Peru

• 24 departments (departamentos, singular-departamento) and 1 constitutional province* (provincia constitucional);
• Amazonas, Ancash, Apurimac, Arequipa, Ayacucho, Cajamarca, Callao*, Cusco, Huancavelica, Huanuco, Ica, Junin, La Libertad, Lambayeque, Lima, Loreto, Madre de Dios, Moquegua, Pasco, Piura, Puno, San Martin, Tacna, Tumbes, Ucayali

note: the 1979 constitution mandated the creation of regions (regiones, singular - region) to function eventually as autonomous economic and administrative entities;

so far, 12 regions have been constituted from 23 of the 24 departments - Amazonas (from Loreto), Andres Avelino Caceres (from Huanuco, Pasco, Junin), Arequipa (from Arequipa), Chavin (from Ancash), Grau (from Tumbes, Piura), Inca (from Cusco, Madre de Dios, Apurimac), La Libertad (from La Libertad), Los Libertadores-Huari (from Ica, Ayacucho, Huancavelica), Mariategui (from Moquegua, Tacna, Puno), Nor Oriental del Maranon (from Lambayeque, Cajamarca, Amazonas), San Martin (from San Martin), Ucayali (from Ucayali);

formation of another region has been delayed by the reluctance of the constitutional province of Callao to merge with the department of Lima; because of inadequate funding from the central government and organizational and political difficulties, the regions have yet to assume major responsibilities;

the 1993 constitution retains the regions but limits their authority; the 1993 constitution also reaffirms the roles of departmental and municipal governments

chief of state:

President Alberto Kenyo FUJIMORI Fujimori (since 28 July 1990); note - the president is both the chief of state and head of government

head of government:

President Alberto Kenyo FUJIMORI Fujimori (since 28 July 1990); note - the president is both the chief of state and head of government

note: Prime Minister Alberto PANDOLFI Arbulu (since 3 April 1996) does not exercise executive power; this power is in the hands of the president

cabinet:

Council of Ministers appointed by the president

elections:

president elected by popular vote for a five-year term; election last held 9 April 1995 (next to be held NA 2000)

election results:

President FUJIMORI reelected; percent of vote-Alberto FUJIMORI 64.42%, Javier PEREZ de CUELLAR 21.80%, Mercedes CABANILLAS 4.11%, other 9.67%

The Peruvian economy has become increasingly market-oriented, with major privatizations completed since 1990 in the mining, electricity, and telecommunications industries. In the 1980s, the economy suffered from hyperinflation, declining per capita output, and mounting external debt.

Peru was shut off from IMF and World Bank support in the mid-1980s because of its huge debt arrears. An austerity program implemented shortly after the FUJIMORI government took office in July 1990 contributed to a third consecutive yearly contraction of economic activity, but the slide came to a halt late that year, and in 1991 output rose 2.4%. After a burst of inflation as the austerity program eliminated government price subsidies, monthly price increases eased to the single-digit level and by December 1991 dropped to the lowest increase since mid-1987.

Lima obtained a financial rescue package from multilateral lenders in September 1991, although it faced $14 billion in arrears on its external debt. By working with the IMF and World Bank on new financial conditions and arrangements, the government succeeded in ending its arrears by March 1993.

In 1992, GDP fell by 2.8%, in part because a warmer-than-usual El Nino current resulted in a 30% drop in the fish catch, but the economy rebounded as strong foreign investment helped push growth to 7% in 1993, about 13% in 1994, and 6.8% in 1995. Growth slowed to about 2.8% in 1996 as the government adopted tight fiscal and monetary policy to reduce the current account deficit and meet its IMF targets.

Growth then rebounded to 7.3% in 1997 even as inflation fell to its lowest level in 23 years. Capital inflows surged to record levels in early 1997 and have remained strong despite economic shocks stemming from the Asian financial crisis and the El Nino weather events.