Highlights
-Weeks of protests continue against free-trade policies
-Call for insurgency is withdrawn, but legal demonstration will increase
-Both parties reluctant to compromise, with a solution foreseeable only in the medium to long-term
On May 15, 2009 Indian leader Alberto Pizango announced the 30,000 indigenous protesters were revoking a call to insurgency. Some 30,000 people have held a month-long protest in Peru’s Amazon region, resulting in violent clashes with security forces as the activists call for a repeal of decrees passed relaxing restrictions over oil exploration and development.
As the government aims to convert Peru into a net oil exporter, we believe the administration will likely not succumb to the demands of indigenous communities in the near term. However, should President Garcia’s strategies begin to receive harsh criticism from international human rights and environmental groups in the medium to long-term, Lima may become more flexible over indigenous concerns.
Background
Indigenous communities have blocked roads and waterways since early April 2009, intending to pressure the government to revoke decrees aligning Peruvian law with a free-trade deal with the United States (US). These groups argue large transnational corporations will assume control of sovereign lands.
•Protester hindered business operations and production at companies, including Argentina’s Pluspetrol, French-English Perenco, Petroperu and Talisman.
•Local media sources reported 41 vessels serving energy companies were stuck and unable to move further than the jungle rivers due to the protests.
•Peru’s environment minister stated protesters blocked two of Petroperu’s pumping stations, similar to demonstrations in 2008 that forced the company to shut its northern pipeline.
In reaction to escalating social unrest, the government declared a state of emergency in the central regions of Loreto, Amazonas, Ucayali and Cuzco, heralding deployments and the enforcement of martial law.
Alberto Pizango, president of AIDESEP, a leading Peruvian rights group retaliated by calling for an “insurgency” against the governments obstinacy, stating:
“Insurgency means to disobey, to not recognize the authority of (President) Alan Garcia, despite the state of emergency…The state is stripping us of our territories and whatever happens next is the government’s responsibility.”
Withdrawal Over Misinterpretations
Only one day following the declaration, Pizango indicated the government misinterpreted the group’s intentions and “for that reason (withdrew it).” He also highlighted the mobilization would continue to escalate “within the rule of law.”
•The government released warnings that anyone participating in an uprising could be charged with sedition and authorized armed forces to support police in five Amazon provinces, indicating negotiations between the polarities have likely disintegrated and the state fears violent civil unrest.
Government Commitment To Development
President Alan Garcia continues to defend the controversial laws. He believes they will help develop the totality of the impoverished nation, rather than benefit a small sect of citizens who occupy the lands. Although he calls for understanding from indigenous groups, Garcia adheres to Peru’s constitution understanding that the state is owner to the country’s mineral and hydrocarbon wealth.
Peru’s military will be deployed for 30 days to monitor the escalating dispute and will not hesitate to intervene to ensure roads, airports and other essential services remain operational.
Outlook
As the government aims to convert Peru into a net oil exporter, we believe the administration will be unwilling to succumb to demands from indigenous communities wishing to halt legislative progress towards development.
The administration will continue to utilize the armed forces to maintain business and services continuity, as is permissible under the constitution. Negotiations will remain stalled for the near-term, but will likely continue with more moderate expectations by the indigenous groups in the medium to long-term.
AIDESEP, among thousands of additional indigenous communities, will continue demonstrations despite military targeting of their activities. More violent clashes and arrests are expected in the near-term. If the controversy extends for the medium to long-term, the Peruvian government may receive renewed and increased criticism from environmental and human rights organizations, which have continually claimed development threatens to damage ecological systems and risks exposing remote tribes to novel and deadly diseases. This may catalyze compromises in to the governments’ aggressive development policies.
