PERU:Washington Post

Peru Economy Grows, But Problems Abound
Scandal, Protests, Guerrillas Plague President


Alan García can only improve over his first term.
Alan García can only improve over his first term. "He was the worst president that Peru's ever had," an observer says. (By Edgar Romero -- Associated Press)


By Joshua Partlow
Washington Post Foreign Service
Sunday, November 16, 2008; Page A16

LIMA, Peru, Nov. 15 -- These should be good times for president Alan García.

His country posted 9.9 percent economic growth in September at a time when world economies were crashing. He nailed down a free-trade agreement with the United States and is negotiating similar accords with China, Japan, Singapore, Canada and the European Union. The wealthy are eating seviche in beachfront restaurants of the capital while luxury high-rise apartments keep going up around them.

"Anything could happen in 2009 and 2010," García told investors at a business conference last month. "Except a recession in Peru."

And yet, times are tough for García. He purged his cabinet amid an ongoing scandal over whether officials in his government received bribes in return for oil exploration concessions. He has declared a state of emergency in four provinces to quell violent social protests over distribution of mining revenue. The Shining Path, which terrorized the country in García's first term from 1985 to 1990, recently launched a series of attacks. And his approval ratings had sunk to 22 percent in October, the lowest level since he took power a second time in July 2006.

García knows quite a bit about bad times. During his first term, things could not have gone much worse. He took power at age 36, a young leftist populist whose thrilling orations from the palace balcony captivated the crowds. His approval ratings hit 90 percent -- before they came crashing down. Seven-digit inflation, a bloody battle against the Shining Path, soaring poverty and corruption scandals left him widely reviled.

"He was the worst president that Peru's ever had," said Jo-Marie Burt, a professor of political science at George Mason University who studies Peru. "This is his chance to reclaim his place as a good president."

He is also trying to be a much different president. García still wears a sash and carries a miter, has the same shock of black hair and heavyset frame, but he has transformed himself. No longer the firebrand leftist who stiffed the International Monetary Fund, cut the military budget and tried to nationalize the banks, García returned to power somewhat chastened, preaching "responsible change" rather than revolution, and with a new conservative faith in markets. This transformation has made him popular with the business community in Peru and abroad, but his critics see it as another example of how out of touch he is with his people and the region, as left-wing movements have taken hold in Venezuela, Bolivia, Ecuador and elsewhere.

"Now, when the world is changing, changing the relationship between the state and the market, looking for new alternatives, García is clinging to the past," said Ollanta Humala, a leftist politician who lost to García in 2006. "We have had two years of abundance and growth, which has not been reflected in development, particularly for the majority, who continue in conditions of economic subsistence."

Many of the recent social protests have revolved around the growing perception that poorer Peruvians are not being helped by the big mines and dams that García has championed. In the southern region of Tacna this month, protests broke out over changes to the law that returns tax revenue paid by mining companies to the regions where they operate. Mobs looted and burned government buildings, two protesters were killed by police, and the government declared a 30-day state of emergency. The number of social conflicts tracked by the national ombudsman's office reached 189 last month, more than twice the level of the previous October.

"The mineral bonanza in this country has been accompanied by significant conflict between large firms and the communities," said Cynthia A. Sanborn, a political scientist at the Universidad del Pacifico in Lima. "The boom brings with it a lot of conflict, it doesn't generate enough employment and it doesn't reduce poverty."

A scandal known as Petrogate has also politically damaged García, whose first administration was dogged by corruption. Audiotapes made public last month cited the ruling American Popular Revolutionary Alliance party in allegedly taking kickbacks for granting five concessions to Discover Petroleum, a Norwegian oil company. The cabinet resigned en masse and García eventually replaced six of the 17 members, including the prime minister. The new prime minister, Yehude Simon, was accused of terrorism and jailed for eight years during President Alberto Fujimori's administration in the 1990s before being pardoned. He is considered to have more liberal views than García.

"It's a very audacious selection by Alan García. Some people might call it an effort to co-opt the left," Burt said.

In Peru, a Rebellion Reborn
Dreaded Shining Path Returns as a Drug-Financed Movement Seeking Popular Support



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By Joshua Partlow
Washington Post Foreign Service
Wednesday, November 12, 2008; Page A12

PUKATORO, Peru -- After years in relative obscurity, the Shining Path, one of Latin America's most notorious guerrilla groups, is fighting the Peruvian military with renewed vigor, feeding on the profits of the cocaine trade and trying to win support from the Andean villagers it once terrorized, according to residents and Peruvian officials.
This Story

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In Peru, a Rebellion Reborn
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The Shining Path's reemergence has stirred chilling memories of its blood-soaked forays of decades past. In October, Shining Path guerrillas killed more people -- 17 soldiers and five civilians -- than they have in any month since the 1990s. This rising death toll is largely attributed to a fresh offensive by the Peruvian military, launched under the same president who battled them in the 1980s, to try to destroy the remnants of the once almost forgotten communist rebel group.

But those who live among them, as well as those who study the secretive group, also describe other reasons for their resurgence. The Shining Path, which has its bases in two coca-producing regions of central Peru, is now heavily involved in drug trafficking and is paying for new recruits.

Experts said the guerrillas have renounced the brutal tactics espoused by their original leader, Abimael Guzmán, who was captured in 1992. Unlike Guzmán, who said 10 percent of the Peruvian population had to be assassinated for the Shining Path to take power, the new leaders tell their followers they must protect the villagers and instead target the military and anti-drug authorities.

In numbers, the guerrillas' ranks remain a fraction of their former size: 400 to 700 full-time fighters in the branch that insists on armed struggle, according to various estimates; in the low thousands if offshoots that call for more-peaceful political revolution are included. In ideology, they appear to have abandoned the strict Maoism that Guzmán preached and to have adopted a muddled form of communism that welcomes foreign investment and large international mining companies, among others, provided they treat their workers well.

Before dawn on Oct. 20, a column of Shining Path fighters walked single-file out of a cold mist into an American-owned mining camp in Pukatoro, in the Ayacucho region of southern Peru. They wore all black, with bulletproof vests, and carried assault rifles. The guards at the camp, who were unarmed, surrendered their radios and joined the miners on a patchy grass plateau to listen to the guerrillas.

"We are not going to hurt you," one of the guerrillas said, according to an account confirmed by five workers present at the encounter. Instead, the guerrillas told the workers that the mine's owner, St. Louis-based Doe Run, should be paying health benefits and higher salaries. Before leaving with supplies of canned tuna, rice, sugar and gasoline, the guerrillas wanted the miners to know that "they were not going to commit the same acts of violence like they did in the past," one witness said.

The road to Pukatoro is a single-lane dirt path that ascends in precipitous switchbacks through fields of prickly pear cactus up the Andes' mist-shrouded slopes. The Shining Path revealed its brand of brutality to the world in 1980 by stringing dead dogs from lampposts in the coastal capital, Lima, but it was here among the impoverished Quechua-speaking indigenous people of Ayacucho that the Maoist movement started and gained strength.

Guzmán, a philosopher and university professor who remains imprisoned, aspired to emulate the rural uprising Mao Zedong led in China, and he was prepared to cross a "river of blood" to do so. Peru's Truth and Reconciliation Commission estimated in 2003 that 69,000 people died from 1980 to 2000 during fighting between the Shining Path and the military -- a legacy still emerging from mass graves throughout the countryside. More than half those deaths have been attributed to the guerrillas.

"The ghosts are waking up once again," said Gustavo Gorriti, an author and expert on the Shining Path.

After the Shining Path visit to Pukatoro, the copper prospectors in this small mining camp nearly 14,000 feet above sea level packed up and departed, temporarily shutting down the operation, according to the guards who remain at the site protecting machinery. A spokesman for the company declined to comment about the situation.

"The Shining Path is not finished," said one of the guards, who refused to give his name. "They are still killing people."
In August, the Peruvian military launched an offensive known as Operation Excellence to target the group's jungle stronghold in the Vizcatan area of the Apurimac-Ene River Valley, down the eastern slope from Pukatoro. In addition to the 17 soldiers killed last month, 35 others have been wounded in the fighting, said navy Capt. Juan Carlos Llosa, a spokesman for Peru's Joint Chiefs of Staff.