History, Liberal Period
Fernando Belaunde Terry, Manuel Odria, Peruvian people, runaway inflation, domestic industries
In the elections of 1956, former president Prado was again victorious. He immediately effected sweeping liberal reforms, but was soon hampered by strikes and riots occasioned by economic instability and runaway inflation. In 1959 the government introduced a program to restrict the outflow of dollars and encourage domestic industries by various means, including facilitating the import of capital goods. By May 1960 the economy had improved markedly, and foreign capital flowed into Peru in the form of loans and development contracts. In October of that year the government won approval of its policy of gradual nationalization of most Peruvian oil-production facilities.
In the presidential elections of 1962 none of the three major candidates, Haya de la Torre of APRA, Fernando Belaunde Terry of the Popular Action Party, and Manuel Odria, received the necessary one-third of the votes to win the election. The task of choosing a president thus went to the newly elected congress. The military, which favored Belaunde, overthrew the government to forestall an agreement between Odristas and the APRA to elect Odria president with an APRA vice-president. A military junta took control. To appease the Peruvian people and foreign governments, the junta promised new elections. The junta installed General Ricardo Pio Perez Godoy as president in July 1962, but deposed him in March 1963.
Elections in 1963 brought Belaunde to the presidency. President Belaunde and the APRA, which dominated congress, competed to introduce reforms. Progress was made in public works and social benefits. However, the government’s programs resulted in budgetary deficits and a spiraling inflation. Belaunde was also unable to create a stable government coalition.
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