Guatemala president shakes up cabinet as corruption scandals bite

By Sofia Menchu GUATEMALA CITY (Reuters) - Guatemala's President Otto Perez announced a major cabinet reshuffle on Thursday, firing several ministers after corruption scandals battered his government, fuelling calls for him to step down. Perez told a news conference he had dismissed the interior, energy and environment ministers as well as the country's intelligence chief and other senior officials following a string of arrests and recent mass protests in Guatemala City. The retired army general, who has not himself been accused of corruption, said the government would work with investigators to root out abuses by public officials. "There is an openness to investigate in any place, in any ministry," Perez told reporters. Echoing steps by Chilean President Michelle Bachelet earlier in May, Perez said he had told his ministers two weeks ago he was considering a complete reshuffle of the cabinet. The corruption scandals have buffeted Perez's conservative Patriot Party ahead of presidential elections in September. A senior government official in Guatemala, speaking on condition of anonymity, said Perez had asked all the cabinet ministers linked to allegations of corruption to step down so the president could finish his four-year term as planned. Still, Andres Toledo, a 31-year-old businessman in Guatemala City, said it would not be an easy few months for Perez. "These steps come very late and just try to gloss over a more serious problem that's been there since the start of the government," he said. "They aren't going to have the desired result, the people's clamour won't be silenced." The departing Interior Minister, Mauricio Lopez Bonilla, was seen as a particularly close ally of the president. Lopez Bonilla has been accused by local media of conflicts of interest in the awarding of government contracts, though Perez defended him and dismissed the reports as "rumours." On Wednesday, Guatemala's central bank chief Julio Suarez and 14 other people were arrested, accused of rigging a multi-million dollar contract from the country's Social Security Institute in favour of a pharmaceutical firm. The head of the social security institute and former private secretary to Perez, Juan de Dios Rodriguez, is also now under arrest, the attorney general's office said. Rodriguez was in hospital on Wednesday when the arrests took place. Two weeks ago, Vice President Roxana Baldetti stepped down after accusations that she had been linked to a ring accused of taking bribes to avoid customs taxes, but protests in the nation of 15 million people have continued since then. The silver-haired Perez has repeatedly said he will serve out his term. Guatemalan law dictates that he cannot seek re-election. (Additional reporting by Anahi Rama and Gabriel Stargardter and Dave Graham; Editing by Dan Grebler, Richard Chang and Bernard Orr)