Cablegate: Cajamaraca and Regional Unrest

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DE RUEHPE #4722 3531553
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R 191553Z DEC 06
FM AMEMBASSY LIMA
TO RUEHC/SECSTATE WASHDC 3410
INFO RUEHAC/AMEMBASSY ASUNCION 1570
RUEHBO/AMEMBASSY BOGOTA 4188
RUEHBR/AMEMBASSY BRASILIA 7131
RUEHBU/AMEMBASSY BUENOS AIRES 2706
RUEHCV/AMEMBASSY CARACAS 0012
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RUEHSG/AMEMBASSY SANTIAGO 1004
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RUMIAAA/CDR USCINCSO MIAMI FL

UNCLAS LIMA 004722

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SENSITIVE
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E.O. 12958: N/A
TAGS: PGOV PINR PHUM PE
SUBJECT: CAJAMARACA AND REGIONAL UNREST

REF: LIMA 4519

1. (SBU) Summary: Cajamarca may be emblematic of the broader
regional challenges facing the Garcia administration, namely
persistent poverty and rising frustration with inadequate
public services that fuel antipathy towards all levels of
government. Social discontent in Cajamarca has at times
metastasized into conflict with the region's largest
employer, Yanacocha mining company. Because Cajamarca has
long been a ruling APRA party stronghold, it raises questions
about the Garcia government's plan to decentralize both
authority and blame for problems to regions and
municipalities. End Summary

2. (SBU) Persistent poverty has characterized life for a
significant majority of Cajamarca's residents. Located on
the country's northern border far away from the marginalized
southern regions that are the focus of the government's
poverty alleviation efforts, Cajamarca ranked as one of the
poorest regions in Peru in 1993 -- 22nd out of 25
departments. Thirteen years later, Cajamarca ranks 23rd.
Regional officials told poloff during a recent visit that 40
percent of children in the region are malnourished, and 60
percent of homes lack electricity. They also described a
simmering frustration with the status quo, where government
promises -- at the national, regional and municipal levels --
come and go with each election but the situation fails to
improve. In that sense, Cajamarca is emblematic of the
broader regional challenges confronting the Garcia
administration.

3. (SBU) Following repeated and vain petitions to the
government, local populations have found a ripe target for
their anger in Cajamarca's mining sector. Most recently, in
August local residents, frustrated by a lack of roads and
clean water, blockaded the activities of Yanacocha mining
company (which is operated by Newmont, a U.S. firm). One
leader of the protest, Father Marco Antonio Arana, told
poloff that direct action against Yanacocha was justified
because local government had proved unresponsive to popular
demands. Communities have also been angered by the lack of
access to the mining "canon," funds reserved from mining
taxes and earmarked for local infrastructure projects (but
controlled by the central government). The protest ended
when Yanacocha promised to build a road linking local towns
and a number of water filtration stations. (Comment: In that
sense, the mining company has shouldered blame for the public
sector's failures, and is pressed to provide the kinds of
public services that governments normally dispense. End
Comment.)

4. (SBU) Problems in Cajamarca raise questions about the
Garcia government's plan to decentralize responsibility and
blame for problems on to regional and local governments. In
a November speech criticizing the failures of regional
governments, President Garcia cited Cajamarca as an example
of bad government, noting that local authorities had ignored
pressing needs like child malnutrition. Ironically,
Cajamarca has long been a ruling APRA-party stronghold: APRA
candidates had won mayoral elections four times in a row, and
also held the regional presidency -- until now. In the
November 19 municipal elections, the APRA incumbent lost the
regional presidency, and the mayor was re-elected by a
razor-thin margin. In that sense, Garcia's strong words
indirectly targeted his own party, and suggested that in the
long run the central government will have difficulty esaping
blame for public sector failures at the local level.

5. (SBU) Comment: President Garcia may succeed in the short
term in shifting anger for ineffective government from the
national to local level, and in securing the support of the
private sector through "voluntary contributions" to the
communities in which they operate. But in Cajamarca as in
other poor regions of Peru, the government, at all levels,
will have to correct its own failures -- and begin providing
the basic services that populations increasingly demand -- if
it hopes to avert social conflict in the future. End Comment.
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