Peru: The Anti-Venezuela

On June 5, an ongoing dispute between the Peruvian government and the indigenous groups that occupy the Amazon region erupted in bloody mayhem. Since then, both sides have been trying to win the publicity battle. For investor-friendly President Alan Garcia, a victory would mean one thing: not following Venezuela and Bolivia as a lynchpin for foreign investors.

So far, the facts as to what happened June 5 are a bit fuzzy. As a result, both sides are trying to advance their own version. Thousands of Indians had been protesting the government’s decision to allow investors into the Amazon region to look for gas and oil. A blockade of Indians at the Bagua province forced the police to try to recover the main roads. This led to the deadly confrontation. The government places the official count of dead Indians at 10. Indigenous leaders, however, say that hundreds of protestors are still unaccounted for and that police threw some of the dead bodies into nearby rivers.

President Garcia has taken a proactive stance by defending the government’s decision to open up the Amazon region and by condemning the protestors that he believes caused the ruckus. This past week, the Interior Ministry’s office released a video that shows graphic footage of some of the police officers (24 in all) that were killed in the incident. In the video, Garcia says that the brutal police killings shows the “ferocity and savagery” of the indigenous leaders that are leading the protest. One leader, Alberto Pizango, fled to Nicaragua after being accused of sedition for inciting the violence.

In an effort to quiet the Indians, Garcia decided to suspend the decrees that originally caused the protest. However, indigenous leaders are not satisfied since he did not repeal them. This past week, thousands of protestors emerged across Peru to show their disapproval for Garcia’s policies. In some instances, police were forced to spray tear gas into the mobs.

At the heart of the issue is Garcia’s desire to see Peru continue its China-like economic growth through foreign investment. Some analysts believe that Peru’s growth may enable it to be the only Latin American country to remain untouched by the worldwide recession. Furthermore, Peru enjoys the competitive advantage of being surrounded by Venezuela, Bolivia, and Ecuador, all countries that have chosen to nationalize their energy industries. With an abundance of resources and very little regional competition, Peru has attracted investors from around the world. Garcia would like to keep Peru’s reputation for being a stable country for business.

Nevertheless, the Peruvian government has failed to take into account the political effect of not including the Indians in the negotiations over the Amazon region. There are more than 50 indigenous groups that live in the Amazon, an area that encompasses two-thirds of Peru. They represent only 1% of Peru’s total population. Because of the Indians’ small numbers, the Peruvian government has never seen the need to negotiate with them directly. However, Peru’s indigenous groups are much more organized than they used to be as evidenced by the mass protests throughout Peru this past week. The Bagua incident even caught the eye of American actress, Q’orianka Kilcher, who came to Lima to support the Indians.

Time will only tell if Garcia has pushed the Indians too far. Deadly protests are certainly not good for business.