García Introduces First Austerity Measure

Peru’s new president, Alan García, has introduced his first austerity measure in a drive to control spending. The president announced he would be halving his salary and those of Cabinet ministers, congressmen and senior public officials to cut the public wage bill by around $30 million a year. García’s first days in office have been well received by the markets which have been stable to upbeat. President García still has much to prove, though, particularly to those who remember the economic mismanagement of his first term in office (1985-1990), which left Peru with hyperinflation and defaulting on its debt.