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Viewing cable 07LIMA2617, PRESIDENT APOLOGIZES FOR SLOW PACE OF REFORM

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Reference ID Created Released Classification Origin
07LIMA2617 2007-08-02 14:47 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Lima
VZCZCXYZ0020
PP RUEHWEB

DE RUEHPE #2617/01 2141447
ZNR UUUUU ZZH
P 021447Z AUG 07
FM AMEMBASSY LIMA
TO RUEHC/SECSTATE WASHDC PRIORITY 6352
INFO RUEHAC/AMEMBASSY ASUNCION PRIORITY 1739
RUEHBO/AMEMBASSY BOGOTA PRIORITY 4918
RUEHBR/AMEMBASSY BRASILIA PRIORITY 7493
RUEHBU/AMEMBASSY BUENOS AIRES PRIORITY 3019
RUEHCV/AMEMBASSY CARACAS PRIORITY 0630
RUEHLP/AMEMBASSY LA PAZ AUG 4410
RUEHMN/AMEMBASSY MONTEVIDEO PRIORITY 9244
RUEHQT/AMEMBASSY QUITO PRIORITY 1365
RUEHSG/AMEMBASSY SANTIAGO PRIORITY 1420
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC PRIORITY
RUMIAAA/USCINCSO MIAMI FL PRIORITY
UNCLAS LIMA 002617 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
USEU FOR AMBASSADOR MCKINLEY 
 
E.O. 12958: N/A 
TAGS: PREL PGOV MARR ECON ETRD PHUM PE
SUBJECT: PRESIDENT APOLOGIZES FOR SLOW PACE OF REFORM 
 
 
Sensitive But Unclassified. Please handle accordingly. 
 
1.  (SBU) Summary: In his July 28 National Day address, 
President Garcia apologized for the central government's 
failure to move quickly to address social demands, which he 
said had helped spark widespread protests.  Garcia outlined 
an ambitious agenda for his next four years, focusing on 
poverty reduction, job creation, and infrastructure 
investment.  Emphasizing that the GOP had done everything 
necessary to conclude the Peru Trade Promotion Act (PTPA), 
the president said the treaty's fate now rested in the hands 
of the U.S. Congress.  Nationalists and labor leaders sharply 
criticized the address, and the congressional opposition 
faulted the president for failing to provide more details on 
how the GOP will meet its goals.  Still, Garcia's 
conciliatory tone and focus on Peru's social needs placated 
many critics and showed that administration has a clear 
understanding of what needs to be done to further consolidate 
democratic government.  End Summary. 
 
----------------------- 
The President's Address 
----------------------- 
 
2.  (SBU) In a two-hour address to the nation on July 28, in 
celebration of Peru National Day and on his one year 
anniversary in office, President Alan Garcia acknowledged 
that "profound problems and great social conflict" existed in 
Peru.  He apologized for the central government's slow pace 
of reform, which he said had caused public frustrations to 
boil over.  He called on Peru's poor to suspend their anger 
and to give the government a period of truce to deliver 
results.  Garcia insisted that administrative 
decentralization was the key to improving public services, 
and he said that 70 per cent of public funds were now 
controlled by regional and municipal authorities.  Garcia 
also apologized to public school teachers for the harsh 
rhetoric he had used during the national teacher's strike. 
 
3.  (SBU) Turning to the future, Garcia outlined an ambitious 
reform agenda that he hopes to complete before 2011, 
including lowering the poverty rate from 50 to 30 percent 
nationwide and reducing the percentage of persons in extreme 
poverty from 24 to 13 per cent.  He also promised to create 
1,500,000 new jobs during the next four years and to increase 
the percentage of workers in the formal economy from 35 to 50 
per cent.  Garcia also said the central government would 
invest $30 million on infrastructure, build 250,000 homes for 
low-income families, and ensure that 90 per cent of Peruvians 
had access to clean water. 
 
4.  (SBU) With respect to the PTPA, Garcia repeated publicly 
what he has told USG officials privately: the GOP has done 
everything necessary to ratify the accord and the ball is now 
in the court of the U.S. Congress.  Further delay, Garcia 
said, would offend Peru's national dignity.  (Note: Several 
government ministers have since publicly echoed the 
President's remarks on the FTA, calling on the U.S. Congress 
to finish the deal.  End Note.) 
 
------------ 
The Reaction 
------------ 
 
5.   (SBU) Nationalist leader Ollanta Humala offered the 
harshest criticism of the address, saying the Garcia 
government had aggravated the political crisis in the 
country.  The Peruvian Medical Federation said that the 
government had provided insufficient funding for public 
health, a failing Garcia failed to acknowledge.  In response, 
the federation announced a national strike for August 15. 
Peru's largest union, the Central Confederation of Peruvian 
Workers, complained Garcia had neglected to mention the lack 
of legal protections for workers in Peru and had failed to 
ratify the General Labor Law.  The teacher's union in Lima 
accepted Garcia's apology, but regional union leaders said 
they had no intention of ending protests. 
 
6.  (SBU) The regional presidents of Huancavelica, Puno, and 
Lima said they had not received the transfer of funds Garcia 
mentioned, and clarified that the lion's share of these funds 
went to only three of Peru's 24 regions.  They plan to meet 
with other regional leaders to make a case before Congress 
for more money.  Edgardo Reymundo of the opposition Union for 
Peru party said Peru's most serious problem is corruption, an 
issue the president had ignored, and Carlos Bruce of the 
Parliamentary Alliance faulted the president for failing to 
detail how he would achieve the goals promised by 2011. 
Several analysts noted that the speech was vintage Garcia, 
long on ideas but lacking specifics regarding implementation. 
 
------- 
Comment: 
------- 
 
7.  (SBU) Garcia can be one of Peru's most electrifying 
speakers, but on National Day he favored substance over style 
-- almost to a fault.  His apologetic opening was welcomed by 
many who have criticized the president for failing to admit 
mistakes.  Business groups were pleased by the president's 
blunt message on the PTPA, and even the congressional 
opposition acknowledged that progress has been made in 
consolidating Peruvian democracy in the past year.  Perhaps 
most important of all, the president recognized the urgent 
need to respond to the bread and butter grievances that have 
brought Peruvians into the streets, and he provided a broad 
brush agenda of what the government must do to address them. 
End Comment. 
 
 
WUNDER