Andres Oppenheimer

Odebrecht scandal brought down Peru’s president, but hasn’t hurt other leaders

Peru’s President Pedro Pablo Kuczynski resigned Wednesday just ahead of a vote in the nation’s Congress on impeachment.
Peru’s President Pedro Pablo Kuczynski resigned Wednesday just ahead of a vote in the nation’s Congress on impeachment. Getty Images

Peruvian President Pedro Pablo Kuczynski’s resignation over the Odebrecht corruption case may be welcome as a sign of the strength of Peru’s democratic institutions. But there’s huge irony here: Other Latin American governments — such as Venezuela’s — were much more tainted by the same corruption scandal and haven’t suffered any consequences.

Peru was a relatively small piece of the corruption scandal that shook Latin America last year when it was disclosed that Brazil’s Odebrecht construction firm had paid more than $800 million in bribes to government officials in 11 countries.

According to U.S. Justice Department documents, former Odebrecht head Marcelo Odebrecht revealed as part of his plea bargain for a reduced sentence that, between 2005 and 2015, his company had paid $349 million in bribes in Brazil, $98 million in Venezuela, $92 million in the Dominican Republic, $35 million in Argentina, $34 million in Ecuador, $29 million in Peru, $11 million in Colombia and $10.5 million in Mexico.

But, to this day, only Brazil and Peru have aggressively pursued investigations. Colombia, Argentina and Ecuador are starting to do so now, while Mexico and the Dominican Republic have done very little, and Venezuela has not done anything, anti-corruption advocates say.

“Venezuela is the country that has had the most Odebrecht contracts after Brazil, but there has been no investigation into the Odebrecht case,” says Jose Ugaz, the former president of the Berlin-based Transparency International anti-corruption group. “The former Venezuelan attorney general who tried to investigate it had to leave the country.”

Kuczynski, a former Wall Street banker who had a close relationship with President Trump and was going to receive him on April 13 at the Summit of the Americas in Peru, was about to face an impeachment vote in the Peruvian Congress Thursday on charges that two companies of his had received funds from Odebrecht for consulting contracts over the past 10 years.

He resigned on Wednesday, after the opposition released a video showing his aides offering legislators public-works projects in exchange for voting against the impeachment motion. Kuczynski says that he knew nothing about the Odebrecht payments, but the latest videos sealed his political demise.

Virtually all of Peru’s leading politicians and former presidents have been linked to the Odebrecht scandal. Opposition leader Keiko Fujimori received $1.2 million from the firm, the daily El Comercio reported recently, quoting the testimony of former Odebrecht executive Jorge Barata.

Former President Ollanta Humala is in jail in connection to the case, and former President Alejandro Toledo is in the United States and wanted by Peruvian prosecutors for a previous scandal and for allegedly accepting Odebrecht campaign funds.

Now, Peru is mired in uncertainty. As I wrote this, vice president Martin Vizcarra was flying from Canada — where he was serving as Peru’s ambassador — to Lima, where he is scheduled to take office later this week.

Vizcarra, an engineer who served as minister of transportation and communications and provincial governor of the southern Moquegua province, may have to appoint a new chief of staff, and a new cabinet. There is speculation that he will appoint some anti-Kuczynski politicians in order to have some support in the opposition-majority Congress.

It is unclear how Vizcarra’s appointment will affect the April 13-14 Summit of the Americas, scheduled to be attended by Trump and more than two dozen leaders from across the hemisphere. Kuczynski had made big headlines in the region by disinviting Venezuelan dictator Nicolas Maduro to the meeting.

A well-placed Peruvian foreign ministry official told me that he expects no changes in Peru’s policy toward Venezuela: “When Vizcarra participated as vice president in cabinet meetings where the Venezuela situation was discussed, he agreed with the decision not to invite Maduro if he didn’t hold free elections.”

Ironically, the central theme of the upcoming Summit of the Americas will be to seek better hemispheric agreements to fight transnational corruption. That’s more urgent than ever, given the latest events in Peru. Something is wrong when Peru is thrown into a major crisis because of $29 million in illegal payments from Odebrecht, while there is hardly a whisper about Venezuela, whose top officials got $98 million in bribes from the same firm.

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