Bridges Trade BioRes • Volume 9 • Number 12 • 26th June 2009

Peru Overturns Land Laws in Wake of Violence

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Two controversial laws that loosened development restrictions in Peru’s Amazon regions have been repealed after dozens were killed in clashes between indigenous protesters and police. Observers say the move could trigger a re-evaluation of the US-Peru Trade Promotion Agreement (TPA), which entered into force on 1 February.

Protests over the laws - which demonstrators say would have opened areas of the rainforest to mining and energy development - had been simmering since April. Some 15,000-20,000 indigenous people took part in the relatively-peaceful demonstrations, which included blockading highways, shutting down an oil pipeline pumping station, and obstructing rural airports.

But tensions boiled over on 5 June when security forces attempted to remove a roadblock on a stretch of highway near the town of Bagua Chica. Reports estimate that at least 34 people - 11 officers and 23 civilians - were killed in the botched operation.

President admits errors

While President Alan García initially blamed protesters and ‘foreign agitators’ for the violence, he eventually issued an apology for the violence and for failing to consult with indigenous groups before passing the laws. “There comes a time to recognise that there were a series of errors,” he said in a speech before Congress.

García requested that Congress throw out legislative decrees 1090 and 1064, which were initially passed to bring Peru’s regulatory framework in line with the country’s bilateral trade deal with the US - seven less controversial laws remain. Indigenous leaders said they were satisfied with the government’s decision and requested that demonstrators cease protesting.

“This is a historic day for all indigenous people in Peru,” said Daysi Zapata, director of the Indian rights group Aidesep. However, Zapata also cautioned that because seven laws remain, more protests could be in the pipeline.

García’s minority government is still struggling with the backlash over the way the government handled the protests. The government’s chief of staff has announced his resignation and political analysts say a cabinet reshuffle will likely come in July.

Yehude Simon, the country’s prime minister, has also offered to resign and said a national commission should be formed to foster reconciliation.

“Sadly, it seems to take violence for Peru to know itself, and we’ve learned we’ve made some big mistakes from not listening,” Simon said. “We know we are very behind from where we should be, but the president is committed to making up for lost time.”

Many observers have said that the violence has forced the country to acknowledge the ‘second-class citizen’ status of indigenous people in Peruvian society.

Economic policies will not change: Finance minister

Since being sworn in as president in July 2006, García has pursued a strong free-trade agenda. In addition to approving the US trade pact, he is actively seeking similar deals with Canada, China, the EU, and Japan.

Ratifying the US TPA, which George W. Bush announced as one of his final official actions as US president, did not come easily. The then-Bush administration faced significant opposition from Democrats and labour unions over workers’ rights and environmental protection in the South American country (see Bridges Weekly, 21 January 2009, http://ictsd.net/i/news/bridgesweekly/38202/).

At the time, then US Trade Representative Susan Schwab insisted that new Peruvian legislation had addressed these concerns and satisfied labour and environmental requirements. “With the president’s issuance of a proclamation to implement the US-Peru Trade Promotion Agreement as of February 1, 2009, I am very pleased to be able to celebrate the entry into force of this important trade agreement,” Schwab said in a statement.

In seeking free trade pacts, García has not shied away from promoting private investment as a means to boost the economy. In the past, the president framed his foreign investment promoting agenda as a means to help preserve the environment, saying it would bring order and formality to the Amazon, where illegal logging and gold mining are rampant.

Political analysts now speculate that the mis-handling of the protests will force García to alter his agenda. Still, Luis Carranza, Peru’s finance minister, said despite the government’s reconsideration of the two decrees, there will not be a shift in economic policies.

A recent Ipsos Apoyo poll revealed that that García’s approval rating has dropped precipitously since the clashes. The pollster also found that 90 percent of Peruvians believe the president should have consulted with indigenous groups before passing the controversial laws.

Political analysts have said that while García will likely be able to complete the remaining two years of his term, it will not be easy.

While indigenous leaders have called off protests in the Amazonian regions of the country, demonstrations over other issues - such as highway improvement, mining concessions, and hydroelectric projects - continue in other areas of the country.

ICTSD Reporting; “Peru’s Congress Repeals Laws Behind Amazon Clashes,” REUTERS, 21 June 2009; “Peruvian troops patrol Amazon towns after 60 die over forest protests,” REUTERS, 9 June 2009; “ANALYSIS-Peru’s Garcia to struggle for rest of term,” REUTERS 23 June 2009; “Amazonian Indians End Protest After Peru’s Congress Repeals Decrees,” ENVIRONMENT NEWS SERVICE, 19 June 2009.