Ministerial madness

Castillo appoints Peru’s seventh Minister of Transport in just fifteen months.

Geiner Alvarado, the former Minister of Transport and Communications of Peru, resigned from his position on 15 September, after just one month in post. He was forced out by a vote of no confidence in a Congress plenary session following corruption allegations for rigging public tenders while he was Minister of Housing, Construction and Sanitation. Richard Tineo became Alvarado’s successor a few days ago, having been appointed the Minister of Defence just a month ago. Castillo’s ministerial merry-go-round continues!

Tineo’s appointment marks Peru’s seventh Minister of Transportation since President Pedro Castillo assumed office in July 2021. Since then, President Castillo has appointed 67 ministers across his government, an average new minister every six days, mostly as a consequence of cabinet overhauls. The latest cabinet reshuffle came as the Attorney General Office of Peru opened the sixth investigation into the President himself for allegations of corruption.

“The Ministry of Transport is Peru’s treasure chest,” explained a local infrastructure investor, “it has a gigantic budget for the construction of infrastructure and it is a prime target for corruption. The previous ministers were promoted from within the ministry and it transpires that they have all been involved in some type of corruption while working for the ministry. Castillo will be hoping that, as a military man, Tineo will be scandal-free.”

“The Ministry of Transport is Peru’s treasure chest […] and it is a prime target for corruption.”

Infrastructure investor, Peru

A former trade ambassador for Peru sighed, “The number of ministerial changes is embarrassing for Peru. Unfortunately, most of Castillo’s ministerial appointments have been political rather than technical so there is always some kind of scandal involved and corruption is rife in Peru’s Ministry of Transport.”

“Most of Castillo’s ministerial appointments have been political rather than technical so there is always some kind of scandal involved.”

Former trade ambassador, Peru

The main objective of the new Minister of Transportation is to complete the 2019-2025 National Infrastructure Plan (“PNIC”), which has been completed by 20% in three years. The PNIC requires USD 28.83 billion in investments and, as of April 2022, only 24 projects included in the plan have been tendered, representing USD 738.40 million.

Pedro Herrera, chief economist at the Private Competition Council of Peru (“CPC”) said that the ministry had to unblock the remaining 22 projects on hold, which add to USD 19 billion. He added that, as responsible for the compliance with deadlines and the transfer of funds, the administration should prioritise the hiring of managers in key positions for project management.

His concern was echoed by the former trade ambassador, “Peru’s transport sector and associated infrastructure is terrible. Contracted works are stuck and corruption is all over the place meaning no progress has been made in the past two years. The lack of leadership and technical knowledge in the sector is shocking. Tineo will have a lot on his plate.”

In recent years, the agenda of the Ministry of Transportation has been hindered by Peru’s political instability with five presidents in six years. Since taking office in July 2021, President Castillo has been unable to revert this trend and has sent contradictory messages to investors which have diminished market confidence.

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