Peru's Model Self-Help Town. Villa El Salvador has won international praise for its effective grass-roots management. COMMUNITY DEVELOPMENT

VILLA EL SALVADOR is always the good news in the Peruvian press. Among the articles reporting higher inflation, peasants massacred, and a deteriorating presidency, journalists and readers alike look forward to the stories about this ``new town'' of more than 300,000 people on the outskirts of Lima. In only 18 years, residents have created a community that is a remarkable example of self-help development. Ever-expanding shantytowns - pueblos jovenes (young towns) surround Lima. Many are literally sand dunes made into cities by poor people fleeing rural poverty and warfare where guerrillas and government soldiers compete for the peasants' loyalty.

Villa is just one pueblo joven, but its triumphant style of self-management has thrust it onto the national political scene and the international as well. It has won two awards: the prize of the Prince of Austurias, which is voted on by the Latin American ambassadors to Spain, and the designation of Peace Messenger by the United Nations.

``Since its birth, the people of Villa El Salvador had in mind that this couldn't be a traditional pueblo joven,'' said second-term mayor Miguel Azcueta. ``The people have achieved a unity and their own identity on a national level in Peru.''

Politicians from every party want to take credit for supporting Villa El Salvador. The most recent law passed on Villa's behalf took nine days, a record in Peru.

``The poor people have always been used by politicians to get elected,'' said attorney Patricia Iturregui. ``Now it's the contrary.'' In this case, a popular poor community has gained influence over elected leaders. Villa has been the salvation of thousands of families, and 300 more people arrive monthly hoping to start a new and better life.

Your shoes fill with sand as you walk along the unpaved roads. The streets are busy with vendors selling food, people hauling their garbage toward the truck that stops momentarily at each corner, and many residents are destined for meetings with a women's club, youth group, or trade union.

Seventy percent of Villa's inhabitants are under 25 years old. Wage-earners make an average of $70 per month. (The national average in 1984 was $940.) But Villa has electricity, water every two days (though for some it is delivered by a truck in plastic bags), schools, and health centers. And it is the only city managed from the grass-roots level in Peru. For these reasons it has been visited by world leaders such as Pope John Paul II, former Tanzanian President Julius Nyerere, and Nicaraguan Minister of the Interior Tom'as Borge.

In addition, Villa is a sister city to cities in Spain, France, West Germany, and the Soviet Union. This year the World Assembly of Mayors of Sister Cities brought 200 mayors from around the globe to Villa.

The community's success story began in the early morning hours on May 1, 1971, when 500 poor families living in unsanitary, crowded Lima slums, packed their belongings and invaded an unused piece of private property. By May 3, there were 4,000 settlers. And by May 5, the confrontation between them and the government resulted in Villa's first martyr.

Gen. Juan Velasco, who had come to power in a coup in 1968, was determined to accommodate the poor peasants arriving in Lima from the countryside (some as a result of his failed agrarian policy). He designated a parcel of state land southwest of the capital for them, giving free lots so that they could construct their own homes, albeit from straw. For this his likeness is depicted by Villa's only public statue.

Now, only the newest arrivals live in straw houses.

In 1973, the people designed their own type of government, officially called CUAVES, the Self-Managed Urban Community of Villa El Salvador. They follow their own model of urban development, which allows for private enterprise in a communally focused system. The plan, the Popular Integral Development Plan, is nationally famous.

Everyone has a voice in this highly organized and decentralized system. There are 110 residential groups of 2,500 people each. Within a residential group are 16 blocks, each of which consists of 24 families. The block elects a leader, and because of the small number of families, many people get a chance at the two-year position. Each residential group has a secretary-general, who is responsible for developing his or her area according to the development plan.

For example, each residential group has a central park which normally consists of a basketball court, surrounded by the the meeting hall, health post, communal kitchen, and kindergarten. These are planned by the people themselves, and built on Sunday, the communal labor day.

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