Identifier
Created
Classification
Origin
06LIMA1594
2006-04-25 22:13:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Lima
Cable title:  

AMBASSADOR PROMOTES FTA, ECONOMIC DEVELOPMENT IN

Tags:  ETRD EAID ECON EAGR PE 
pdf how-to read a cable
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


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