Latin America's surprise rising economic star: Peru

Mr. Verna’s office, which was created earlier this year, keeps an eye on nearly 300 simmering local conflicts, almost half of which are related to mining, oil, or gas activities. The office plays the role of mediator in any conflict in which all the stakeholders have asked for dialogue.

“A year ago, only 25 percent of conflicts had dialogue. Now 50 percent have dialogue,” he says. “Peruvian society is evolving. Now, people who’ve historically been discriminated against are more a part of things.”

But as the central government devolves power from Lima, where one-third of the population lives, it’s finding that many regional governmental officials don’t have needed management skills.

“Competency training for regional officials is now vital,” says Verna’s boss and head of the ombudsman’s office, Eduardo Vega Luna.

And then there’s corruption. As regional budgets have exploded, so have the number of graft allegations against local and regional officials.

Still, by most accounts, there’s been tremendous progress on government accountability.

“Corruption affects all levels of government, but Peru has moved forward,” says Baca, of the Citizen Watch Program. “Any citizen can now see how money is being spent on a month-to-month basis.”

Peru is the only country in Latin America to sign on to the Extractive Industries Transparency Initiative (EITI), which was started in 2002 by former British Prime Minister Tony Blair to enable citizens to more closely monitor the flows of money from energy and mining companies to the host country’s local, regional, and federal government.

The goal of the initiative is to combat the government corruption that has plagued resource-rich countries, often leading to social unrest and deadly armed conflict.

Baca has been instrumental in coordinating efforts to independently audit willing oil, gas, and mining companies and ensure that payments by companies to the different branches of government – and revenues received by government – are widely publicized for any interested party to read.

A steep learning curve

Peru is nearing the end of the two-year process to become certified as completely EITI-compliant. It would be only the third such country.

The progress on transparency and accountability is “encouraging,” says Cynthia Sanborn, director of the research center at Pacific University in Lima. “There’s more learning from mistakes.”

But is Peru learning quickly enough?

During a visit to Peru earlier in December, Brazil’s president, Luiz Inácio Lula da Silva, signed 11 cooperation deals, mostly on trade and energy. Peru’s Garcia urged the scores of top-flight business leaders that accompanied Lula to invest his country.

“I’m deeply convinced that our peoples’ union and the road integration of our ports, flights, and trade will allow [us] to achieve both a very high level of well-being and [the] social justice we are all fighting for,” assured Garcia.

Coming months and years will reveal whether Peru’s political reforms will keep the “social justice” side of that equation on pace with its lightning-fast growth.

- Matthew Clark traveled to Peru on an International Reporting Project Gatekeepers trip.

Previous

1 | 2 | 3