Canada hasn’t. Australia has banned Huawei from 5G networks, called for an inquiry into the origins of COVID-19, and led a pushback against authoritarian states by enacting a law to monitor agents acting for foreign governments.
Prof. Houlden said it would be unwise for Canada to try to decouple its trade with China. He added that trade accounts for 64 per cent of Canada’s GDP, compared with 24 per cent for the U.S. and 37 per cent for China.
“We are far more export dependent than China and we can’t maintain our prosperity without that, so [the] idea that we can’t or shouldn’t sell to China is not sustainable,” he added.
While Canadian canola seed exports continue to face targeted restrictions from Beijing, the China Institute report said 2020 has been marked by relative gains in both export value and tonnage. The cumulative value of canola seed exports to China has risen by 52 per cent on a year-to-date basis to $976-million. That’s still far below the $2.7-billion in canola seed Canada exported in 2018, however.
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Indian politicians slam Trudeau for 'unwelcome' remarks on farmers' protest – CTV News
Politicians in India are slamming Prime Minister Justin Trudeau for wading into the escalating farmers’ protests in their country.
Tens of thousands of Indian farmers have swarmed India’s capital New Delhi in protest of laws passed back in September which the farmers believe will allow corporations to exploit agricultural workers.
The farmers have been met with tear gas and water cannons upon arriving In New Delhi, but have indicated that they intend to stay in the regions for weeks if necessary.
Trudeau weighed in Monday during a virtual celebration for Guru Nanak Dev Ji Gurpurab, a festival to mark the 551st birthday of Guru Nanak, the founder of Sikhism.
“The situation is concerning and we’re all very worried about families and friends,” Trudeau said during video conference, which was later tweeted by the World Sikh Organization.
“Canada will also be there to defend the rights of peaceful protests. We believe in the importance of dialogue and that’s why we’ve reached out through multiple means directly to the Indian authorities to highlight our concerns.”
Indian Prime Minister Narendra Modi has said the new laws give farmers more autonomy to set their own prices and the ability to sell their products directly to businesses.
Both NDP Leader Jagmeet Singh and British Columbia Premier John Horgan have previously issued statements in support of the Indian farmers, though Trudeau is believed to be the first world leader to make a public statement.
Trudeau’s comments were met with harsh criticism from Indian politicians on both sides of the debate. In a statement, Indian Foreign Ministry spokesperson Anurag Srivastava called the comments “ill-informed.”
“Such comments are unwarranted, especially when pertaining to the internal affairs of a democratic country,” the statement read. “It is also best that diplomatic conversations are not misrepresented for political purposes.”
Priyanka Chaturvedi, an Indian MP and deputy leader for Shiv Sena, a right-wing regional party, tweeted that she is “touched” by Trudeau’s concern, but “India’s internal issue is not fodder for another nation’s politics.”
In an opinion piece on the New Delhi Television website, Chaturvedi called it “unfortunate” that Trudeau is using “India’s internal issue to further his own place in his nation’s politics.”
“In international relations, there are courtesies extended to not comment on internal affairs of a nation, India has always extended it to other nations, we expect the same to be extended to India,” Chaturvedi wrote in the article.
Chaturvedi did add that if the Indian government continues to ignore the protests, the country will open itself up to commentary from other nations.
Raghav Chadha, a spokesperson for the Aam Aadmi Party (AAP), the ruling party in the New Delhi region, echoed Chaturvedi’s comments.
“While we urge (Bharatiya Janata Party) Govt to immediately resolve & accede to farmers’ demands, this remains an internal matter of India,” he wrote in the tweet. “AAP believes interference or commentary from elected heads of other countries are unsolicited & unwelcome. India is capable of handling its own domestic matters.”
With files from The Associated Press
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