Alfredo Thorne, principal director at Thorne & Associates and former Peruvian finance minister: “As the presidential election approaches, investors are mulling the risks to the economy and the financial system. In the 2021 election, the banking system withstood the shock of electing a left-wing candidate who wanted to turn Peru into an autocratic left-wing regime like Cuba or Venezuela. Investors transferred wealth abroad, and $16.5 billion (about 8 percent of Peru’s GDP) in short-term capital flows poured out of the country. Subsequently, the political shock moderated, and some of these funds were brought back. Predicting the 2026 election, where about 70 political parties are expected to compete, may be a daunting exercise. Political risk is expected to remain high. But the economy and financial system seem more insulated than in 2021. The central bank holds $70 billion…”