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Bagua's Indigenous Protest One Year Later
June 7, 2010
by Naomi MapstoneA year ago this past weekend 34 people died near a section of road in
In many ways it was a typical Peruvian protest. The indigenous people who had congregated from all over the region to call for the right to be consulted over energy and mining projects on their land had blocked the road for several days.
Pressure built as essential supplies into the town of
It was at this point that Bagua departed from the normal pattern of protest in
Twenty-two people died in the ensuing clash, and protesters at an Imacita pumping station took hostage and later killed 12 police officers. The violence spilled over onto the streets of Bagua Chica and Bagua Grande.
Tags: Bagua, Peru, Social conflict
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France's Perenco Oil Company Leaves Ecuador Amid Tax Dispute
July 24, 2009
by Naomi MapstoneThe exit of French oil company Perenco from Ecuador has heightened concerns about the investment climate in the Andean nation. Announced earlier this week, the move comes after the seizure of oil concessions as part of a tax dispute. Officials from PetroEcuador, the state oil company, took control of concessions 7 and 21 in the country’s northeastern Amazon region last week, after Perenco warned it was about to halt production in response to Ecuador’s refusal to comply with a tax dispute ruling issued by an international arbitration body.
Rodrigo Marquez, head of the French oil group’s Latin American division, says the seizure amounts to an expulsion, leaving President Rafael Correa’s leftist administration exposed to billions of dollars in compensation claims. “We’ve been expelled and our assets have been taken over,” Mr. Marquez said. “They are trying to say they didn’t really take over the facilities because they didn’t send the army in, but the fact of the matter is that before we were due to start the suspension of activities, government officials went in and started to persuade the employees not to carry out their instructions. You would appreciate that an employee caught in that situation would feel somewhat intimidated.”
Luis Jaramillo, president of PetroEcuador seemed to think that the fact that authorities had not militarized the oil fields made it all OK. Although the explanation he gave Reuters did not aid his case: “We have had a dialogue with the workers and we have told them that if they stop the production they would affect the national economy.”
Perenco’s tax dispute with Ecuador dates back to October 2007, when the Organization of the Petroleum Exporting Countries (OPEC)-producing nation increased the windfall tax on oil from 50 percent to 99 percent. Although it later reset the tax at 70 percent, Perenco and its minority partner, Burlington Resources, a subsidiary of ConocoPhillips, have taken the dispute to a World Bank arbitrator, the International Centre for Settlement of Investment Disputes (ICSID). In May, ICSID ordered Ecuador to stop expropriating oil from the concessions, but Ecuador refused to comply, saying it had the right to recover a tax debt in crude.
Ecuador has now pulled out of the ICSID, a worrying development for international investors, although many analysts say ICSID’s rulings related to the Perenco concessions will still be enforceable.
Luke Peterson, of Investment Arbitration Reporter, makes the good point that enforceability will be difficult, however, pointing out that Ecuador could well follow the example of Argentina. “When it comes time to pay the awards [ordered by ICSID] Argentina hasn’t paid anything. Instead you see a cat-and-mouse game where multinationals chase Argentine assets around the world.”
While foreign oil operators in Ecuador such as Repsol, Andes Petroleum and Petrobras have largely accommodated the escalating demands of Rafael Correa’s administration for revenue sharing and control, Perenco is bucking the trend, according to Ramiro Crespo, of Quito-based Analytica Securities. “Instead of capitulating to the President’s high pressure take-it-or-leave-it offers, Perenco seems resolved to outduel Correa in his favorite game: chicken,” he said. Crespo, in a prescient note before the seizure of Perenco's fields, said Mr. Correa, perhaps emboldened by a belief that any credit he is missing out on from traditional sources such as the markets and multilateral lenders will be available through China or India, was motivated increasingly by ideology.
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From Lima: No End in Sight for Peru's Indigenous Protests
June 11, 2009
by Naomi MapstoneWhat a difference a week can make. Only days before Peruvian cabinet minister Carmen Vildoso resigned in protest at the government’s handling of indigenous land rights protests, she was touring Huancavelica, the country’s poorest province, showcasing anti-poverty initiatives.
Listening to campesinos’ stories of growing papaya and salad greens at elevations of 12,300 feet (3,750 meters) thanks to basic agricultural training and provisions, Ms. Vildoso seemed to be enjoying a rare “good news” moment in her portfolio. The Mi Chacra Productiva (My Productive Land) program, though small-scale (an initial $3.4 million budget to benefit 7,000 families), has begun to have an impact in the remote town of Pampas, which is about an hour’s walk from one of the main routes traversed by people hauling cocaine paste out of the valley of the Apurimac and Ene Rivers. Employment opportunities here are minimal, and for many years residents of working age have had to move to Lima or to the regional capital of Huancayo to feed their families.
For the first time, a timid young mother told me, her family could feed itself and produce enough extra guinea pigs or eggs to sell at the local market, which meant her husband could stay with the family.
Tags: Alan García, Peru
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From Quito: Reactions to Rafael Correa's Re-Election
April 29, 2009
by Naomi MapstoneI was a little taken aback last week when I told a high-minded Peruvian journalist I would be traveling to Quito to cover the presidential elections. Correa! she said, eyes alight, eyebrows waggling, her elbow giving me a knowing dig in the ribs.
I might have written this off as a case of sensory deprivation brought on by years of covering the none-too-pretty underbelly of Limeño politics, were it not for the groupies at Rafael Correa’s final Quito campaign rally this week. Starry-eyed, perfectly coiffed, with heavy eyeliner—and I think in one case, false eyelashes—they jostled for position at the barricades demanding to know when El Presidente would be there. Granted this was a political rally, and flag-waving, chanting and fist-waving are par for the course. But there is no denying the man has charisma.
And for now, it seems, he has the trust of the people. Correa’s closest rival, Lucio Gutiérrez, the former president ousted in 2005, outpaced expectations. But even so he raised the possibility of fraud. Exit polls, though, still show the president with a convincing margin of victory.
Tags: Correa, Economic Crisis, Economy, Ecuador, Elections
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From Lima: Fujimori Guilty for Crimes Against Humanity
April 9, 2009
by Naomi MapstoneAlberto Fujimori kept his head down, studiously taking notes, as a panel of three Peruvian judges found him guilty of crimes against humanity and sentenced him to 25 years in prison on Tuesday.
It took three hours to read out the verdict and sentence Peru’s former president for offences the court deemed “crimes against humanity.”
Tags: Fujimori, Montesinos, Peru
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