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History, Return to Democracy

Susana Higuchi, Valentin Paniagua, Vladimiro Montesinos, Velasco era, Alejandro Toledo

Another military coup toppled the Peruvian government on August 29, 1975, after a series of strikes and demonstrations expressed popular discontent with the ailing President Velasco. The following day, General Francisco Morales Bermudez, who had been prime minister and minister of war under Velasco, was sworn in as president. His government announced that the country would be returned to democratic rule in 1980. Morales pledged to continue the ďrevolutionary processĒ begun in 1968. However, the military government was unable to cope with Peruís deepening economic crisis, which was marked by an immense national debt, rampant inflation, and massive unemployment. In 1978 it received a loan from the International Monetary Fund to ease its debt burden, but only in exchange for imposing economic austerity measures, which worsened the lot of most Peruvians.

In 1980, as promised, presidential elections were held. The winner, former president Belaunde, took office in July, when a new constitution came into effect. Belaunde immediately adopted a conservative program that aimed to reverse many of the reforms of the Velasco era, and he began a series of extravagantly costly large-scale construction projects in the rain forest region. Belaunde was immediately overtaken by political crisis and economic disaster. An extreme left-wing guerrilla movement, Shining Path (Sendero Luminoso), began activity in the highlands and gained strength. At the United Statesí behest the government tried to suppress production of coca, the Native Americansí main source of income, and this alienated them still further. Output of the anchoveta fisheries collapsed as a result of ecological devastation from earlier overfishing. The country entered a deep depression accompanied by runaway inflation, and it had to suspend payments on its enormous foreign debt. By the time presidential elections were held in 1985, Belaunde and his government were completely discredited. His party got only 5 percent of the vote.

In the 1985 presidential elections, voters chose the APRA candidate, Alan Garcia Perez. Garcia tried to reverse the economic decline. He introduced policies that attempted to reduce imports and limit annual payments on foreign debts. Despite some temporary success, by 1987 Peru had been cut off from international financing, and inflation again began to increase. In an attempt to limit inflation, Garcia nationalized private banks and insurance companies and tightened government controls over the economy, but by 1990 the annual rate of inflation was approaching 3,000 percent. Meanwhile, despite unabated repression by the security forces, the Shining Path remained powerful.

In an upset in the 1990 presidential election, Alberto Fujimori, an agricultural economist of Japanese descent, defeated novelist Mario Vargas Llosa. Fujimori, who ran in the runoff with left-wing support, imposed an austerity program to deal with hyperinflation and to restore Peruís ability to borrow money internationally. Economic hardship led to an escalation of violence by the Shining Path. In April 1992 Fujimori, alleging that congress and the judiciary had blocked his efforts to suppress the drug trade and the guerrillas, suspended parts of the constitution and took full control of the government. In September several key Shining Path guerrillas were captured, including Shining Path leader Abimael Guzman, and in November Fujimoriís supporters won a solid majority in a legislative election. In 1993 the United States and other creditor nations resumed loans to Peru. In October 1993 Peruvians voted to accept a new constitution, signed by Fujimori in December, that increased presidential power, changed the legislature from a bicameral body to a unicameral one, and allowed Fujimori to run for a second term.

By 1994 Peruís economy had revived dramatically, reaching a growth rate of more than 12 percent that year. Fujimoriís effort to privatize the economy moved forward with the sale of Interbanc, the largest national bank, and the national telephone service to private interests. The country also rejoined the Andean Group just as that group began negotiations to reduce tariffs among member nations. At the same time, the Fujimori government upheld its promise to crush the Shining Path movement, capturing several high-ranking members of the organizationís central committee. In June former UN Secretary General Javier Perez de Cuellar announced that he would run for the presidency. As presidential elections neared, Fujimori lost momentum after feuding publicly with his wife, Susana Higuchi, a critic of his policies, and relieving her of her duties as first lady. In response she formed an opposition party and announced her intention to run for office in 1995. She was denied candidacy when her party failed to assemble the necessary number of signatures.

In January 1995 a series of skirmishes erupted along a contested section of the Ecuadorian border. Fujimori capitalized politically on the situation, gaining wide approval for his refusal to compromise with Ecuador. A cease-fire accord was signed in Montevideo, Uruguay, in March 1995. Peru and Ecuador entered into negotiations in 1998 and, toward the end of the year, signed a treaty settling the border dispute.

Prior to the April 1995 elections Fujimoriís opponents attempted to undercut his popularity by challenging his human rights record. Despite those challenges, Fujimoriís accomplishments overwhelmed his critics at the polls, where he won the presidential elections outright, gaining more than 60 percent of the vote.

Fujimori declared a blanket amnesty in June 1995 for all human rights abuses that may have been committed by members of the Peruvian military or police forces between 1980 and 1995. He pushed the measure through the Peruvian congress without a debate, outraging human rights activists and many Peruvian citizens, and provoking condemnation from governments around the world. The law absolved military personnel or civilians who had already been convicted, who were under investigation, or who were in the process of being tried for alleged crimes.

In November 1995 Peruvian authorities arrested 23 people, including a U.S. citizen, and alleged that they were members of the Tupac Amaru Revolutionary Movement and that they had been planning a terrorist attack on the Peruvian Congress. Tupac Amaru was never as powerful as the Shining Path, but it had been responsible for numerous guerrilla attacks in Peru in the 1980s and 1990s. The trials were conducted in secret, and the accused were unable to cross-examine witnesses, challenge government evidence, or call witnesses on their behalf. All 23 defendants were convicted and many of them were given life sentences. International human rights groups and the U.S. government condemned the trials, saying that they illustrated a lack of justice and due process in Peruís legal system.

In December 1996 Tupac Amaru rebels seized the residence of the Japanese ambassador in Lima, taking hundreds of hostages, including foreign diplomats and Peruvian government officials. The rebels demanded the release of imprisoned comrades, and freed all but 72 of their hostages while negotiating with the government. After a four-month-long standoff, Fujimori ordered a military raid on the mansion to free the hostages. Commandos killed all of the rebels, and one hostage and two soldiers died in the attack.

A series of government scandals damaged the publicís perception of Fujimoriís government during mid-1997. In May Fujimori replaced three Constitutional Court justices who ruled that the congress acted unconstitutionally when it declared him eligible to run for a third consecutive presidential term despite a constitutional prohibition. Evidence also emerged that the government authorized telephone wire-tapping of prominent political opponents and paid Fujimoriís unofficial head of the intelligence service a salary of $600,000.

Fujimoriís public image was further damaged after a television station released information showing that the intelligence service had tortured two women intelligence agents who leaked information to the press about a government campaign to harass journalists. Fujimoriís approval rating dropped to 20 percent as a result of the scandals and the controversy surrounding the replacement of the justices on the Constitutional Court.

A particularly fierce weather pattern known as El Nino struck Peru in late 1997. El Nino, which occurs periodically, caused severe rain and flooding that killed more than 200 Peruvians and caused extensive damage in many regions of the nation. Fujimoriís public image improved after he became personally involved in the crisis, making whirlwind tours to areas of the country that had been ravaged by storms and personally directing measures to control damage. The conflict between the government and the Shining Path continued into 1998, with Shining Path guerrillas engaging in sporadic acts of urban terrorism and attempting to establish or strengthen their bases in rural areas. In March 1998 police in Lima arrested four important leaders in the Shining Path organization.

In his bid for a third term in 2000, Fujimori drew international criticism for alleged campaign abuses and faced a surprisingly strong challenge from Alejandro Toledo, a business school professor. In the April elections neither of the two front-running candidates won 50 percent of the vote, and a runoff was scheduled for May. However, Toledo boycotted the race because of concerns about election fraud, and Fujimori was reelected. In the legislative elections Fujimoriís coalition, Peru 2000, won the most congressional seats but fell short of a majority.

Fujimoriís presidency began to unravel in September 2000 after his intelligence chief, Vladimiro Montesinos, was linked to a corruption scandal. After firing Montesinos, Fujimori called an early presidential election for April 2001 and promised not to run in it. By mid-November Fujimori faced a groundswell of political opposition as new charges of corruption and fraud continued to surface. While Fujimori was abroad for a trade summit of Pacific Rim nations, opposition parties took control of congress and elected a centrist legislator, Valentin Paniagua, as the leader of congress. Fujimori announced from Japan that he would resign as president, and Paniagua was chosen to lead an interim government pending new presidential and legislative elections. In a public rebuke of Fujimori, the legislature rejected the former presidentís resignation and voted to remove him from office for being morally unfit.

Alejandro Toledo was elected president in June 2001 after a runoff with former president Alan Garcia Perez. Toledo vowed to reform Peruís criminal justice system, promote foreign investment, and reduce unemployment. In legislative elections, held alongside the presidential election, Toledoís Possible Peru Party emerged as the largest party in the congress, although it did not attain a majority. The American Popular Revolutionary Alliance (APRA), led by Garcia, became the second largest party.

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