POLITICS-PERU: Humala to Lead Opposition from the Hinterland

By Ángel Páez Reprint | | Print |

Ángel Páez

LIMA, Jun 15 2006 (IPS) - While Alan García won Peru’s presidential runoff election by a 5.2 percent margin, nationalist leader Ollanta Humala is feeling anything but defeatist as he prepares to lead the opposition from the country’s poorest regions, where support for him runs high.

Firing Humala’s enthusiasm is the fact that he beat social democrat García in 15 of Peru’s 25 regions. The areas in which Humala received the majority vote represent 49.8 percent of the country’s poor, and are seen as fertile ground for organising protests against hunger, inequality and social marginalisation.

According to the National Statistics and Information Institute (INEI), 14.5 million of Peru’s 27 million people live in poverty, which is concentrated heavily in the southern highlands region, where Humala won a majority of votes.

Voters in Peru’s impoverished eastern and northern Amazon jungle regions also preferred Humala.

Humala predicts García will continue to follow the free-market neoliberal economic policies introduced by Alberto Fujimori (1990-2000) and maintained by President Alejandro Toledo, who will hand over the reins on Jul. 28. As evidence, he points to the president-elect’s support of the free trade agreement with the United States signed this year by Toledo but still pending ratification by Congress.

Humala is confident that those who voted for him in the Jun. 4 runoff will join the fight against the free trade deal, because he believes the issue dovetails with demands by Peru’s poorer regions that the State increase social spending and implement income redistribution policies.

However, this stance has alienated some former allies. Congressman-elect Carlos Torres Caro, Humala’s running-mate for second vice president, recently announced that he would form a separate bloc in Congress with as many as nine Union for Peru (UPP) members. The electoral alliance between the UPP and Humala’s Peruvian Nationalist Party captured 45 seats in total, more than any other single party.

Under the Toledo administration, Peru’s economy grew at an average annual rate of five percent, yet the poverty rate decreased by a mere 2.3 percent – and in southern Andean regions like Huancavelica, it actually increased by four percent. In fact, a report released by the local United Nations Children’s Fund (UNICEF) office last Friday revealed that 97 percent of children under 11 in Huancavelica live in poverty.

García’s American Popular Revolutionary Alliance (APRA) party has concentrated on planning strategies to reduce social unrest in poor regions, particularly those that tend to get swept up in the enthusiasm of populist movements in neighbouring Bolivia.

For example, the Sierra Exportadora is a five-year plan that calls for the government to help establish 150,000 hectares of new export crops such as potatoes, peppers, onions and artichokes in highland areas, thereby generating 300,000 direct and indirect jobs and one billion dollars in income.

But money is only part of the region’s problems; poor administration is also to blame. The UNICEF report shows that social spending increased by 58.1 percent during the period studied, to 170 dollars per person annually. Yet it still falls fall short of Latin America’s per capita average of 610 dollars.

Yawning standard-of-living gaps divide Lima and impoverished inland regions, and Humala’s strong performance in these areas can also be seen as a protest against a long-time centralist bias.

The “Multiannual Macroeconomic Framework (2007-2009)” report prepared by the Ministry of Economy and Finance just before the elections indicates that while per capita spending in Lima is up to 134.40 dollars a month, spending figures drop to less than half this amount in the poorer regions – with Huancavelica at the bottom, receiving only 38 dollars per person.

The people of southern Peru, who are mainly indigenous, generally make a living through subsistence farming, as the mining industry accounts for most exports in that area.

For example, according to the INEI, 99.6 percent of the Apurimac region’s exports are derived from silver ore and concentrates, 80.2 percent of exports from Puno are gold, and 74.5 percent of exports from Ayacucho are lead ores and concentrates.

Economy Ministry figures also show blatant discrimination when it comes to tax collection and distribution: regions like Cajamarca, Moquegua, Tacna and Cusco earn around half of their public revenues from royalties and taxes on exports – a proportion that drops drastically for Apurimac (0.39 percent), Huancavelica (3.03 percent), Ayacucho (0.95 percent) and other poor regions.

The imbalance stems from the fact that many mining companies do not pay royalties, because they have taken advantage of the so-called “contract laws” passed by the Fujimori regime and, in some cases, extended by Toledo.

Executives of these companies have already let García know they will not agree to any contract renegotiation.

Faced with growing social tension and Humala’s plans to mount stiff opposition, the APRA party is planning to apply five concrete economic measures, Congressman César Zumaeta told IPS.

These measures would focus on “Maintaining fiscal and macroeconomic stability; keeping in place the current monetary and exchange policies; strengthening the country’s position in the global market; developing a more dynamic agro-export policy, while incorporating the Andean corridor and jungle areas; and ensuring that growth is reflected in social improvements such as better education and health levels and better wages, to combat poverty,” he explained.

APRA has not yet mapped out a strategy to deal with the U.S.-Peru free trade agreement now before Congress, and stresses that the decision will take time. “It is a 2,000-page document and we cannot change so much as a comma – only vote for or against it,” noted Zumaeta.

“The free trade treaty also has seven bills attached to it, designed to provide compensation in areas that may suffer an impact, such as agriculture, intellectual property and, especially, medicine, biodiversity and labour issues,” he explained. “My party (APRA) is going to fight to increase compensation to 117 million dollars.”

Agriculture faces the greatest risks, primarily due to competition from heavily subsidised farm products from the United States; also, there is little demand in U.S. markets for Peruvian produce. Therefore, the sector is calling for agricultural reconversion plans, to help them switch crops.

Critics of the free trade agreement, which is unlikely to be debated by the outgoing legislature, also complain that the prices of pharmaceutical products will increase, thus driving up health care costs.

In the new Congress, which takes over Jul. 26, two days before García assumes the presidency, APRA has 36 seats, compared to the 45 won by the coalition that backed Humala.

However, the new government will be able to count on the support of 29 lawmakers from other parties, including National Unity, Toledo’s Possible Peru, National Restoration and the Centre Front.

Humala, who has said Congress should not deal with the free trade accord until the government has changed hands, is a loud-spoken opponent of the agreement.

The “TLC así no” (Not This FTA – Free Trade Agreement) coalition, made up of social, human rights, development, agricultural and labour organisations, says the treaty should be tossed out, because it was badly negotiated, behind closed doors.

While Humala’s detractors say his move to head protests against the free trade deal smacks of opportunism and is the behaviour of a “sore loser,” Not This FTA spokespeople disagree.

“I don’t think that Ollanta’s support for the fight against the FTA can be held against him,” Félix Álvarez, a representative of the Health Forum group in the coalition, told IPS. “This is a struggle about principles, and anyone who wants to join in is welcome.”

“Humala has been critical of the FTA right from the start of his election campaign. So I don’t see it as opportunistic, but as totally in line with what he’s been saying,” he concluded.

Humala has warned he is not going to let up on García. And it seems he will not have a hard time launching an anti-FTA campaign, as he already has behind him an army of the poor, who think he is right on the mark when he says politicians who do not prioritise the needs of disadvantaged populations are playing with fire.