Lima: President Ollanta Humala replaced his prime minister on Saturday with a former army officer who was his instructor in the military in a surprise shake-up that could signal a more authoritarian governing style in Peru. (Agencies)
Oscar Valdes, who had been Humala's interior minister, will replace Salomon Lerner, a businessman who was the most powerful centrist in the government and helped Humala shed his left-wing image to win election in June.
Opposition politicians warned the first Cabinet shuffle by Humala, who was a professional soldier before turning to politics, would undermine confidence in a government that took office only five months ago.
"There is no crisis in the government, what's happening is that some adjustments are being made," Valdes said on television. He said he would reappoint Finance Minister Luis Miguel Castilla, who is well-regarded on Wall Street, but he declined to detail broader changes.
Political analysts said the Cabinet shuffle showed Humala would govern with a firmer hand in polarized Peru and leave intact the country's free-market economic model, which depends heavily on foreign investment in the mining and oil sectors.
"Today the president has become an authoritarian strongman, and this is bad," said Cesar Hildebrandt, a political analyst and columnist.
Critics said a more authoritarian Humala would mean less respect for institutions, fewer independent Cabinet officials, and a greater emphasis on law and order.
Humala declared a state of emergency last week in the region of Cajamarca, giving the police and army special powers to quash an environmental protest against a proposed $4.8 billion gold mine he says would create thousands of jobs.
"This confirms the economic model will endure and be prolonged, it's a step sectors on the right will applaud," Hildebrandt said.
The crackdown in Cajamarca, where the Conga project proposed by U.S.-based Newmont Mining would be the biggest investment in Peruvian mining history, was reportedly urged by Valdes to halt a growing wave of protests.
Hundreds of disputes nationwide have threatened to delay $50 billion in planned mining and oil projects that would fuel economic growth for years but have angered rural communities worried about pollution and losing control of scarce water supplies.
Humala won the presidency on promises to steer more social spending to rural areas to help calm social conflicts, while assuring companies their investments would be safe in Peru's surging economy.
Although his approval rating is a relatively high 59 percent, he has struggled to govern as a moderate who can simultaneously help the poor and keep big business happy.
Doubts about Broader Shake-Up
Opposition lawmakers criticized Lerner's departure as premature and said Humala should have kept his original Cabinet together for longer in one of the world's fastest-growing economies.
"We are talking about a prime minister who left before even finishing a year in office. This is a failure," Congressman Mauricio Mulder of the APRA party said on RPP radio.
The Cabinet shuffle also pointed to another pattern: abrupt changes in the political style of Humala, who lost the 2006 presidential election running as an acolyte of Venezuela's socialist president, Hugo Chavez.
"This is worrisome. We've gone from a candidate who was a Chavista to a candidate who was a moderate leftist, to a pro-business president and now, suddenly, a pro-military guy," said Oscar Vidarte, a political scientist at Lima's Catholic University.
The government said all ministers in the Cabinet tendered their resignations after Lerner stepped down. Under Peruvian law, if the prime minister quits, the other Cabinet members must do so as well to give the president a free hand in deciding whether to fire them or keep them in their posts.
The president's office did not say who else in the Cabinet might be replaced but further announcements were expected on Sunday. A government source said Humala asked Lerner to quit to allow him to build more "cohesion" in his ideologically diverse Cabinet.
Humala's mines and energy minister has at times appeared to tussle with the ministers of culture and environment over natural resources projects and indigenous rights.
Besides Lerner, influential centrists include Mines and Energy Minister Carlos Herrera and Trade Minister Jose Luis Silva, who has pushed ahead with an ambitious free-trade agenda that Humala once criticized.
Lima: President Ollanta Humala replaced his prime minister on Saturday with a former army officer who was his instructor in the military in a surprise shake-up that could signal a more authoritarian governing style in Peru.