Peruvian president's ties with powerful opposition party sour

LIMA (Reuters) - For the first few months of Peruvian President Pedro Pablo Kuczynski’s term, the right-wing populist party he narrowly beat in June’s election helped his technocratic government push out an initial raft of reforms.

Peru's President Pedro Pablo Kuczynski holds a news conference at the conclusion of the APEC (Asia-Pacific Economic Cooperation) Summit in Lima, Peru November 20, 2016. REUTERS/Paco Chuquiure

But the tenuous ties between the two are rapidly unraveling as the opposition-controlled Congress prepares to oust his education minister on Thursday, despite Kuczynski’s pleas to spare him, raising the prospect of increasing political instability in one of Latin America’s fastest growing economies.

Just five months into Kuczynski’s five-year term, the battle over Education Minister Jaime Saavedra has exposed Kuczynski’s vulnerability to his defeated rival Keiko Fujimori, daughter of jailed former authoritarian leader Alberto Fujimori.

Fujimori has declined to meet with Kuczynski since losing her second bid for the presidency and has commanded her Popular Force party from behind the scenes, heaping praise on lawmakers who railed against Saavedra in a hearing last week, according pictures of a cellphone chat taken by the Correo newspaper.

“Now they know who they’re messing with,” Popular Force lawmaker Cecilia Chacon responded in the chat, later adding publicly that she was referring to corrupt officials.

Popular Force has said Saavedra, a former World Bank economist whom Kuczynski reappointed from the previous government, must leave office because of allegations of corruption in a contract for school computers on his watch.

But Saavedra’s supporters said Popular Force lawmakers want to halt tougher standards for private universities and have put him in their crosshairs to flex their muscles.

Thousands of Peruvians marched in Lima to back Saavedra on Monday, some calling for Kuczynski to dissolve Congress.

Kuczynski said he would not turn the vote on Saavedra into a vote of confidence on Prime Minister Fernando Zavala, a move that could limit Popular Force’s ability to threaten him. Presidents in Peru can order new congressional elections if lawmakers oust the prime minister twice.

“We’ve decided to avoid a scenario of greater confrontation,” Kuczynski said in a TV and radio message to Peruvians late on Tuesday. “The campaign ended seven months ago. Now we have the tremendous task of governing Peru.”

Opposition lawmakers said afterward that they would still support the motion to force Saavedra from office.

Kuczynski, a former Wall Street banker, wants to bolster domestic demand with infrastructure investments ahead of an expected slowdown in growth in 2018 when surging copper output from new mines will subside. Popular Force tends to back business-friendly policies.

Reporting By Mitra Taj; editing by Grant McCool