Peru's presidential candidate Pedro Castillo addresses supporters from the headquarters of the "Free Peru" party in Lima, Peru June 8, 2021. REUTERS/Alessandro Cinque
Castillo is close to becoming Peru's next president, after a polarized runoff election against right-wing Keiko Fujimori. Castillo is leading by just 70,000 votes after counting 98% of ballots. To be sure, some 300,000 votes remain contested and could technically sway the election in coming days.Francke said that a Castillo administration would prioritize raising taxes on mining companies and fight corporate income tax avoidance in order to fund increased spending in health and education.
Castillo, an elementary school teacher born into poverty, has flip-flopped on different economic proposals throughout his campaign, including at points saying he would nationalize mining assets. He has also cycled through several rounds of advisers. Peru currently has a large fiscal deficit, which grew wider during the pandemic because strict lockdowns significantly affected tax revenue. While it has a low GDP-to-debt ratio, that has also grown during the pandemic to over 30% by the end of last year."Our vision is to reduce that deficit slowly but we cannot undermine the economic recovery," Francke said, although he added that they did not yet have specific targets for that reduction.
Castillo has also talked about increased protectionism for Peruvian industry, although Francke said that would only be applied in specific instances, citing two: potato farmers and clothing makers.