PRESIDENT OF CONGRESS FLORES-ARAOZ TELLS

C O N F I D E N T I A L SECTION 01 OF 02 LIMA 001259

SIPDIS

E.O. 12958: DECL: 03/11/2015
TAGS: PGOV PREL ETRD PE
SUBJECT: PRESIDENT OF CONGRESS FLORES-ARAOZ TELLS
AMBASSADOR HIS HAT IS IN THE RING


Classified By: Ambassador Curt Struble for Reason 1.4 (B, D)


1. (C) SUMMARY. At a meeting with the Ambassador on 3/11,
Congress President Antero Flores-Araoz said he would be a
candidate for President in 2006. Flores described the ideal
electoral coalition as one including: the APRA Party; a
repentant leftist gravitating toward moderation, like
Lambayeque Regional President Yehude Simon; and elements of
the center. Flores said he had not discussed Free Trade
Agreement (FTA) ratification strategy with President Toledo,
and said FTA approval could get tricky as it got closer to
the Presidential election. He said he thought APRA Party
leaders had a core commitment to investment-friendly
policies. Flores thought that ProPeru, President Toledo's
plan to give a $30 monthly subsidy to Peru's poorest
citizens, was not viable, but he acknowledged it might be
difficult for members of Congress to vote against a program
with so much populist appeal. END SUMMARY.

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THE NEW LEGISLATIVE SESSION
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2. (C) At a breakfast meeting at the Residence, the
Ambassador inquired first about the status of major
legislative initiatives (ratifying the Law of the Sea treaty,
constitutional reforms, reinstating the Senate) and prospects
for passage in the current session. Flores-Araoz said that
on the Law of the Sea, there was no progress to note, and the
approach favored by Foreign Affairs Committee Chairman
Gustavo Pacheco of submitting the treaty to a referendum
makes passage in the Congress untenable. Flores said he had
told the executive branch to do a public affairs campaign on
this issue, as was done prior to the recent reforms in the
pension law (Decree Law 20530). The public needed to better
understand the costs and benefits associated with the Law of
the Sea.


3. (C) On a constitutional amendment to reinstitute the
Peruvian Senate (disbanded during the Fujimori regime),
Flores said he hoped to call for a vote by July. He said
that at a minimum some mechanism was needed so that two
separate votes are taken before a law is passed; in theory,
this requirement exists now in the unicameral Congress, but
as President of Congress, he can waive it any time he wants.
Recreating the Senate would help bring about transparency,
and avoid 12th-hour, dark-of-the-night abuses that have
occurred in the past.

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THE FREE TRADE AGREEMENT
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4. (C) The Ambassador laid out his view of likely progress on
the FTA, with negotiations ending in June, meaning that
consideration in the Peruvian Congress would take place no
earlier than November. He asked if Flores had discussed
ratification strategy with President Toledo. Flores said he
had not. He had hoped the matter might be brought before the
Congress by July. Flores commented that FTA approval would
become tricky the closer one got to the Presidential election
(March/April 2006),but was non-committal on a specific
timetable for consideration.


5. (C) The Ambassador asked Flores if he thought APRA party
leaders were sincere when they voiced commitment to
investment-friendly policies, given the party's
anti-capitalist traditions. Flores said they may not have
been sincere at first, but they were now -- it was like
someone who experimented with make-up, and ended up liking
the look of it. APRA's leaders on the whole were good
people. Ambassador noted that the heartland of APRA's
constituency, the northern and central coast, had benefited
immensely from export opportunities stemming from trade
liberalization. Flores agreed, and said that was why there
was a core of sincerity in their commitment to free trade.

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PRESIDENTIAL POLITICS
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6. (C) The Ambassador asked Flores' opinion on the need for
electoral coalitions and how these would evolve. Flores said
he did not agree with those (NOTE: referring to the leader
of his Unidad Nacional group, Lourdes Flores Nano, but not
specifically naming her; END NOTE) who dismissed forming
coalitions with unlike partners -- he felt that any
successful coalition would have to have a broad political
base.


7. (C) Flores said he would anticipate the Ambassador's next
question, i.e., would he run for President? The answer was
yes. He was 63 years old and felt now was the time to make a
run if he ever intended to. He could not envision returning
to the Congress and running for President in another five
years; it would be too much to ask of his wife. If he failed
in this attempt, he would be content to go back to his law
firm.


8. (C) Asked what a perfect electoral coalition would look
like, Flores said APRA must be a part of it, because they had
a solid base of 25 to 30 percent of the electorate, and the
closest thing to a political machine in Peru. A repentant
leftist like Lambayeque Regional President Yehude Simon would
be a plus, as well as elements more toward the center, like
the PPC (Popular Christian Party) or AP (Accion Popular).
Flores noted, however, that an approximation with AP did not
mean acceptance of party leader Victor Andres Garcia
Belaunde, who was a clown, and not close to the measure of
his uncle, former President Fernando Belaunde Terry. (NOTE:
Ambassador has heard similar comments about Garcia Belaunde
from Yehude Simon, who considers him untrustworthy. END
NOTE.) Flores thought that a primary election within Unidad
Nacional was a possibility, but that was putting the cart
before the horse, and inter-party alliances should be
negotiated first.

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BURDENS OF OFFICE
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9. (C) Flores lamented the burdens of the Congressional
Presidency, claiming that he had to do three jobs instead of
one. There was such disunity and lack of discipline in the
parties that he had to do the political work of the President
and the Prime Minister to get their members of the Congress
in line. An example was the insistence by members of
Toledo's Peru Posible that in response to ongoing anti-mining
demonstrations in Huaraz, a Congressional report on the
Barrick Mining Company's operation should be released to the
public. Flores said the report was two years old,
out-of-date, and would only serve to inflame the situation.
Flores was not completely negative about Toledo's
performance, however. He said Toledo had done a good job,
not interfering as things flowed in the right direction.
Flores-Araoz also praised the quality of Toledo's cabinet.

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PROPERU
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10. (C) The Ambassador asked how Flores thought the Congress
would deal with ProPeru, the President's plan to give a $30
monthly subsidy to Peru's poorest citizen. Flores said the
proposal was not viable, and he considered it an appeal to
populism, looking toward the upcoming election. If the
program were to be implemented, he said, it should be run by
Caritas (the Catholic relief services confederation) and not
by the government. The Ambassador observed that it might
prove difficult for members of Congress to vote against an
initiative with so much innate popular appeal. Flores
acknowledged this was the case, which was why he had not
publicly opposed it, but rather stated conditions it would
have to meet to work.

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COMMENT
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11. (C) Flores-Araoz's presidential candidacy is a long-shot,
but not out of the question. The same is true of the
proposed constitutional amendment to recreate the Senate, as
provincial legislators largely view it as likely to increase
Lima's political domination (the senators would be elected on
single national lists),while polls indicate the public
rejects adding 40-50 senators and their staffs to the
government payroll. We agree with Flores that APRA is
serious about its commitment to investment promotion in
theory, but note that the Apristas from Garcia on down often
do not understand what this means in practice. Flores-Araoz
has been an effective President of Congress, insuring that
the opposition-controlled legislature generally has a
constructive relationship with the Executive.
STRUBLE