The Future of Peru, by Ángel Carlos Cerrato Covaleda

(Axis of Logic, (White Rose Reader), 2 April 2013,



Where Is Peru Heading?

On December 3, 2011 Venezuela created CELAC, Spanish for ‘The Community of Latin American and Caribbean States.’ CELAC is designed to challenge North American hegemony. It’s composed of 33 countries south of Rio Grande, and is the result of several decades of struggle in this region to find its own voice in the world and exert its own influence. In this regard, despite all its contradictions, CELACS’ goals are similar to those of other such institutions in the region—Petrocaribe, the Bank of the South, the MERCOSUR, the ALBA or the UNASUR, but broader in scope—so the expectations are high.


Ollanta Moisés Humala Tasso won the 2011 presidential election defeating Keiko Fujimori. He campaigned as a center-left leader on a platform of nationalizing Peru’s national resource industries and a more equitable distribution of Peru’s wealth. After being elected he began supporting extractive capitalism and oppressing the Peruvian indigenous protests. *

One of the only three absent dignitaries at the conference of CELAC was Ollanta Humala, the current president of Peru. His attention was instead focused on a problem in Cajamarca, one of the regions in the north of the country. There a gold mining project called Conga, which is owned by US and Peruvian company (and whose worth is estimated at $4.8 billion) has provoked strong opposition from the Cajamarca population, environmental defense organizations and the regional and local governments. For months the opposition has backed an indefinite strike, protest demonstrations, rallies and the shutting down of services. Yet the president keeps saying the project is legal and has accused the protest leaders and the regional government of being intransigent and unwilling to debate; however, his dialog has consisted first of declaring a 60-day state of emergency, suspending constitutional rights, and giving the security forces extra rights to perform at will, arresting the leaders and freezing the federal funding for that region. Through all this Cajamarcans have maintained opposition to the mining because the population knows it will mean environmental destruction to their region. Cajamarca is not the only place where these issues are occuring in Peru. Quiruvilca and Ayavacaare two other recent examples.But it seems Ollanta doesn’t want to shut down one of the biggest income resources for this country: Peru is, after all, the 5th largest gold exporter in the world. After fruitless negotiations in Cajamarca as well as in Lima, the Cajamarca regional government passed a bill protecting their region. This created an issue over jurisdiction—Lima claims that only the national government is authorized to pass such a bill, but the national law says regional governments are allowed to do so, as long as the laws are consistent with the national policies.

This conflict between the population of these regions, their respective governments, and the central government in Lima highlights the clash between two models of resource exploitation and economic growth. Whoever wins these battles will establish how foreign multinationals invest in Peru, and how to handle the environment and the future of social issues in the country.

Tensions created by the Cajamarca crisis and the delay in devising solutions led Ollanta to make a cabinet change. He got rid of his original cabinet (called the “rainbow cabinet” because it represented a diversity of views) and replaced it with a group of ministers coming from the military, which is where Ollanta himself came from. This new group of hardliners is politically conservative, economically in favor of big mining business and has a strong military mentality. This causes many to believe the central government will impose the Conga project by means of repression, carrying on Fujimori’s authoritarian policies.

How then is Ollanta going to meet the demands of the electorate who brought him into office? This is an electorate that comes mainly from outside Lima, (especially from the South of the country), and composed of rural, middle or lower-middle class, and left-winged people who are experienced in social movement struggles. Opinion polls on Ollanta’s preformance have fallen dramatically, and many of the social forces, like the Confederación General de Trabajadores del Perú (CGTP), (the biggest union in the country), have reversed the focus of their street marches from supporting him to now attacking him.

The various social force keep taking the streets and the “plazas mayores”—town squares— of many cities to protest not only thier disapproval of the Conga Mining Project, but also the many other unresolved problems in the country. Peru has historically suffered. The people are demanding taxes on big mining businesses, mandatory prior consultation on mining projects in their regions, ecological zonification of national territory, and a moratoriumon GMOs (genetically modified organisms) in the country.

The environmental issue is not petty, as Peru is among the 20 countries most impacted by the climate change: its biodiversity is rapidly shrinking, its jungle is turning into prairie, 20% of its glaciers have melted in the last thirty years and lakes like Titicaca are experiencing extremely low water levels.

There are also protests, though to a lesser degree, focused on the constant problems that no government has ever tackled. These are things like: a more equitable distribution of the country’s wealth, the way the government handles crime, political corruption, power abuse, and the opposition of the creation of new American military bases in Peru. The crescendoing social unrest has already become one of the big issues affecting this government.

But considering the broader picture, let’s not forget a past that still haunts the country: the 20 years of Sendero Luminoso (Shining Path: a Maoist guerilla insurgency) and its clashes with the Peruvian state. On December 7, 2011 the newspaper El Comerciopublished an interview with “Artemio”, its current leader, where he states he is not going to demobilize his army as long as there is not a true negotiation process. Ollanta’s response was that ‘the state doesn’t negotiate with terrorists.’

Historically, both terrorism and counterterrorism have resorted to drug trafficking, which is yet another lingering problem. Peru is not only one of the biggest coca leaf producers in the world, but it also sees within its borders the beginning of the whole manufacturing process, with processing labs and smuggling routes. The Peruvian jungle, which makes up to a third of the country, is witness to this situation: it has an entire world of mafia-operated territories, trading routes and turf wars. The jungle is where the presence of the state is the weakest, as the newspaper La República reveals in its December 18, 2011 issue.

While all this was going on, the Inter-American Commission on Human Rights (IACHR) brought a lawsuit against the Peruvian state for the Chavín de Huántar commando unit’s executions of three captured guerrillas that raided the Japanese ambassador’s residence in Lima in 1997, while Alberto Fujimory was president. To make matters worse, Keiko Fujimori, the ex-president’s daughter, having lost the last elections, has asked for a state pardon for her father—who is serving prison sentences for crimes against humanity and corruption.

Amidst these countless problems, a positive macroeconomic reality has made its way through. Its economy is growing at an annual rate of 4.7 % (bear in mind that when Spain proudly boasted of being the 9th largest economy in the world, it grew at an annual rate of 3.8%). Its exports grow at a rate of 20%. The Economic Commission for Latin America and the Caribbean predicts an estimated growth of 5% for 2012, making it the 3rd fastest growing economy in Latin America. Access to domestic credit is easier than ever and the society, with a middle class that has been toiling to survive for at least four decades now, is enjoying a spending spree, especially on technology, family cars and real state. The construction business is booming, and prices are skyrocketing at property bubble speed (people in Spain know what I’m talking about).

Lima, with 8 million inhabitants (a third of Peru’s total), illustrates this trend. The city launched its infrastructure projects in December 2011 in New York to attract financing after the funding agencies gave them a rating of BBB. The projects consist of real estate development, historic urban renewal, construction of public spaces, and shopping and tourist areas. The city also opened the Metropolitan Museum on December 2011, and, the first electric railway line on January 2012. The newly open Metropolitan Bus service has two corridors for the exclusive use of bus, to which four others will soon be added. Its international port, El Callao, is the largest container ship port on the west coast of South America.

Meanwhile, malls are multiplying. The family car fleet is being renewed quickly and presumptuously. In the midst of humble, unpainted iron-and-brick apartment blocks, gleaming glass financial buildings are born. Billboards are everywhere. People use the latest cellular phones. Commercials invade television programs. Not coincidentally, National Geographic magazine website recommended Peru as one of the best destinations worldwide for 2012, along with just three other countries, mentioning the time of economic prosperity, its status as the gastronomic capital of Latin America, and its increasing quality of tourism, cultural as well as environmental.

But after a decade of neoliberal growth at an annual average of over 6%, poverty has barely fallen from 31% to 28% (that is, nearly one in three Peruvians are still poor). Amid a growing economy with an unprecedented increase in domestic credit expansion, in the construction business, and in the exploitation of mineral resources, the state institutions are undernourished or non- existent. It is true that some measures have been taken by the president. In an effort to bring decentralization, for example, Ollanta has begun to bring the state to the population. State institutions such as the anti-corruption prosecutor office have branched out to other provinces of the country for the first time ever. And it is also true that Humala has initiated a series of social programs, such as the Programa Nacional de Apoyo Directo a los más Pobres (National Program of Direct Support to the Poorest), a program designed to make 65 the retirement age and give scholarships to 18-year-old students.

But the country is still far from reforming the four pillars of what we call the welfare state in Europe: health, education, communications and the public administration—reforms that various social forces are already demanding.

I. Healthcare:

The country doesn’t have free healthcare that’s both accessible and without crowds or waiting lists. That’s why the average Peruvian makes use of private medicine whenever possible, despite the burden of the higher costs. But even without waiting lists, the private medicine often lacks the professionalism and infrastructure provisions that are common with medicine in Europe. In many places, both in Lima and the provinces, the healthcare system is non-existent (the state does not reach out, and the private enterprise doesn’t find it profitable), so it is only offered by missionary communities in return for brainwashing.

II. Education:

There is still no universal and free public education. Quality goes hand in hand with cost, and private education (religious or not), ends up being the only alternative to an aspiring middle class that performs two or three jobs to ensure education for their children. Public education is neglected by the state, with ridiculous access examinations for teachers, who can look forward miserable salaries (many practicing teachers are forced to get additional jobs to make ends meet). The results are: poorly trained teachers, with poor facilities, outdated textbooks lacking in academic rigor, and a lack of equal access to education for students. This makes a disjointed country socially and psychologically. As Federico Kauffman, the renowned Peruvian-German archaeologist and historian puts it,

“While German educational uniformity has decisively helped to instil respect among South and North Germans towards each other, in Peru the racial and geographic origin is a source of racism, disregard, marginalization, misunderstanding and confrontation, partly because of the absence of a universal education that creates a national identity.”

Consequently, a large part of the population lives in a permanent sense of inferiority about not being White and not living in the capital.

III. Transportation:

Peru has such a poor transportaton system that, in certain parts of the country, the state’s presence barely exists. Road maps show a network with two basic colors: paved roads and unpaved roads. This network has many unconnected sections. Leaving Lima and getting to any nearby city (Ica, for instance) takes up to three times longer than the same journey would take anywhere in Europe. There are only a few kilometers of railway. In a country that is more than twice the size of Spain, the state has left to private enterprise the expansion of air travel. Peru airlines such as Voy Peru now provide passenger transportation that is not regularly accessible and subject to the dictates of the airline. Auto traffic in the capital is sheer chaos: the rules either do not exist, or are not known, or not respected, or all three at once. The danger this poses to the population—in their vehicle or on foot—is an everyday reality. Transportation is managed mostly by private companies that the state neither regulates nor monitors. For this reason, the user cannot seek redress for poor service, as each company is self-regulating in this area, and the alternative is to use another self-regulating bus company. And forget about contacting or complaining online.

IV. Public Administration:

The average Peruvian faces daily a slow, inefficient, bureaucratized and highly corrupt government (national, regional and local). And yes, here too, forget about contacting or complaining online. This is largely the result of the never-ending partisan exploitation each government has made of the public institutions. Public officials’ low salaries generate a clear desire to work as little as possible, and ostensible attitudes of disrespect or disregard towards the people who use the service; that is, unless you opt for “speeding up” the procedures with coimas (bribes). As shown in a study conducted by the University of the Pacific in conjunction with the Consorcio para el Estudio Económico y Social, (Corrupción e inequidad en los servicions públicos en el Perú, Lima, 2011), it is no coincidence that the institutions responsible for ensuring compliance with the law—the police and the judiciary—show the highest rates of both bribes accepted and citizens who never complete their paperwork. Peruvians spend more than 5% of their income in bribes, but this is only an average between those who spend the most (the poor) and those who spend the least (the rich); after all, it is the poor who are less likely to successfully complete a bribe. Corruption is also the reason why many people cannot access certain services, even when they are available. Only four out of ten Peruvians have running water in their homes, although seven in ten have access to it. This is because a corrupt bureaucracy stands in their way demanding bribes that many cannot afford to pay. And here, too, forget about contacting or complaining online. Public institutions not only prey on citizens, but on the state itself: Peru loses 15% of its budget for purchases and investments in the labyrinths of administrative corruption (although this figure is not large compared to the cost of corruption in Latin America as a region, with nearly 50%).

The anger of the base is increasing, as the fear of the elites evaporates. The government of Ollanta Humala reasserts itself in a neoliberal economy and on a (mostly foreign) predatory industry, as in colonial times, when the raw material was taken away to be manufactured in the metropolis (formerly Spain, now the USA / Canada). Apart from talking about the importance of social inclusion, Ollanta has not announced any initiative on public safety, education or health. He hasn’t announced a budget. Endemic poverty is not eradicated with timid welfare programs. And a culture of corruption does not disappear with weak attempts to make things right. The rhetoric of “big change” (his motto) has now fallen flat.

But even if Peru introduced a state capitalism system with a welfare state, it still wouldn’t compare with the dynamic Latin American countries where social pressure has brought about governments that, at least partially, have broken off with neoliberalism, have opposed U.S. domination, have launched serious political reforms, and have restored public control over natural resources in various degrees. Venezuela is the prime example of this dynamism, for it is immersed in the next phase: the gradual abandonment of capitalism and the experimentation with different forms of a mixed or tending-toward-socialist economy.

For Peru to move towards what Venezuela has accomplished, its people will need to organize themselves into powerful forces and continue to fight for their rights. The movements in Peru may have yet to accomplish what has been accomplished in other countries, but they are part of the growing social movements that restlessly struggle across Latin America. And it’s these movements that have cast a ray of hope that flickers in the sky for the rest of us who, submerged in a crumbling Western world, dream of a better future for humankind.

(caption below Humala’s photo by Axis of Logic)

Source: White Rose Reader

This entry was posted in Uncategorized and tagged . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s