The weight is over: Searching for equilibrium in business-state relations in Peru

Simultaneous harmony and conflict have historically characterized business-state relations in Peru. Large, successful firms have almost always enjoyed close relations with the traditionally patronal Peruvian state, while the more unfortunate firms, lacking political connections, have languished. Alberto Fujimori's election in 1990 promised to bring new challenges and responsibilities to the Peruvian business class, but by late 2000, the honeymoon seems to be long over. Supported by numerous interviews with public and private sector actors in Peru, this study analyzes the strengths and weaknesses of these two sectors and the resultant effects they have on relations between business and the state. Particular attention is paid to the organizational attributes of the state and key business associations, recognizing that structure strongly affects the range of possible outcomes. Reforms on both sides of the relationship, suggested here, are necessary if Peru wishes to avoid serious political and economic consequences.