How a Contractor's Sins Can Redeem Latin America

If the ethically challenged Brazilian contractor Odebrecht SA was counting on a sympathetic ear in its hour of need, Pedro Pablo Kuczynski should have been its man. Before becoming Peru's president last year, the 78-year-old economist shuttled between Wall Street and the policy dens of Washington and Lima, where he backed the sorts of development projects that made Odebrecht a corporate powerhouse. And yet Kuczynski recently asked Odebrecht to pack up after fining the company for paying $29 million in bribes; he also rescinded its contract for part of a $7.3 billion Peruvian natural gas pipeline.

Peru's reaction is just part of a hemispheric blowback against Brazil's suppurating graft and payola scandal, which has spread from Sao Paulo to Santo Domingo. Colombian authorities arrested a former national senator on charges of illicit enrichment and a former deputy minister of transportation for allegedly expediting Odebrecht contracts; Panama has barred the company from further public works; in the Dominican Republic, protesters have taken to the streets about the $92 million in bribes Odebrecht allegedly paid in return for official favors.