New Peruvian President’s First Disappointing Moves Closely Follow Venezuela’s Playbook

Listen. I wanted to give Pedro Castillo the benefit of the doubt. I really did.

The guy came from nothing—a rural schoolteacher from Cajamarca, one of the poorest regions in Peru. He led the 2017 teachers’ strike. He represents the indigenous population that Lima’s elite has basically ignored for decades. On paper, you want to root for a story like that.

But his first moves in office? They’re not inspiring confidence. At all.

Let’s start with the obvious stuff. Castillo ran on the ticket of Peru Libre, a party founded by Vladimir Cerrón, who’s literally been convicted of corruption and openly admires Hugo Chavez. The party platform called for nationalizing the mining industry (which is basically Peru’s entire economy), rewriting the constitution Venezuelan-style, and pulling out of international trade agreements.

Now look. Campaign promises aren’t always reality. Plenty of populists moderate once they get into office. But Castillo just appointed Guido Bellido as his prime minister—a guy who’s been investigated for terrorism apology and makes Cerrón look moderate. That’s not walking back the rhetoric. That’s leaning into it.

Here’s what worries me about the Venezuela comparisons. It’s not just that Castillo says nice things about Maduro. It’s the playbook.

Step one: convene a constituent assembly to rewrite the constitution. This is exactly what Chavez did in 1999. It let him restructure the entire government, extend term limits, and concentrate power. Castillo has explicitly called for the same thing.

Step two: attack the institutions that might check your power. Castillo has already said he’d “deactivate” the Constitutional Court because he claims it defends corruption. Sound familiar? This is straight out of the authoritarian starter kit.

Step three: blame the elites and international community for everything that goes wrong. Castillo’s been doing this since before he was even inaugurated.

The Washington Post put it pretty well: the question isn’t whether Castillo is a communist (he says he’s not). The question is whether he’ll follow the path of Chavez and destroy the institutions that made Peru one of the fastest-growing economies in Latin America.

Because here’s the thing people forget. Venezuela was wealthy. Before Chavez, before Maduro, before the whole thing collapsed, Venezuela was the richest country in South America. Oil money flowing, middle class growing, democratic institutions functioning. And then Chavez came along promising to help the poor by nationalizing everything and attacking the elites. Twenty years later, five million Venezuelans have fled the country. A million of them ended up in Peru.

Peru isn’t Venezuela, obviously. The economy is different, the political situation is different. Castillo only holds 37 of 130 seats in Congress, so he can’t just ram through whatever he wants. The military isn’t going to help him stage a coup.

But the economic damage he can do is real. The Peruvian sol has already dropped to historic lows against the dollar. Capital flight is accelerating. Investors are spooked. If Castillo follows through on nationalizing mining, foreign investment will crater and Peru’s growth story is over.

The really frustrating part? Peru’s problems are real. The coastal elite really has ignored the interior. Indigenous communities really have been left behind. COVID hit Peru harder than almost anywhere else on earth—highest death rate per capita in the world. People are hurting.

They deserved better options than Castillo or Keiko Fujimori, whose dad literally ran a dictatorship. But that’s what they got. And now they’re stuck with a guy whose idea of helping the poor is copying the country that turned “helping the poor” into the worst humanitarian crisis in Latin American history.

I hope I’m wrong. I really do. Peru deserves better than what I think is coming.