As voters go to the polls, they focus their anger on the unequal distribution of Peru’s mineral wealth
WHEELING THEIR new microwave out of a jam-packed shopping centre in an upwardly mobile suburb of northern Lima, Luis and Giovana Flores have no doubt that life in Peru is getting better.
A decade of record economic growth means more work and more money to spend on their home. “When we got married in 1990 it was a very difficult time,” remembers Luis. “There was the war with terrorism and hyperinflation, followed by shock therapy. It was a disaster. We lost the little savings we had. Now finally we are getting back to where we were.” The Flores family are members of a large new emerging middle class in this country of almost 30 million. Just do not expect them to thank the country’s politicians for their rising fortunes. “They are corrupt and useless and only out for themselves,” says Giovana. “Things are improving because of people’s own efforts. We have made things better but the state is far behind.” Such anger helps explain the disarray among traditional parties in Peru. Though he oversaw five years of Chinese-like growth rates outgoing president Alan García saw his centre-left Apra party’s candidate to replace him come in an also-ran along with centre-right candidates in April’s first round of voting. His party will have just four representatives in the new 120-seat congress.
When voters went to the polls yesterday to elect a new president they had to choose between two controversial populists – right-winger Keiko Fujimori and left-wing nationalist Ollanta Humala – with the traditional political class reduced to onlookers. (Vote counting was ongoing at the time of going to press).
“What is the point of all this growth they talk about when we still have clinics that are a disgrace and schools where there are too few teachers? Yes my family now has a little more money but I still cannot get my children a good education,” says Marta Ordonez, a seamstress in a shop near Lima’s bustling market. Ordonez said she voted for Humala because she wants the “Mafia” that runs the country kicked out.
“The state has done a lousy job in health and education which is among the worst in the world. Chronic malnutrition has declined but it is still very bad,” says Miguel Palomino, director of the Peruvian Institute of Economy. “There has been improvement but given that the government budget has tripled in the last decade you must realise it has not done that great a job. The truth is everyone is correct in being unhappy.” This unhappiness is increasingly being focused on the motor of Peru’s boom – voracious global demand for the country’s abundant deposits of gold, silver and copper. Mining accounts for almost 70 per cent of its export revenue but with a third of the population still mired in poverty and more than three million destitute, there are increasing demands that this mineral wealth be more equitably distributed.
Last month residents in the southern Andean region of Puno set up roadblocks, furious at the government’s granting of a licence to a Canadian miner to work the region without consulting local communities, which are among the poorest in Peru. Such protests are increasingly common.
“There is huge dissatisfaction with the economic model across the country,” says Giofianni Peirano, of the School of Government and Public Policy at Lima’s Catholic University. “The actual economic model does not allow for efficient redistribution of riches. The Puno conflict was the result of a large foreign miner getting the right from Lima to operate in the region without any consultation with the local population. Lima will collect the revenue while the environmental impact will be felt in Puno. This system of governance needs to be reformed,” he says.
Left-wing candidate Ollanta Humala says he will involve local communities more closely in the country’s mining boom and promises to raise taxes on miners to help fund improvements in education and health. Fujimori says her opponent’s policies risk choking off foreign investment and halting growth. But this has not stopped her from advocating a windfall tax of her own on miners.
But whoever is the new president, and with polls showing the two candidates in a technical tie, it could take two weeks to count all the votes. Grabbing a bigger share of the boom for the state will not quickly resolve Peru’s problems. “There is a problem of governance and governability. The state’s reach is very limited and this model needs to be changed,” says Peirano.