Labour law reverse wounds Peru's Humala

Significance

Jara is under strong pressure from opposition groups in Congress to sack at least two key ministers, those of the interior and defence. This follows the drubbing received by the Humala administration when forced to repeal its youth employment law on January 26.

Impacts

• The next 18 months will be ones of political instability.
• The outcome of the 2016 elections is unclear, though a business-friendly administration is likely to emerge.
• The salience of corruption in Peruvian politics will probably increase.