Elmer Cuba: Peru's Political and Economic Disconnect Hinders Development

Elmer Cuba, who served as Economy Minister in Keiko Fujimori's proposed cabinet, discusses the persistent disconnect between Peru's stable macroeconomy and its underdeveloped social well-being and institutions. In his book, "Perú: el desarrollo esquivo" (Peru: Elusive Development), Cuba analyzes over 200 years of Peruvian history, highlighting the intricate relationship between politics and economics. He argues that while Peru's economic system, designed around a nearly 35-year-old constitution, has functioned well, the political system has continuously degraded without sufficient safeguards. Cuba notes that Peru has rarely experienced periods where strong politics and sound economic management aligned simultaneously. He points out that Peru's founding as an independent nation, intended as a republic of equals, was hampered by a society where 80% of the population was indigenous and did not speak Spanish, a fundamental issue of social cohesion that remains unresolved. While political inclusion has advanced significantly in the last 50 years, with recent elections demonstrating this, and economic inclusion allowing for greater entrepreneurial opportunity, social cohesion remains a major challenge. Cuba observes that voting patterns still reflect socioeconomic divides rather than ideology, indicating a lack of national unity. He emphasizes that despite absolute economic progress, Peru's per capita GDP relative to countries like the United States, Spain, and Chile has not significantly improved over its 200-year history, suggesting a lack of relative development. Cuba identifies poor public services in education and health as key impediments to social cohesion and equitable opportunities, citing the potential rollback of programs like Beca 18 as detrimental to human capital investment.