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The President of Peru, peter castle, announced on Monday that he will replace his prime minister Mirtha Vásquez and will reorganize his moderate leftist cabinet, in a new crisis in the management of the president who will seek his third government team a little over half a year in office.

The decision comes hours after the resignation of the interior minister, Avelino Guillen, who enjoyed the support of the prime minister in her intention to renew high-ranking police officers accused of alleged corruption.

“As I have always announced in my speeches, the cabinet is constantly being evaluated. For this reason, I have decided to renew it and form a new team,” Castillo said on Twitter. “We will continue on the path of development for the good of the country,” he added.

Castillo had announced on Sunday night that he accepted Guillén’s resignation, along with the dismissal of the national police commander, Javier Gallardo, in the midst of disputes over the replacement and promotion of key positions in that force.

It is not clear if Castillo, who took office at the end of July and had appointed Vásquez in October, will ratify any minister of the 19 officials that make up his cabinet of ministers.

The Minister of Economy, Pedro Francke, had earlier shown his support for the resigning Guillén.

“I express all my solidarity with Avelino Guillén, a champion in the defense of human rights. In the cabinet he has been a mainstay in the fight against corruption,” Francke said on Twitter. “I am sure that we will continue to meet in the fight for a better country” said the minister.

Short-term risks

Vásquez calmed investors after two months of strong uncertainty, which sent the local currency to record lows amid concern about the direction of the economy of the world’s second largest copper producer.

In her resignation letter released by Twitter, the now former prime minister stated that she decided to leave the post “given the impossibility of achieving consensus for the benefit of the country.”

The change in the cabinet of ministers will take place in the midst of clashes between Castillo and a Congress dominated by the opposition and that has already tried unsuccessfully to initiate a process of impeachment of the president alleging moral incapacity to govern.

Likewise, the political climate has heated up due to protests against the mining sector and fiscal investigations into alleged corruption and influence peddling within the government environment.

“This should raise the perception of risk in the short term,” former economy minister Alonso Segura told Reuters of the announcement of a cabinet reshuffle.

“Two variables are going to be decisive. The first is how quickly the new cabinet is appointed and how the new cabinet is perceived,” he said. “Second, what is the position of the benches in Congress, if there is a new vacancy attempt (impeachment),” he added.


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