Peru president refuses to resign amid threat of impeachment over graft

Peru's President Pedro Pablo Kuczynski late on Thursday rejected demands he resign, brushing aside an opposition ultimatum to step down or face impeachment over allegations he received bribes from Brazilian contractor Odebrecht.

"I am not going to abdicate my honor, my values or my responsibilities as president," Kuczynski said in a televised speech to the nation, backed by his ministers.

"I won't run, I won't hide nor do I have any reason to do so," he said, promising to cooperate with investigations by Congress and the country's attorney general's office.

The right-wing Popular Force party, which controls the Congress, had warned it would begin impeachment proceedings against him if he did not resign by Thursday.

Odebrecht, a Brazilian engineering and construction giant at the centre of multiple corruption cases throughout Latin America, revealed on Wednesday it had paid Kuczynski five million dollars in consulting fees between 2004 and 2013.

For part of that period, Kuczynski was economy minister and head of cabinet for then-president Alejandro Toledo, whom Odebrecht said it paid $20 million in kickbacks to win a contract managing a freeway.

Following an investigation by US authorities, Odebrecht agreed a year ago to pay a record $3.5 billion fine after admitting to paying $788 million in bribes across 12 countries to secure public works contracts.

Fictitious "advisory fees" were one scheme the Brazilian company used to funnel bribes to officials.

"It's obvious that him staying on in the nation's highest office is untenable," Popular Force spokesman Daniel Salaverry said, referring to Kuczynski, a centrist who took office last year after being elected to a five-year term.

But in his speech, Kuczynski said he would not step down because "it cost us a lot to recover democracy, and we are not going to lose it."

"Regional crisis" 

The Odebrecht scandal has ensnared politicians in several other countries, including Mexico, Panama, Venezuela, and of course in Brazil itself.

It has generated "a regional crisis that shows that corruption is structural in all those countries," the former head of the anti-corruption watchdog Transparency International, Jose Ugaz, said.

On Wednesday, Ecuador's vice president, Jorge Glas, was sentenced to six years in prison for taking what prosecutors said was $13.5 million in bribes from Odebrecht. 

He is expected to appeal the conviction and sentence.

Glas so far is the biggest political scalp from the Odebrecht affair. But Kuczynski risks outranking him if Peru's opposition gets its way.

Kuczynski denies receiving money

Kuczynski, a 79-year-old former Wall Street banker, had denied that he received any money from Odebrecht. But on Saturday, he admitted he had provided advisory services, but did not give details. He denies receiving any illegal payments.

The president has said he will testify before a congressional commission looking into the extent of Odebrecht wrongdoing in Peru on December 22.

In the event he does step down, Peru's First Vice President Martin Vizcarra - currently ambassador to Canada - would replace him.

The crisis is benefiting the Popular Force party, which holds 71 of the 130 seats in Congress.

It is led by Keiko Fujimori, daughter of disgraced former president Alberto Fujimori, in prison for murder, kidnapping and other human rights abuses as well as corruption during his 1990-2000 reign.

Keiko Fujimori was narrowly beaten by Kuczynski in the 2016 presidential election.

The political crisis was blowing up a month before a visit to Peru by Pope Francis.