Peru cabinet moves may see short-term political truce

Significance

In selecting new members of his ministerial team, President Pedro Pablo Kuczynski has sought to appease the pro-Fujimori opposition in Congress without giving them a role in government. Whether or not a lasting rapport can be achieved will depend on the political skills of the new premier, Mercedes Araoz.

Impacts

• The new cabinet will find it difficult to shake off the problems that afflicted its predecessor.
• Growth this year and next is likely to be subdued.
• Investment will only pick up if there is a sustained increase in commodity prices.