The second round of Peru’s Presidential election on Sunday 7th June has resulted in a victory for the radical nationalist Ollanta Humala.

This followed the first round on April 9th which resulted in a political earthquake in the sense that the three major candidates of the bourgeoisie were defeated. The run off was between the two least favoured candidates of the ruling class - the former left nationalist Ollanta Humala, and the daughter of the former authoritarian president Alberto Fujimori, Keiko.

Until the final day of the election on the first round the press attempted everything they could to prevent this electoral result: they launched desperate appeals to “save democracy”, various attempts to eulogize the traditional parties, and in the end a fierce campaign, especially aimed against Humala. Despite all this effort, Ollanta Humala came in first with about 31,5% of the vote, followed by Keiko Fujimori who convinced 23,5% of the electorate. The cause of this defeat was that all three candidates defended a policy that would be a continuation of the disastrous neoliberal policy of the current Peruvian government: all three put forward that they would maintain the current economical growth in the country (10% in 2010) through a continuation of the actual economic policy.

Economic growth, but no progress for working class and poor

This economic growth however is mostly based on the international speculation on the commodities Peru exports: gold, silver, copper and zinc. On the international markets, the price of gold has doubled the past five years, in three years, the price of silver tripled, and the price of copper has increased fivefold over the past two years. In volume, the growth in the export of commodities is much smaller: the export of metals in Peru scarcely doubled in the past ten years, while Peru’s revenues based on these exports increased fivefold over the same period. The fact that this growth is very fragile became clear in 2009: due to a temporary collapse of commodity prices on the international markets, economic growth in Peru fell from 9% in 2008 to 0.9% in 2009, to increase again to over 10% in 2010 once the markets had recovered. More important is that the growing export revenues did not stimulate a growth of the internal market in Peru: when we consider the real purchasing power of the Peruvian population (in Implied Purchasing Power Parity PPP and the GDP is based on PPP), we see that purchasing power fell back over the past ten years. On top of this, the recent economic growth has further increased the gap that exists between rich and poor in the country. Added to this, the international speculation on food provoked a strong increase of basic goods like food. The national Bank reported that between 2002 and 2008, food prices rose over 9,8%.

The future of the Peruvian economy was an important theme in this presidential campaign, and Toledo, Kuczynski and Castañeda all made clear they did not want to interfere with the “free market”. It means that companies looking for new exploitation of Peru’s natural resources can continue to destroy the environment and the Amazon forest and pollute rivers. It also means that the millions of Peruvians who make a living in the “informal economy” and the over 10 million “extreme poor” in the country have no prospect whatsoever of seeing their living conditions improve in the coming years.

Political pounding of the traditional parties

The anger that this situation provokes can clearly been seen when we look at the election results of the ruling party APRA in these elections. APRA was originally a populist radical organisation which supported a union between the working class and progressive layers of the bourgeoisie in Latin-America, in order to create a unified Latin-America against imperialism – especially Us imperialism. APRA was banned until 1956 (and again under the military junta from 1968 until 1979). Yet it was even before its legalisation the most important political organisation in the country. At the end of the 1980s, the party reformed itself on the model of the Western-European social-democrat parties and embraced the most pro-capitalist policies of those organisations. President Alan Garcia, who was president for 5 years in the late 1980s, continued to reform the party over the past years to the point that it is generally considered today as one of the more centre-right parties in Peru. The result is that the trade union federations broke with APRA and switched to back the nationalist populist, Ollanta Humala. APRA plummeted so strongly in the polls under the presidency of Alan Garcia, that it was not capable of proposing a presidential candidate from its own ranks. In the elections for the Congress, held at the same time as the presidential elections, APRA was decimated from 36 to 4 seats. This is an historic defeat for the party and poses a question over the very survival of this party.

The victory of Ollanta Humala

Ollanta Humala, a former military officer who, until recently, modelled himself, on Hugo Chavez in Venezuela emerged as victor in this election. A couple of months before the election, Humala started to distance himself from Chavez, and allied himself with former Brazilian president Lula. The links between both politicians have grown so close that Lula sent some of his former campaign staff to Peru to assist Humala in creating a less radical image. The red Chavez shirt was changed to a suit and tie, the harsh language against US-imperialism was changed to a vague discourse about “promoting the internal Peruvian market against foreign multinationals”. Following his election he has now declared to cheering crowds that “a great transformation” would see a more equal distribution of wealth while “respecting market capitalism”.

Humala won massive support amongst the most combative layers of the working class which could not be rivalled by any of the other candidates. He was perceived as a radical left candidate despite his clear swing towards the right in the run up to the elections. The hatred which existed towards the main capitalist candidates was channelled into support for him. When the former President Alejandro Toledo arrived in Arequipa one week before the elections, he was booed by the population and pelted with stones. The masses screamed slogans against the privatisation of the local electricity network in 2002 by Toledo, a decision that provoked at the time a strong movement that still rests in the collective memory of the Arequipeños.

What alternative does Humala offer?

The question to be asked however is what alternative Humala really represents: he describes his economic alternative as the defence of the “internal Peruvian market” against the foreign free market. This means concretely that he expects more tax contributions from foreign companies active in Peru, and he states that, if it is necessary, he is prepared to carry out some limited nationalisation, especially in sectors like the mining industry, oil–and gas exploitation, and certain utilities, Sectors of the economy that are today controlled by foreign multinationals. He argues that he wants to give more openings to “Peruvian entrepreneurs”, and wants to strengthen the “internal market”. This attitude reflects the policies that exist today in Venezuela and Bolivia: a policy of limited partial nationalisation but remaining within capitalism. Such a policy has resulted in the continuation of capitalism and attacks against the working class and poor and an erosion in the support for both these regimes.

Another important aspect of Ollanta’s programme is the demand for a reform of the constitution. Humala states that when elected, he will call for a Constitutional Assembly that will draw up a new constitution for Peru that will bring more social and economical equality.

He remains however vague on how the new constitution should look like, or how this Constitutional Assembly should be composed. This demand for a change of the constitution is a point that is often put forward in struggles of the working class. Many workers want a change in the property relations in the country: the nationalisation of key sectors of the economy, and a democratic control by workers and peasants over the economy and the wealth of the country. Such demands go much further than the changes Humala wants to press through. Many workers and activists hope that their struggle could push Humala to go much further than he intends.

This opens up the prospect of major struggles in Peru in the next months and years as the hopes and expectations of the masses are dashed if Humala follows the Lula road but without the economic growth that Brazil has experieinced in recent years.

The workers movement needs its own organisations and programme

It is important that the workers movement in Peru takes the initiative to build a political alternative. The demand for constitutional reform should be concretised to a demand for real reforms including nationalisation of the mining sector, oil–and gas exploration, the banks and the key sectors of the economy. This should be linked with a fighting programme to struggle for a free and qualitative education system and a national health service in Peru, to offer a substantial increase in the minimum wage to 2.000 soles monthly, and an automatic indexation of the salaries with the increase in food prices. There should be a regularisation of the informal economy on workers’ rights and salaries, a national agricultural reform programme that would offer poor farmers a fair price for their products, and that will offer food at affordable prices to the population. The movement for a new constitution should be transformed into an active political movement of combative militants of the workers’ movement that form committees in factories, villages and neighbourhoods. These committees can play an important role in enlarging the struggle that is already taking place today, and could offer a concrete alternative to those poorest layers of the population that today remain outside of the political life in Peru. The Constitutional Assembly should be made up of representatives that are democratically elected by these committees, and the Assembly should form a government of workers and poor peasants, that will execute the described reforms. Such a government will be performing a real socialist policy, independent of the multinationals and of the Peruvian bourgeoisie. Only this democratic socialism, in which the wealth in society is under democratic control of the workers’ movement, would permit such a policy.

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