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Cablegate: Designing an Environment Ministry

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PP RUEHAO RUEHCD RUEHGA RUEHGD RUEHGR RUEHHA RUEHHO RUEHMC RUEHNG
RUEHNL RUEHQU RUEHRD RUEHRG RUEHRS RUEHTM RUEHVC
DE RUEHPE #0417/01 0671655
ZNR UUUUU ZZH
P 071655Z MAR 08
FM AMEMBASSY LIMA
TO RUEHC/SECSTATE WASHDC PRIORITY 8133
INFO RUEHWH/WESTERN HEMISPHERIC AFFAIRS DIPL POSTS
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RUEHC/DEPT OF INTERIOR WASHINGTON DC
RUEAWJA/DEPT OF JUSTICE WASHINGTON DC
RUEHLMC/MILLENNIUM CHALLENGE CORP

UNCLAS SECTION 01 OF 03 LIMA 000417

SIPDIS

SIPDIS
SENSITIVE

USTR FOR MBURR, BHARMAN & MCARRILLO
BRASILIA FOR HUB ABRAGHETTA

E.O. 12958: N/A
TAGS: SENV ECON ETRD ENRG EMIN PGOV USTR PE
SUBJECT: DESIGNING AN ENVIRONMENT MINISTRY

REF: 07 LIMA 3887

LIMA 00000417 001.2 OF 003


SENSITIVE BUT UNCLASSIFIED, HANDLE ACCORDINGLY

SUMMARY
-------
1. (SBU) Instructed by President Garcia, a commission of
experts presented draft legislation on March 3 establishing
an Environment Ministry in Peru and outlining its structure
and responsibilities. After discussion and tweaking by the
Council of Ministers, the GOP plans on creating the Ministry
using the temporary legislative powers delegated by the
Congress for U.S.-Peru Trade Promotion Agreement (PTPA)
implementation (reftel). Responding to long-standing
criticisms, the proposed Ministry would: have clout and
authority over other ministries on environmental matters,
have improved enforcement and sanctioning authority, approve
Strategic Environmental Studies as well as Environmental
Impact Assessments for large-scale or environmentally
sensitive projects, issue binding opinions on investment
projects that could affect Natural Protected Areas before
they move forward, and provide opportunities for civil
society involvement. The Ministry will not assume productive
responsibilities (e.g. timber concessions), and other
ministries will still maintain sector-specific environmental
offices that will follow the new Ministry's policies. End
Summary.

BACKGROUND: EXECUTIVE TO ESTABLISH NEW MINISTRY
--------------------------------------------- --
2. (SBU) Surprising even senior GOP officials, President
Garcia announced on December 20 that he would establish a
Ministry of Environmental Affairs. Garcia asked renowned
ecologist Antonio Brack to lead a commission to propose the
structure and functions of the new ministry. Brack's
commission, which included environmental officials, NGOs and
private sector representatives, was established February 1
and presented its proposal to the GOP on March 3. The
proposal is scheduled to be discussed by the Council of
Ministers on March 12, and the Executive plans on using the
legislative powers delegated by the Congress to implement the
U.S.-Peru Trade Promotion Agreement (PTPA, see reftel) to
establish the new ministry without need for a Congressional
vote (these powers expire June 28). Post has obtained a copy
of the Brack Commission's 15-page proposal, and below are the
structural and functional highlights most relevant to U.S.
interests.

PROPOSED MINISTRY STRUCTURE
---------------------------
3. (U) The proposal includes a Vice Ministry for the
Strategic Development of Natural Resources, a Vice Ministry
for Environmental Management, a Trans-Sectoral Environmental
Committee, an Environmental Coordination Council, and an
Environmental Dispute Resolution Tribunal. The Ministry's
internal administrative bodies would include a Regional
Coordination and Socio-Environmental Issues Office and a
Negotiation and International Cooperation Office.

4. (U) The Vice Ministry for the Strategic Development of
Natural Resources would include the following directorates:
Biodiversity and Coastal Marine Resources; Forest Patrimony
and Wildlife; Climate Change; and Environmental Land Planning
and Soils. The Vice Ministry for Environmental Management
would include the following directorates: Environmental
Policies, Norms and Valuation; Management Instruments;
Environmental Science, Technology and Innovation;
Environmental Education, Culture and Citizenship; and
Environmental Quality.

PRE-EXISTING & NEW ENTITIES UNDER MINISTRY
------------------------------------------
5. (U) The existing National Environmental Commission
(CONAM) would be fused entirely into the Ministry, along with
large portions of the Ministry of Agriculture's National
Institute for Natural Resources (INRENA) and the Ministry of
Health's Environmental Health Directorate (DIGESA). The
following existing GOP entities would be moved under the new
Ministry with varying degrees of autonomy: the National
Meteorological and Hydrological Service (SENAMHI, currently
part of Defense), the Geophysical Institute of Peru (IGP,

LIMA 00000417 002.2 OF 003


currently part of Education), and the Peruvian Amazon
Research Institute (IIAP). A new supervisory entity, the
Environmental Supervision and Enforcement Organism (OSFA),
the National Authority for the Management of Water Resources
and Basins, and the National Natural Protected Areas Service
(SERNANP) would be established.

PROPOSED MINISTRY FUNCTIONS
---------------------------
6. (U) The Ministry's overall mission would be to establish,
execute, supervise, and evaluate national environmental
policy applicable to all levels of government. Its scope
includes enforcement, control, and the imposition of
sanctions. Objectives would include:
-- promoting the sustainable use of natural resources;
-- conserving biodiversity and natural protected areas;
-- the sustainable development of the Amazon;
-- preventing the degradation of the environment and of
natural resources, and reverting negative processes that
affect them;
-- guaranteeing citizen participation in the decision-making
process for sustainable development;
-- contributing to Peru's competitiveness through efficient
environmental performance; and
-- incorporating sustainable development principles into
national policies and programs.

7. (U) The proposed specific and exclusive functions of the
Ministry include the following items of particular US
interest:
-- direct the process for elaborating and revising
Environmental Quality Standards and Maximum Permissible
Limits;
-- direct a National System of Environmental Impact
Assessments (EIAs) and approve all Strategic Environmental
Studies as well as EIAs for large-scale or environmentally
sensitive projects;
-- direct a National Environmental Information System;
-- establish the criteria and procedures for environmental
decontamination and recovery plans;
-- propose, approve, supervise and evaluate Natural Protected
Areas (NPAs) policies;
-- emit binding technical opinions on investment projects
that could affect NPAs and their buffer zones before such
investments move forward;
-- preside committees related to implementation of and
compliance with international environmental agreements; and
-- supervise and sanction all levels of government with
regards to solid waste, liquid effluents and air pollution.

FORESTS, INDUSTRY IMPACTS & STANDARDS
-------------------------------------
8. (U) The following two directorates will be key for PTPA
implementation. Forest Patrimony and Wildlife would be
responsible for the strategic development of forest
patrimony, including the ordering and the criteria for
protection and recovery of forests. Environmental Policies,
Norms and Valuation would be responsible for reviewing
Strategic Environmental Studies, approving EIAs for large or
environmentally sensitive projects, and elaborating and
reviewing Environmental Quality Standards and Maximum
Permissible Limits.

INCREASED CIVIL SOCIETY PARTICIPATION
-------------------------------------
9. (U) The proposal stresses increasing civil society
participation and public awareness. The permanent, 10-member
Environmental Coordination Council, proposed by NGOs and
adopted by the Brack Commission, would promote dialogue and
coordination on environmental issues among business
associations, civil society and the government. It would be
presided by the Minister and would include one member elected
from within each of the following groups: business
associations, environmental NGOs, Amazonian peoples
organizations, rural organizations, the National Assembly of
(university) Rectors, professional associations, regional
governments, local governments, and public environmental
entities. The Directive Council of the Natural Protected
Areas Fund (PROFONANPE) would be presided by the Minister and
include the following seven members: the head of SERNANP, a
representative from the Economy and Finance Ministry (MEF), a

LIMA 00000417 003.2 OF 003


representative from regional governments, three Peruvian
environmental NGOs with NPA experience, and one international
assistance or finance entity (invited by the Ministry).

STRONGER ENFORCEMENT & NPA PROTECTION
-------------------------------------
10. (U) The new Environmental Supervision and Enforcement
Organism (OSFA) would enforce, supervise, control, and
sanction corresponding environmental matters. This oversight
would include compliance with Strategic Environmental
Studies, EIAs for large or environmentally sensitive
projects, and environmental norms and standards. OSFA would
refer penal cases to the Public Ministry. Like other
ministries, the Environment Ministry would have its own
Public Prosecutor's office. Among its duties, the new
National Natural Protected Areas Service (SERNANP) would have
enforcement and sanctioning authority regarding Natural
Protected Areas. SERNANP would also be responsible for
emitting binding technical opinions on investment projects
that could affect National Protected Areas and their buffer
zones BEFORE such investments move forward.

PRODUCTIVE ASPECTS STAY WITH EXISTING MINISTRIES
--------------------------------------------- ---
11. (SBU) As Brack previewed on January 30 to a USG
interagency team, the new Ministry will not assume productive
responsibilities. For example, the commercial aspects of
timber will remain with the Ministry of Agriculture (which is
being reorganized this month), but the Environment Ministry
will take over the conservation and protected area aspects.
Similarly, Brack said that the environmental offices in other
ministries would not be closed, but the Environment Ministry
would oversee their activities. He added that elevating
environmental issues to the ministry level is a drastic
improvement over the current system that includes an
Environment Commission (CONAM) that does not have a seat at
the Council of Ministers, has no authority over other
ministries, and has no enforcement capacity.

COMMENT
-------
12. (SBU) President Garcia's decision to create an
Environment Ministry was a shrewd political move that
demonstrates his government's commitment to environmental
issues and addresses long-standing criticisms of government
policies and enforcement. The stringent commitments of the
U.S.-Peru Trade Promotion Agreement (PTPA), as well as the
international attention accompanying large-scale investment
projects (such as Peru LNG), helped Garcia reach his
decision. The proposal addresses many of the biggest
criticisms of Peruvian environmental framework: it
establishes an entity with authority over other ministries,
it improves enforcement and sanctioning authority, it reduces
the conflict of interest inherent in productive ministries
establishing and enforcing their own environmental standards,
it increases opportunities for civil society involvement, it
improves coordination with regional and local governments,
and it merges disparate offices to provide a centralized
location for the public (and foreign governments). In
addition to an Environment Ministry led by a qualified
minister, the GOP must improve the productive side of Peru's
environmental deficiencies to ensure sustainable development.
NEALON

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