Ramón Castilla

The expansion of Peruvian exports during the 1840s does help, finally, to stabilize the state, particularly under the statesmanlike, if autocratic, leadership of General Marshal Ramon Castilla (1845- 51, 1855-62).

Castilla's rise to power, coming as it did at the onset of the guano boom, marked the beginning of an age of unparalleled economic growth and increasing political stability that effectively ended the country's postindependence decline.

Indeed, to many observers, Peru during the so-called guano age (1845-70) seems uniquely positioned to emerge as the preeminent country in all of South America.

The expansion of Peruvian exports during the 1840s does help, finally, to stabilize the state, particularly under the statesmanlike, if autocratic, leadership of General Marshal Ramon Castilla (1845- 51, 1855-62).

Castilla's rise to power, coming as it does at the onset of the guano boom, marks the beginning of an age of unparalleled economic growth and increasing political stability that effectively ends the country's postindependence decline.

Indeed, to many observers, Peru during the so-called guano age (1845-70) seems uniquely positioned to emerge as the preeminent country in all of South America.

Ramón Castilla, who had been named Peru's Minister of War and Minister of Finance under Agustín Gamarra, has, under the latter post, been responsible for the country's first lucrative guano exportation.

Castilla, along with Domingo Nieto, overthrows President Manuel Ignacio de Vivanco during the Battle of Carmen Alto.

Nieto assumes the presidency under the title "Supreme Director of the Republic".

Ramón Castilla assumes the Peruvian presidency on February 17, 1844 until December 11 of this year, President Domingo Nieto having died a few months after assuming office

After defeating the other caudillos around the country, Castilla reinstates Manuel Menéndez as President of Peru, in order to achieve a constitutional transition to democracy.

Ramón Castilla wins the Peruvian presidential elections in 1845 and is sworn in on April 20.

Peru’s guano export boom is rapidly expanding during this era, largely due to treaties the country has signed with the British company Anthony Gibbs, which had commercialized the guano in Europe.

Important urban projects are also begun under this period, such as the first railroad from Lima to Callao, which will facilitate the transportation of the guano from the production centers ready to be shipped abroad.

Ramón Castilla loses power in Peru on April 20, 1851, after six years in power, and is succeeded by José Rufino Echenique.

Peru also fights two brief but expensive wars.

The first, in which Peru had prevailed, was with Ecuador (1859-60) over disputed territory bordering the Amazon.

However, Castilla had failed to extract a definitive agreement from Ecuador that might have settled conclusively the border issue, so it will continue to fester throughout the next century.

More successful will be the Peruvian victory in 1866 over Spain's attempts to seize control of the guano-rich Chincha Islands in a tragicomic venture to recapture some of its lost empire in South America.

The guano bonanza also sets in motion more negative trends.

Castilla "nationalizes" guano in order to maximize benefits to the state but in so doing reinforces aspects of the old colonial pattern of a mercantilist political economy.

The state now consigns the commercialization of guano to certain favored private sectors based in Lima that have foreign connections.

This action creates a nefarious and often collusive relationship between the state and a new "liberal" group of guano consignees.

This increasingly powerful liberal Peruvian plutocracy soon succeeds in reorienting the country's trade policy away from the previous nationalist and protectionist era toward export-led growth and low tariffs.

Capital investment derived from the guano boom and abroad flow into the export sector, particularly sugar, cotton, and nitrate production.

The coast now becomes the most economically dynamic region of the country, modernizing at a pace that outstrips the Sierra

Coastal export-led growth not only intensifies the uneven and dualist nature of Peruvian development, but subjects the economy to the vicissitudes of world trade.

Between 1840 and 1875, the value of exports surges from six million pesos to almost thirty-two million, and imports go from four to twenty-four million pesos.

On the face of it, the liberal export model, based on guano, pulls Peru out of its post-independence economic stagnation and seems dramatically successful.

However, while great fortunes are accruing to the new coastal plutocracy, little thought is given to closing the historical inequalities of wealth and income or to fostering a national market for incipient home manufacturing that might created the foundation for a more diversified and truly long-term economic de-velopment.