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Viewing cable 06LIMA1594, AMBASSADOR PROMOTES FTA, ECONOMIC DEVELOPMENT IN

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Reference ID Created Released Classification Origin
06LIMA1594 2006-04-25 22:13 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Lima
VZCZCXYZ0013
RR RUEHWEB

DE RUEHPE #1594/01 1152213
ZNR UUUUU ZZH
R 252213Z APR 06
FM AMEMBASSY LIMA
TO RUEHC/SECSTATE WASHDC 0034
INFO RUEHBO/AMEMBASSY BOGOTA 3312
RUEHQT/AMEMBASSY QUITO 0275
RUEHLP/AMEMBASSY LA PAZ APR SANTIAGO 0452
RUEHCV/AMEMBASSY CARACAS 9351
RUEHBU/AMEMBASSY BUENOS AIRES 2355
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
UNCLAS LIMA 001594 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR WHA/AND, EB/TPP/BTA/ANA 
USTR FOR B. HARMAN 
COMMERCE FOR 4331/MAC/WH/MCAMERON 
AID FOR NOREEN JANUS 
 
E.O. 12958: N/A 
TAGS: ETRD EAID ECON EAGR PE
SUBJECT: AMBASSADOR PROMOTES FTA, ECONOMIC DEVELOPMENT IN 
JUNIN 
 
 
1.  (SBU) Summary.  During his April 18-19 trip to Junin, a 
Department in the Peruvian highlands, the Ambassador met 
with several local dignitaries and agricultural producers to 
discuss the U.S.-Peru free trade agreement and economic 
development.  The Ambassador toured several facilities that 
receive technical assistance from USAID.  During the tour, 
the Ambassador explained to the press how poor farmers can 
improve their economic wealth by shifting away from 
traditional crops, such as potatoes, to growing high value 
crops for export, such as trout or artichokes.  He also 
emphasized how the U.S.-Peru free trade agreement will 
permanently open markets to Peruvian agricultural producers, 
thereby encouraging economic growth in areas outside of 
Lima.  End Summary. 
 
Tools for Promoting Economic Development 
---------------------------------------- 
 
2. (U) The Ambassador, during an April 18-19 trip to the 
Peruvian highlands, toured several agricultural projects in 
Junin that receive funding and technical assistance from 
USAID's Poverty Reduction and Alleviation (PRA) project. 
USAID funds nine PRA Service Centers in Peru; these centers 
seek to promote economic development in the highland and 
jungle areas by matching up small producers with the 
Peruvian and foreign private sectors.  In more than six 
years of existence, the PRA project has generated close to 
$100 million in new sales and has created more than 46,000 
new jobs. 
 
3.  (U) Accompanied by Luis Felipe Urbina and Zulma Geri of 
the PRA Service Center in Huancayo and 12 local press, the 
Ambassador met with local trout and artichoke farmers, as 
well as toured artichoke and trout processing plants on 
April 18.  Esteban Torres, the artichoke farmer, proudly 
showed the Ambassador a seven-hectare plot of artichokes, 
noting how he was unable to care for his family when he grew 
potatoes.  With the help of PRA, Torres diversified his 
crops, switching to artichokes, which not only grow well in 
the Junin highlands, but are also in high demand 
internationally.  Torres, who now has over 30 hectares of 
artichokes, has become one of the primary artichoke farmers 
in the Department and also acts as a consultant to farmers 
in Cusco and other areas that want to shift from traditional 
crops to higher value exportable crops.  Using Torres as an 
example, the Ambassador emphasized how local producers need 
to take advantage of export opportunities under the U.S.- 
Peruvian free trade agreement. 
 
4.  (U) The Ambassador also met with Augusto Fernandini 
Frias, the General Manager of Agromantaro, a local artichoke 
processing plant.  Fernandini explained to the Ambassador 
and the press how he received support from USAID and PRA in 
2004 to build a processing plant.  His plant now employs 
more than 100 people, who clean, cook and process locally 
grown artichokes for export to Europe and the United States. 
Under ATPDEA, these artichokes enter the U.S. duty free; if 
the free trade agreement is not passed, Peruvian artichoke 
farmers must pay a 14.9 percent duty on processed artichokes 
that enter the U.S. market. 
 
5.  (U)  Luis Felipe Urbina, General Manager of PRA 
Huancayo, informed the Ambassador that trout farming has 
also become popular, and PRA has several technical 
assistance programs for small trout farmers.  During a tour 
of a small trout farm and a large trout processing plant, 
the Ambassador witnessed how local producers are able to 
take advantage of the climate and natural resources of Junin 
to develop the economic competitiveness of the region. 
 
Issues in Rural Peru 
-------------------- 
 
6.  (SBU) During his trip, the Ambassador met with several 
local mayors to discuss social and economic challenges in 
the region.  Luis Balvin, the Mayor of Jauja, noted that the 
majority of people living in the region are farmers who are 
dependent upon the Mantaro River water supply.  Balvin 
 
explained that contamination of the river is a real problem, 
as large mining companies, such as U.S.-owned Doe Run, are 
polluting the area.  Additionally, only 30% of people living 
in the Jauja area have access to piped, potable water.  The 
Ambassador, recognizing the importance of clean water, 
pointed out that Doe Run has undergone extensive clean up 
efforts in recent years. 
 
7.  (SBU)  In addition to echoing concerns about 
contamination, Luis Heras, the Mayor of Molinos, explained 
that the smaller towns in Junin do not receive any of the 
mining cannon funding.  Due to lack of funding, the local 
governments have been unable to improve infrastructure -- 
roads, bridges, and telecommunications.  However, Heras 
highlighted how his government is looking to promote 
tourism.  The Municipality of Molinos recently procured a 
large telescope and is working with several Peruvian 
Universities to develop astronomy courses.  Heras also noted 
that his government is promoting the development of new 
crops for export. 
 
Comment 
------- 
 
8.  (SBU)  Junin, like many areas in the Peruvian Andes, 
remains disconnected from the more developed coastal areas. 
Economic tools such as USAID's PRA project and the free 
trade agreement provide Peruvians with opportunities to 
develop and export new products, thereby creating new jobs 
and fostering economic growth.  Testimonials from Peruvians 
such as Esteban Torres highlight how important these 
projects, and particularly the FTA, are to the elimination 
of poverty in rural Peru. 
 
STRUBLE