TRADE: WTO Praises Peruvian Government’s Free-Market Policies

By Gustavo Capdevila Reprint | | Print |

Gustavo Capdevila

GENEVA, Jun 1 2000 (IPS) - The World Trade Organisation (WTO) praised the liberalisation of trade and investment undertaken by the Peruvian government of Alberto Fujimori, but urged it to pay more attention to improving living standards.

Although the WTO Trade Policy Review Body hailed the performance of the Peruvian economy, which grew at an average of 5.6 percent annually in the past seven years, it stressed that “despite this rather impressive growth, per capita income is back to the level where it stood in the 1960s.”

According to the representatives of the European Union, “the impact of economic performance on poverty alleviation was inadecuate.”

But Alfredo Ferrero, Peru’s deputy minister of industry, tourism, integration and international trade negotiations, said poverty was a complex problem, and reducing it must be a gradual process, that would take longer than five or ten years of economic reforms.

He added that although the government’s economic reforms had failed to eliminate the problem, the government had driven down the poverty rate.

Ferrero pointed out that many industrialised nations had also failed to eliminate poverty.

In this week’s Trade Policy Review Body meeting, the Canadian delegation did not avoid political issues, and censured the South American country’s electoral process, which ended in a widely- questioned runoff last Sunday in which Fujimori was reelected to a third consecutive term.

Canada expressed its concern that “in spite of serious irregularities in the electoral process and the withdrawal of the monitoring mission of the Organisation of American States (OAS), authorities in Peru proceeded with the second round of voting on Sunday under conditions that lacked transparency and credibility.

“The electoral process fell short of the standards expected by Canada and the international community,” the delegation added.

Canada also voiced concern over the Peruvian government’s decision last year to withdraw from the “binding jurisdiction of the Inter-American Court of Human Rights, a decision which sent negative signals to foreign investors.”

On the other hand, the delegations of Colombia, Cuba and Venezuela maintained that the Trade Policy Review Body meeting was not the appropriate place to discuss political questions.

US delegate Rita Hayes, meanwhile, cited the problem of child labour in Peru’s gold mines, and urged the Fujimori administration to adopt specific policies against the practice.

One of the world’s leading trade unions, the International Confederation of Free Trade Unions (ICFTU), denounced this week that some two million minors work in Peru, “including at least 500,000 children under 14 who are working instead of attending school.

“Eight per cent of Peru’s workforce is aged between six and fourteen,” stated the statement released by ICFTU headquarters in Brussels this week. “Most of the children work in agriculture, followed by hazardous sectors such as gold mining, garbage collection, portering in the markets, and working in brick-making and stone quarrying.”

In the gold mines of Peru’s Ananea glacier, children work in temperatures as low as 26 degrees below zero, the trade union added.

WTO sources said the growth of the Peruvian economy was driven by a rise in exports, and that mining, which received bulky direct foreign investment, accounted for much of that growth.

In Ferrero’s view, his country emerged successfully from this week’s trade policy review.