The Stabilisation Crisis in Peru 1975–8

  • Rosemary Thorp
Part of the St Antony’s Series book series


The interest — and the difficulty — of the Peruvian case resides in the fact that it exemplifies in an extreme form the conditions under which even the most short-term targets of orthodox stabilisation policy appear impossible of achievement.1 Since the emergence of acute macroeconomic disequilibrium in 1975, the authorities, under increasing pressure from the international financial community, have struggled to implement orthodox programmes, only to fail time and again to achieve any success even with regard to the balance of payments. At the time of writing yet another attempt has been made (June 1978) of which the outcome is still uncertain — though the analysis of this paper does not leave much room for optimism, without an improvement in external conditions. Failing this, pressures seem likely to grow for a ‘Pinochet’ solution as the only means of dealing with popular resistance to further austerity.


Private Sector International Monetary Fund Foreign Capital Stabilisation Policy Petrol Price 
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© Rosemary Thorp and Laurence Whitehead 1979

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  • Rosemary Thorp

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