”Analyse av den aktuelle politiske og sosio-økonomiske situasjonen i Latin Amerika”

Peru

The current situation in Peru is marked by the current presidential and congressional elections. At the moment of writing, it is most likely that former President Alan García will be meeting nationalist candidate Ollanta Humala at the second round of elections, the first week of June at the latest. The first round elections last April had a high participation rate, with 88% of registered voters exercising their right to vote.

Actors

The element of surprise that characterizes the current electoral context has much to do with the administration of current President Alejandro Toledo. This president will be remembered in Peruvian history as a prime example of the volatility of political popularity. The leader of a broad political front known as “Movimiento de los 4 Suyos” (in reference to the four regions of the Inca Empire), who managed to gather support against former President Fujimori and mobilized thousands across the country in the 2000 elections, is now a lonely figure with less than a 7% approval rate. Even worst, his political coalition Peru Posible and Frente Independiente Moralizador have hardly managed to get a seat in congress after the recent election, thus being erased from the political scene for the time being. The regime’s popularity has fallen gradually as a result of several corruption scandals involving the president’s family, and privatization plans which were met with strong opposition by trade unions.

Today’s most notorious political figure is former military officer Ollanta Humala, leader of the Partido Nacionalista Peruano (PNP). Humala jumped into the political scene when he led a military rebellion against Fujimori in 2000, shortly before the regime came to an end. Together with his brother Antauro, also in the military, they endorsed a doctrine called “Ethno-Cacerista” developed earlier by their own father. Ethno-cacerismo is based on nationalist ideology and inspired by former President Juan Velasco and Pacific War hero Andrés A. Cáceres. Until 2004, the Humala brothers and the ethno-cacerista “movement” were considered the controversial and colourful element in the Peruvian political scene. They adopted a mixture of Andean and fascist symbolism, and an authoritarian rhetoric calling for the need of revolution and change. They also organized a supporter organization known as reservistas, who wear army-like uniforms and endorse military-like discipline and structure. The failed “uprising” of Antauro Humala and a group of his reservistas in Andahuaylas in January 2004, leaving six policemen dead, changed the initial impression of the ethno-cacerista movement as harmless. Ollanta, the formal head of the party, both condemned and distanced himself from the events in Andahuaylas. This would initiate a process of division within the ethno-cacerista movement, which took a more concrete form with the creation of the Partido Nacionalista Peruano by Ollanta Humala and his wife in April 2005. In December the same year, Ollanta forms an electoral alliance with Unión por el Perú (UPP), with him as presidential candidate. The alliance of UPP-PNP turns out beneficial for both parties, as UPP provides a national party structure with congressional experience (3 elected congressmen in the current period), while PNP provides the charismatic leader UPP does not have.
According to media sources in Peru, Humala is supported by the poorer sectors of the population, particularly in southern Andes region and in rural areas. His party has managed to place in congress three female representatives closely connected to coca-producing peasant organizations. PNP supporters have also been observed attending all sorts of peasant community meetings in the countryside. It is worth noting that the ethnic rhetoric of his ethno-cacerista base has been toned down in PNP. Nonetheless, it is the only party that has translated its entire government plan to Quechua – and posted it on internet.
After a disastrous administration in the period 1985-90, APRA (Acción Popular Revolucionaria Popular), lost popular support across the country, becoming but a shadow of more glorious times. Yet the resilience of a core constituency, particularly in the northern coastal regions, together with a strong party organization, have contributed to the fact that APRA is the only party of the “old generation” to survive the crisis of political representation in Peru. While traditional parties have seen their constituencies be reduced to insignificance, APRA reached 22% of given votes in 2001, and 20% this year. For many Peruvians, support APRA is likened to the refusal of history; yet for 1/5 of the population, it still offers a viable political alternative.
Alan García is referred to as a “populist” leader, in the negative sense of using populist tactics to gain support. To their defence, apristas argue that APRA today is not the same party as it was 20 years ago. They argue that lessons have been learned, not only from their own failures, but also from what happened since they left the government. As in its formative period, APRA supporters constitute a broad front of workers, peasants, civil servants, miners, small and medium entrepreneurs and traders. Increasing numbers of young people and the middle class have turned to APRA in recent years. In this sense, APRA represents a variety of interest groups, and their main political message is the need for concerted action, “concertación”, among different sectors of society.
Peru is yet to see a female president in the near future. Unidad Nacional (UN), led by Lourdes Flores, lost the electoral race by less than 1% of the vote. UN aimed to appeal to all sectors of the population, yet their supporters came mainly from the upper and middle-classes. Flores’ detractors called her “the representative of the rich”, for her support to a liberal market economy. UN will play an important role in congress however, as they count with 20 out of 120 congressional seats.
There are numerous trade unions, popular and interest organizations in Peru; but broad political fronts are rare and often short-lived. Trade unions were weakened by neo-liberal policies of the Fujimori regime, and they are still in a process of recovery. The private sector (particularly medium and large enterprises) on the contrary, is well organized and vocal. Women’s groups and organizations are numerous, and extremely active, particularly at grassroots level. A nation-wide women’s organization active at the community level is the Club de Madres (Mother’s Clubs). Women members organize in their local communities, usually in poor areas either in the countryside or in the cities. Activities have developed from the original support to community kitchens to educational and health programs.
Given its social base and composition, the ethno-cacerista movement cannot be considered as an indigenous movement. Broad indigenous movements similar to those in Bolivia and Ecuador are non-existent in Peru, while a number of smaller groups have been formed, particular among the native populations of the Amazonian rainforest. Besides these groups, there is no tradition among the highland population to formulate economic and political demands in ethnic terms (such as “quechua” or “aymara”). Claims are usually framed in terms of rights and citizenship. Peru is a good example of the complex realities that do no fit fixed categories such as “indigenous peoples”.

Issues & Dynamics

In 2001, the main priority of the government was to secure economic stability, both for national production and international investment, after a period of political instability and transition. Toledo’s government did not differ much from his predecessor in terms of economic policy, and during his administration, Peru has indeed experienced unprecedented economic growth.

The problem resides in that the trickle-down effect of economic growth has not overcome current poverty levels, nor has it solved the problem of unemployment (or rather, under employment). The president’s main objective of reducing poverty has shown very modest results by the end of his term. Even when there has been a reduction in poverty levels since 2001, by 2004 51% were poor, and 19% lived in conditions of extreme poverty. The benefits of economic growth are already noticeable among the urban middle classes, also the most vocal sector of the population. Yet poverty in the peri-urban and rural areas persists, affecting also indigenous population, often the poorest of the poor.
The decentralization process in Peru implemented in the last four years has been a serious attempt to meet the challenge of regional inequalities through mechanisms of local representation and political participation. Results have been mixed, yet the process is now well established in the institutional framework. Local mechanisms of popular participation such as “Planificación Concertada”, “Presupuesto Participativo”, and “Mesas de Concertación de Lucha contra la Pobreza” are now common across the country. Their impact however, might be limited, particularly if the demands aired it such fora do not lead to concrete results.
One of Toledo’s major (if few) political achievements has been the signing of a multi-party, multi-sectoral agreement known as “Acuerdo Nacional” (AN; National Agreement) in July 2002, which established 31 state policies concerted and agreed upon by the government, political parties, private sector and civil society representatives. The objective of this initiative was to agree upon a common vision for Peru in the long-term. Its endorsement by political actors of different orientations would provide a common and stable base for the development of Peru’s future political, social and economic development. Furthermore, it has established a channel for multi-sectoral dialogue and participation, which also monitors progress made by the government to reach the objectives of national policy. In the current electoral context, the Acuerdo Nacional has served as a framework for debate, and its objectives are shared across the party spectrum. For international observers, the AN provides a minimum of stability and continuity in Peruvian national policies.
In spite of other appearances, the democratic practice has taken root in Peru. We are witnessing the use of electoral mechanisms to express popular dissatisfaction with the current administration and the political party system. It was only 25 years ago that the vote to the illiterate was granted by the Constitution of 1979, most of which were the poor, indigenous, peasant population. The practice of democracy was obstructed by the armed conflict of the 1980s and 1990s. Already in the 1990s elections, dissatisfaction and the use of the ballot box to induce change could be observed; the same in 2001 with Toledo and now again, with Humala. Although this electoral race might not be an “informed choice” in the sense that the voter knows well the government plans of each candidate, her choice is based in the knowledge of what she wants and does not have. For the poor and marginalized then, Humala and to a certain extent Alan too, express alternatives for change. For the educated middle-class however, such support is the “the vote of ignorance”. Particularly if Humala is elected president, he can expect to face a fierce opposition from the middle class.
An issue that is turning divisive in Peru is the Free Trade Agreement (Tratado de Libre Comercio - TLC) with USA. Negotiations started in 2004, accompanied by Ecuador and Colombia, and concluded early this year. Approval by both the Peruvian and American Congress is still awaiting. The current administration would like to see the TLC signed before leaving office, yet the two candidates for the second presidential round have been critical of the TLC, and would rather leave that decision to the new elected Congress. In the current electoral context, the public debate on the TLC is more rhetorical than technical, and is being discussed in nationalist terms (“for or against yanquis”, “selling/betraying Peru”). Another topic that in other circumstances would not have reached the electoral agenda is “globalisation”, focusing mainly on threats rather than benefits. Although these topics are of limited import for large sectors of the population, they are also very close to home for others, such as coca-producing peasants in the Andean highlands, cotton and sugar farmers in the coast, and even small and medium-size firms.
Natural Resources

Extraction of minerals are the main natural resource based economic activity in this Andean country, and constitutes now about 6.2 % of the GDP rising from 3,5% in 1991.⁷ This increase is mainly due to investments by multinational mining companies that responded positively to company favourable conditions introduced during the Fujimori presidency, i.e. free movement of profits, and low taxation rates after subtraction of investment costs. As world market prices on minerals have risen considerably in the recent years , the contracts for the multinationals have increasingly become scrutinized and criticized at two major points.

The tax income from this sector is still minimal, being currently at the same level as the petroleum sector, even if it is 10 times larger and represents 40 % of total exports.⁸ The main reason is the extremely beneficial write-off rules for heavy investments (about 9 bill. USD since 1992) where no net tax income is paid until all investments have been recuperated, in addition, there is hardly any licence fees.⁹
In some instances there have been protests against environmental consequences of the mining activities.¹⁰ The American multi-national Newport had to apologize for a new project connected to the gigantic gold mine of Yanacocha last year. However, at the heart of the discontent is the fact that modern mining industry is extremely capital intensive employing very few people. So even if minerals constitute 55 % of exports, less than 1 % of the working force is employed. The owners counter by saying that 29 % of the public tax income is paid by the industry, while the government has unsuccessfully tried to introduce a royalty paid directly to the state as a 3 % sales tax.
Returns to the local population by mining is also considered to be small.¹¹ These local communities directly affected by the activity have been compensated for their losses by the judicial system rather than through direct negotiation with the multinationals. The regional and district authorities where mining takes place do however receive a fixed share of the resource tax income which originates there. However, as the total tax income is small, so is the share distributed to the districts. This is, however, increasing sharply as the tax haven disappears, i.e. from 6 to 30 mill USD in the two last years.
Natural gas has lately become a new and increasingly important natural resource in Peru. What is known as the Camisea Project is the exploitation of the San Martin and Cashiriari fields, jointly known as Block-88 (and in the future the adjacent block 55 ) in the jungle close to Cuzco.¹² The building of two pipelines to Lima/Callao has been completed¹³ and the distribution system to both industry and consumers in Lima is already operating. A LNG project with total cost of USD 2.2 billion for exports to USA and Mexico is being developed.¹⁴ Other mayor gas deposits are not known. Critical voices have been raised by local populations and environmental groups concerning the effect of gas production sites and pipelines upon the natural environment and people’s livelihoods, particularly in the rainforests in Camisea, and the national reserve of Paracas.
Oil exploitation is a negligible industry in Peru, yet the country is number two in world fisheries.¹⁵ Even though a large share is caught by industrial (and often foreign) trawlers, the amount collected in taxes is rather small. The exploitation of natural resources hence constitute an important part of the Peruvian economy, but there is still potential for the government to capture a larger share of the resource rent available for the good of the people.
Trends

The current situation is a scenario feared by many Peruvians, who see the choice between Humala and García as a choice between two evils. It will therefore be very difficult to attract voters from other parties. In congress, the absence of a clear majority means that the executive branch will face limits in policy implementation. Although UPP has almost as many seats as APRA, none have a clear majority, and will have to depend on alliances with other parties.

The main challenge facing the new government will be how to sustain Peru’s rapid economic growth while reducing poverty. The relevance and institutionalization of the Acuerdo Nacional will be put to a test with a new government. APRA has publicly endorsed its support to the AC prior and during the campaign, and it is likely to implement it. A different scenario could be expected if UPP-PNC win the election, since of the two parties, only UPP signed the agreement, as PNP did not exist at the time.

It is most likely that the approval of the TLC with USA will be put on hold by the new government. Furthermore, even in the event of signing the TLC, it is most likely that South American integration fora are to be pursued. In the case of candidate Humala, the leadership of Venezuela is likely to be supported. When it comes to APRA, Brazil’s leadership and the CAN seem to be the most preferable options.

Postscript. After a very intense electoral campaign, APRA’s candidate and former president Alan García won the second round for presidential elections on June 9 2006, with 52,2% of the votes. The Nationalist candidate obtained 47,3 % of the electoral support. Voter participation was 88%. The results have been welcomed and accepted by contesting political parties. Apra has already announced its support for economic stability. As elected president, he has already visited President Lula in Brazil, to discuss anti-poverty strategies. Under the current context, a smooth transition to the new administration can be expected