- The Washington Times - Tuesday, June 5, 2001

LIMA, Peru — Perus president-elect was swept to power largely by the poor, Indian majority. Now Alejandro Toledo faces the daunting task of not letting them down in one of South Americas most troubled nations.
The self-styled "Indian with a cause" must battle a four-year recession, deliver jobs and higher wages in a nation mired in poverty, and root out the remnants of corruption left by a previous government.
Mr. Toledo, 55, became Perus first freely elected president of Indian descent on Sunday when he defeated former President Alan Garcia in an election international observers described as a model for the region. With 89 percent of the vote counted Monday, Mr. Toledo had 52 percent compared with Mr. Garcias 48 percent.
"I am conscious that we are taking on a responsibility in a country with huge social expectations, with an economy in a very difficult situation, in a moral hole," Mr. Toledo said Sunday night.
"We will search for ways to find some financial breathing room that lets us make the paralyzed engine of the economy start to produce, generate jobs, bring income and oil the wheels of production."
Mr. Toledo, who takes office July 28, has a history of overcoming adversity. A former shoeshine boy, he went on to study at Stanford University and become a World Bank economist.
In an odd pairing, his win was welcomed both by the nations Indians and international investors who remember Mr. Garcias economically disastrous 1985-90 administration. Mr. Garcia had refused to fully pay Perus foreign debt, tried to nationalize Perus banks and left office with annual inflation topping 3,000 percent and the nations coffers empty.
Investor reaction to Mr. Toledos win was immediate. The value of a key Brady bond increased 7.2 percent in early trading yesterday — the biggest gain in at least two years.
In his victory speech, Mr. Toledo said he would strive to create jobs and reduce the poverty that afflicts more than half of Perus 26 million people while meeting the obligations on the countrys $19.2 billion foreign debt.
"We imagine that foreign investors are definitely going to give Toledo the benefit of the doubt," said Federico Kaune, a Peruvian-born analyst with Goldman Sachs in New York.
Eduardo Stein, leader of the observer delegation for the Organization of American States, praised the election.
"I think the rest of Latin America will have to examine and study carefully these Peruvian paths to solve political crisis without confrontation or firing a shot," he said.


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