New Peruvian President Humala Promises Poor His Priority

Peru's newly sworn-in President Ollanta Humala waves people from an open car outside  the National Congress in Lima, Peru, Thursday July 28, 2011. Sworn in on Perus Independence Day, the 49-year-old former army lieutenant colonel won office in a runoff last month. (AP Photo)

Peru's newly sworn-in President Ollanta Humala waves people from an open car outside the National Congress in Lima, Peru, Thursday July 28, 2011. Sworn in on Perus Independence Day, the 49-year-old former army lieutenant colonel won office in a runoff last month. (AP Photo)

Peru's new President Ollanta Humala promised in his inaugural address Thursday that his main priority is to help one in three Peruvians still mired in poverty.

The 49-year-old leftist military man, who won Peru's president after abandoning a radical platform, made an impassioned speech charted a plan for spreading the wealth from Peru's mineral boom beyond Lima, where it has long been concentrated among a small elite, to long-neglected hinterlands.

"Peru's peasants and the poor in the countryside in general will be the priority," Humala said in remarks before a newly installed Congress and dignitaries who included 11 presidents, almost all from South America.

He quoted South Africa's anti-apartheid hero and former president, Nelson Mandela, in arguing there can be no democracy where misery and "social asymmetry" persist.

Humala's will be a daunting juggling act: He also signaled his intention to maintain the business status quo and honor all international pacts, including a raft of free-trade agreements enacted by his predecessors.

To reassure foreign investors, Humala retained the incumbent central bank chief, Julio Velarde, and named as finance minister Luis Miguel Castilla, a deputy finance minister for the past year and a half in the outgoing government of President Alan García.

The Cabinet is dominated by moderate technocrats but also includes, as culture minister, the renowned singer Susana Baca. She is Peru's first black Cabinet minister.

Humala didn't explain how he planned to pay for the generous social programs he catalogued on Thursday, most of which he promised during the campaign, though he has said he intends to seek taxes on windfall mining profits.

The pledges include guaranteeing old-age pensions for all Peruvians at age 65; raising the minimum monthly wage to $270 by next year; and building hospitals in 50 cities where they're lacking.

The president also has promised to invest more in public transportation in the traffic-choked capital of Lima; to expand highways and railways; to rebuild Peru's merchant marine, and to re-establish a national airline. Aeroperu went bankrupt in 1999.

He also said he would dedicate more natural gas from the Camisea field for domestic use rather than export, and has promised to lower natural gas prices, although he wouldn't offer a target price Thursday.

Humala won't have an easy time in Congress, where his party has just 47 of 130 seats and will have to depend on lawmakers from the Peru Posible party of former President Alejandro Toledo for a majority.

The main opposition in Congress comes from the Fujimori camp, the second-biggest voting bloc. Humala narrowly defeated Keiko Fujimori, daughter of imprisoned former President Alberto Fujimori, in a June 5 runoff.

The Fujimoristas tried to shout down Humala when, during his swearing-in, he said he was assuming power in the spirit of the 1979 constitution. That was a snub to the 1993 magna carta passed under the autocratic regime of Alberto Fujimori, who is serving a 25-year prison term for authorizing death squads and corruption.

The 1993 constitution specifies a reduced state role in the economy, justifying Fujimori's wave of privatizations of state-owned companies.

Humala received warm greetings from fellow leftist Presidents Evo Morales of Bolivia, Rafael Correa of Ecuador and Cristina Fernandez of Argentina. The United States sent Dan Restrepo, the top Western Hemisphere official in the White House.

The nascent UNASUR defense bloc of South American nations was to hold a brief meeting Thursday afternoon. The presidents of Colombia, Brazil and Chile, all in attendance, are key players in that group.

Venezuelan President Hugo Chávez, who closely supported Humala in his failed presidential bid in 2006, did not make the trip. He is recuperating from chemotherapy after having a cancerous tumor removed last month from his pelvic region. Chávez sent his congratulations in a Tweet from Caracas.

García, who narrowly defeated Humala in the 2006 race, broke with tradition and opted not to attend Thursday's inauguration. He quit the presidential palace more than an hour before his successor's swearing-in, getting into a black SUV with tinted windows and departing without any applause from onlookers.

The 62-year-old, pro-business García had announced several days earlier that he didn't expect to attend. He said it wasn't out of disrespect for Humala but to prevent a recurrence of the unpleasantness of 1990, when his first term ended.

At the time, Congress erupted in catcalls when García handed over power to Alberto Fujimori. His first term had been a disaster. Peru was in the throes of hyperinflation and bleeding from a fanatical leftist insurgency.

García left Peru in considerably better shape this time, with economic growth averaging 7 percent during his five years in office, low inflation and $47 billion in international reserves. Peru's poverty rate dropped from 48 percent to 31 percent on García's watch, according to government figures.

But the numbers don't illustrate the great disparity of wealth between those on Peru's coast and in the interior, and critics complained of rampant corruption.

The World Bank says that in Peru's rural highlands, where support for Humala was strongest, the poverty rate is as high as 66 percent. Humala won more than 70 percent of the vote in several highland states in the June 5 election.

Based on reporting by the Associated Press.

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