Allegations Against Toledo's Aides Follow Pledges to Root Out Corruption

By Scott Wilson
Washington Post Foreign Service

LIMA, Peru, Feb. 4 -- President Alejandro Toledo, who has made fighting official corruption in Peru a central element of his administration, has been weakened in recent months by ethics scandals involving several of his key advisers.

Since the end of November, four cabinet members have been removed from Toledo's government following allegations of influence-peddling and nepotism, prompting Toledo's critics to dub him "the incredibly shrinking president." Among those who have left is Toledo's popular prime minister, Beatriz Merino, who was widely viewed as one of the few independent voices inside the administration.

The allegations, which have pushed Toledo's approval ratings into the single digits for the first time in his 30-month tenure, have mounted in the last week.

One of Peru's two vice presidents, Raul Diez Canseco, resigned Friday facing accusations that he granted tax breaks to his girlfriend's father while serving in Toledo's cabinet. The next day, a judge placed Cesar Almeyda, Toledo's former head of intelligence, under house arrest for allegedly conspiring with a central figure in the corruption case against former spy chief Vladimiro Montesinos.

"It is clear this is an isolated incident which does not involve the government," Toledo said of the Almeyda case in a national address on Saturday evening. "I reiterate that anyone who is corrupt is my enemy and the enemy of my government."

The ethics scandals have pushed Toledo from the political high ground he assumed on taking office in July 2001, when he promised to root out the corruption that had characterized two previous presidencies. Members of his own political party, alarmed by recent opinion polls that show Toledo with less support than any other Latin American president, have called on him to shuffle his cabinet and acknowledge his mistakes.

Toledo's approval ratings have rarely exceeded 20 percent since he was elected. But he received the support of just 7.3 percent of Lima residents responding to a poll released Monday. Nearly three in four respondents said they blamed him most for failing to fulfill campaign promises to end corruption, create thousands of jobs and combat the poverty that afflicts more than half of Peru's 27 million people.

The decline in support comes at a delicate moment for Toledo, a former World Bank official whose management of the economy has led to relatively brisk growth.
His political weakness has stalled a tax reform measure in Congress and threatens his ability to sell the public on bilateral trade talks with the United States, which he
says are essential to sustain Peru's economic successes.

Although the economy has grown in all but one month since Toledo took office, few Peruvians have reported a rise in income. Much of the economic growth has
come from increased exports in such sectors as mining, an industry largely controlled by foreign companies, with only a small share of the profits reaching Peruvians.
That, among other issues, has made free trade difficult to sell to the public here and across the Andean region. Peru is scheduled to begin negotiations in March with
the Bush administration, which has placed free trade at the top of its agenda for Latin America.

"The economy is in good order, and there are good prospects this year with tourism, construction and exports rising," said Gustavo Gorriti, a political analyst and
former Toledo ally who has become one of his sharpest critics. "By the standard of Latin America, Toledo has been one of the best performers. But it is like a
person with good health signs but a psychological illness. His problems exist because of political and management defects."

Toledo has blamed many of his problems on the legacy of Alberto Fujimori's decade-long presidency. Fujimori, who abandoned his office and fled to Japan in
November 2000, is wanted in Peru on charges that include corruption and human rights violations.

In his speech Saturday, Toledo suggested that the timing of the corruption allegations against his government is evidence that Montesinos, Fujimori's closest
confidant, continues to wield enormous influence from his prison cell. Montesinos is standing trial for allegedly orchestrating the delivery of 10,000 assault rifles to
Colombia's largest guerrilla group, the most serious charge he has yet to face. He has already been convicted on a number of other charges.

His defense has alleged that the CIA knew of the shipment and is seeking the testimony of George J. Tenet, the agency's director. The trial was suspended Thursday
pending the arrival of a co-defendant.

The next day, a Lima newspaper published transcripts of a tape purportedly revealing a 2001 meeting between Almeyda, who was Toledo's attorney at the time,
and Gen. Oscar Villanueva, who allegedly collaborated with Montesinos and accepted money from him. Almeyda was named intelligence chief a year later; if
verified, the meeting would implicate a member of Toledo's government in the Montesinos case for the first time.

The transcript suggests Almeyda and Villanueva, who committed suicide in 2002, were discussing which of three possible judges would hear the general's case on
corruption charges. Almeyda, who has denied the allegations against him and questioned the tape's authenticity, suggested at one point that two of the judges were
"more or less under control," according to the transcript. Toledo has ordered an investigation.

The corruption allegations have prompted several opposition lawmakers to call for Toledo to resign halfway through his five-year term -- something the president has
never acknowledged as a possibility -- and propose that the 2006 elections be moved up.

"The government has entered a complicated phase that could easily become its terminal phase," said Jorge del Castillo, a leader of the opposition APRA party's
congressional bloc. "If Toledo's support continues to deteriorate, falling into the 4 or 5 percent range, he will have lost all legitimacy. In that case, resignation is the
best way to ensure a constitutional solution to this crisis."

Toledo's congressional allies have also recommended that he take decisive steps in the coming days to address the corruption allegations, including bringing in new
cabinet members from outside the ruling party. Jacques Rodrich, a congressman from Toledo's Peru Possible party, said he continued to support the president
because of his deft economic management, and praised him for refusing to follow Peru's fiscally damaging populist tradition in order to boost his poll numbers.

But Rodrich acknowledged that "the mafia," the term Toledo uses to describe those who prospered politically and financially under Fujimori, is not to blame for all of
the president's troubles.

"There is much discipline on the economic side, but at the same time a huge lack of discipline on matters that give a government credibility," Rodrich said. "He needs
to address this urgently. There are two types of presidents -- those who like to hear adulation and nothing more, and others who like to hear how to improve. For
too long he has listened only to what is convenient."

                                               © 2004