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Peru received a downward trend arrow due to growing indications of corruption at the highest levels of government.
In 2004, President Alejandro Toledo continued to be the victim of a dangerous paradox that was partly of his own making: the country's economic recovery continued its upward swing amidst a climate of freedom, but his personal popularity plummeted and his Peru Posible party appeared on the verge of disintegration. At mid-year, Peru Posible lost control of the leadership of congress. Meanwhile, the country's broad-based anticorruption drive appeared to run out of most of its steam, as opposition parties and others increasingly decried Toledo's alleged corruption.
Since independence in 1821, Peru has seen alternating periods of civilian and military rule, with elected civilians holding office since a 12-year dictatorship ended in 1980. However, that same year, the Maoist Shining Path guerrilla group launched its two-decades-long insurgency. Alberto Fujimori, a university rector and engineer, defeated the novelist Mario Vargas Llosa in the 1990 election.
In 1992, Fujimori, backed by the military, suspended the constitution and dissolved congress. In November, he held elections for an 80-member constituent assembly to replace the congress. The opposition made a strategic decision to boycott the election, thus ensuring an overwhelming victory for pro-Fujimori forces. The assembly created a constitution - which established a unicameral congress more closely under presidential control - that was approved in a state-controlled referendum following the capture of the Shining Path leader, Abimael Guzman. Congress passed a law in August 1996 allowing Fujimori to run for a third term, despite a constitutional provision limiting the president to two terms. The law evaded this restriction by defining Fujimori's current term as his first under the 1993 constitution.
In the April 9, 2000, presidential election, Fujimori defeated Toledo, a U.S.-educated economist who had been raised in one of the many urban squatter settlements of ex-peasants recently migrated from the countryside, by 49.9 to 40.2 percent. Since Fujimori fell short of an absolute majority, a runoff election was slated for May 28. Toledo refused to participate in the second round, saying that he had been victimized by election-day voting irregularities, repeatedly assaulted by Fujimori supporters in the earlier campaign, suffered constant death threats and phone taps, virtually blacked out from media coverage, and the target of smear campaigns in the press.
In early September, a videotape was released showing Vladimiro Montesinos, the de facto head of the national intelligence service, bribing an opposition congressman at the same time that the spy chief was also being linked to the illegal shipment of arms to Colombian guerrillas. After other similar videos (labeled "Vladivideos") were exposed, the scandal raised suspicions that Fujimori had secured a parliamentary majority - after having failed to win one outright in the April general elections - by bribing opposition congressmen to change sides. In addition, the scandal underscored the fact that official corruption had become systemic. As a result, in late November, Fujimori was driven from office; opposition forces assumed control of congress; and a respected opposition leader, Valentin Paniagua, was chosen as interim president.
Following Fujimori's overthrow, the new opposition-controlled congress began a process of renewing the constitutional tribunal, which had been gutted because some of its members had opposed the third-term law, and reforming the constitution. At the end of 2000, Fujimori announced that he was availing himself of his dual citizenship to remain in Japan (where he lived throughout 2004). In April 2001 parliamentary elections, Toledo's Peru Posible party won 25 percent of the votes, compared to 19 percent garnered by its closest competitor, the Apristas. Running on the slogan "Toledo Trabajo" (Toledo Means Jobs), Toledo bested former Aprista president Alan Garcia (1985 - 1990) in runoff elections held on June. In August, Toledo sacked Peru's top military chiefs and promised to thoroughly restructure the armed forces.
The 2002 reform of Peru's highly centralized political structure gave new regional governments almost a quarter of the national budget and a range of powers that had long been the province of the central government. However, Toledo's standing suffered from a host of personal scandals. In June, antigovernment riots protesting the sell-off of state-owned companies left two people dead and nearly $100 million in damages. The Shining Path also made a small comeback, killing 10 people in a car bomb attack outside the U.S. Embassy in March and making a limited effort to disrupt the November 2002 regional elections. Toledo's government suffered a serious setback at the polls in those elections, as voters selected the main opposition party and a group of independents in contests for 25 new regional governments, whose establishment was meant to end Lima's top-down monopoly on political control.
In August 2003, Peru's Truth and Reconciliation Commission - which Paniagua had appointed in July 2001 - presented its report on the scope and origins of the political violence that had wracked the country from 1980 to 2000. While it concluded that the Maoist Shining Path guerrilla group was the "principal perpetrator of the human rights violations," which included 69,000 people killed, the commission also accused the military and security forces of serious and repeated atrocities. The report shocked many observers by more than doubling the number of deaths estimated to have occurred during the protracted insurgency. The findings showed that nearly three-fourths of the victims of both the guerrillas and the military were residents of Andean highland villages, rural poor who have long suffered neglect at the hand of the central government. In the present political climate of doubt and suspicion, the Commission has not fulfilled hopes that it would finally lay to rest all unanswered questions about these events.
Toledo's popularity appeared to decline further by late 2003, as Peruvians took to the streets in increasing numbers in anger over his questionable ethics and failure to make good on campaign promises of more jobs. The popular disenchantment grew despite the country's posting an annual inflation rate of just 1.5 percent, the lowest in decades, and holding its position as Latin America's economic growth leader.
In 2004, the tenuous hold of Toledo's ruling coalition was weakened even more by Peru Posible's loss of control of congress, including the resignation from the party of two of its founding members, which reduced its parliamentary representation to 36, eleven fewer than in 2001. By midyear, one public opinion survey showed that 70 percent of those polled felt that Toledo - considered on the basis of comparative polling data to be the most unpopular president in Latin America - was himself personally corrupt, and half said they wanted him to leave office early. Some media observers, however, claim that, at least in part, the upswing in public complaints about corruption reflected a tendency by the press, newly freed from the controls and interference of the Fujimori era, to engage in denuncialogia - an obsession with denunciations - that trivializes investigative journalism and helps to poison both political debate and public confidence.
Popular discontent appeared to extend to the entire political process, probably in no small part as a result of the resurgence, as a possible presidential successor, of Garcia, whose own presidency collapsed amidst economic chaos, guerrilla insurgency, and rampant rights abuses. However, control of congress by the hardly more popular opposition, and the increased spotlight on potential successors to Toledo in the 2006 presidential contest, appeared to work against the probability of any extra-legal efforts to seize power in the politically volatile country.
In June, a special anticorruption court found former intelligence chief Montesinos guilty on charges of corruption, sentencing him to 15 years in prison. Nonetheless, in September, the self-exiled Fujimori, wanted in Peru on charges including murder and kidnapping, declared that he would run for president in 2006 - despite being legally banned from holding public office.
In November, old wounds were reopened with the retrial of Shining Path guerrilla leader Abimael Guzman. The new trial for Guzman was the result of a Supreme Court decision questioning the validity of previous trials of accused terrorists in military courts directed by "faceless" judges (whose identities had been concealed to protect them and their families against credible death threats by the Shining Path).] The retrial was suspended, however, after the courtroom was wracked by chaotic scenes, including the trading of accusations between the judge and the prosecutor, that appeared to discredit an already unpopular justice system.
Peruvians can change their government democratically, and the November 2002 elections were held largely without incident. In preparation for the 2001 vote, congress reformed the constitution, replacing a single nationwide district for congressional elections with a system of multiple districts based on the departments (provinces) into which the country is divided for administrative purposes. The move provided fair representation for the almost 50 percent of the population who live outside the four largest cities and guaranteed them at least some attention from the state and from political parties, which traditionally have ignored them.
In March, the government announced that it was dissolving the national intelligence service in the aftermath of a series of scandals. However, witnesses against military wrongdoers, including human rights violators, face threats to their physical well-being. Peru was ranked 67 out of 146 countries surveyed in Transparency International's 2004 Corruption Perceptions Index.
The press is largely privately owned and is now considered to be free. Although the number of threats, including death threats, against journalists has fallen since Alberto Fujimori's presidency, the practice still persists, especially in the provinces. Radio and television are both privately and publicly owned. The government does not limit access to the Internet.
The constitution provides for freedom of religion, and the government generally respects this right in practice. However, the Roman Catholic Church receives preferential treatment from the state. Academic freedom is not restricted by the government.
The constitution provides for the right of peaceful assembly, and the authorities generally respect this right in practice. The human rights community has reported that the Toledo administration continues to work toward strengthening relations between the government and civil society. The government permits numerous nongovernmental organizations dedicated to monitoring and advancing human rights to operate freely. In recent years, these groups reported no harassment or other attempts by the authorities to hinder their operations.
During his period in office, Fujimori conducted a purge of the judiciary that removed 70 percent of judges. He replaced them with new appointees having "provisional" status, meaning that they lacked job tenure and thus were potentially unduly responsive to the government in cases where it had an interest. Since Toledo assumed office in July 2001, the Ministry of Justice has worked to put into place a broad anticorruption effort. However, popular perceptions of the justice system - that it is an inefficient, overloaded bureaucracy riddled by political influence and greed - are hard to change. Scant resources have resulted in most of Peru's more than 3,000 judges being overworked and underpaid, and Toledo's unpopularity results in part from, yet also reinforces, continuing public skepticism about any possibility of institutional reform.
In a positive development, in August 2004, the Constitutional Court, the country's highest tribunal, ordered a full investigation of two notorious 1986 prison massacres. In October 2004, the judicial branch presented the Constitutional Court with a request that it be given budgetary autonomy and a direct subsidy by congress.
Crime is spiraling out of control, and the most obvious contributing factors are the country's economic woes. The National Statistics Institute reports that over half of the population still lives in poverty, which recent economic growth has done little to alleviate. Public safety, particularly in Lima, is threatened by gang warfare and an increase in violent crime; police estimate that there are now more than 1,000 criminal gangs in the capital alone. Conditions remain deplorable in prisons for common criminals. Torture and ill-treatment on the part of the military and security forces remain a concern.
Under Toledo, the government has retained firm control over the military but has yet to embark on many of the necessary reforms of armed institutions that are still suffering from the serious professional deformations promoted by Vladimiro Montesinos, their de facto head under Fujimori. Peru lacks the codified distinction between national defense and internal security that is characteristic of modern, democratic states, and responsibility for internal security is shared between the military and the Peruvian National Police.
Only about 5 percent of the formal sector workforce belong to labor unions, which reflects a legacy of hostility by the Fujimori regime, cuts in the public sector workforce, more flexible labor policies, and other market reforms. In July, national labor unions called the first general strike in Peru since 1999, in protest against alleged public corruption. It received only tepid support and failed to shut down commercial activity in Lima, as had been intended.
Racism against Peru's large Native American population has been prevalent among the middle and upper classes, although the Fujimori government made some effort to combat it. The election of Toledo, who boasted of his indigenous heritage, is considered a watershed. However, the provisions of the 1993 constitution, and subsequent legislation regarding the treatment of native lands, are less explicit about the lands' inalienability and protection from being sold off than were earlier constitutional and statutory laws. The failure of the government to codify aspects of customary law (derecho consuetudinario) into positive law has been accompanied by recent incidents of vigilante violence, including lynchings, in the predominantly largely indigenous highlands.
Spousal abuse is a serious problem, although recently the government has taken some steps to address the issue. Forced labor, including child labor, exists in the gold-mining region of the Amazon. Discrimination against gay and transgender people, including occasional acts of violence, is a problem.