Social Unrest Raises Short-Term Risk

August 2007 | Risk Summary

In his first state-of-the-nation address on July 28, Peruvian President Alan García set out ambitious targets for reducing poverty. García also acknowledged his government's failure to respond rapidly enough to the country's social demands, which has resulted in large-scale social unrest in recent months. The proportion of Peruvians living on less than US$1 a day increased from 44% to 47% between 2004 and 2006. This continues to weigh heavily on our long-term political risk ratings, with income distribution and poverty scoring 3 out of 10 and 4 out of 10 respectively. Furthermore, the recent upsurge in political unrest has also

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