PM GOES BEFORE CONGRESS; POTENTIAL FOR PROTESTS

C O N F I D E N T I A L LIMA 000918 SIPDIS E.O. 12958: DECL: 06/25/2018 TAGS: PGOV PREL PINR SOCI PE SUBJECT: PM GOES BEFORE CONGRESS; POTENTIAL FOR PROTESTS REMAINS REF: A. LIMA 904 ¶B. LIMA 888 Classified By: CDA James Nealon for reasons 1.4b and d. ¶1. (C) Summary. After diffusing protests in Andahuaylas on June 23, Prime Minister Yehude Simon was unable to reach a similar deal the next day in the town of Sicuani, where the demands were more political. Protest leaders there have given Simon three days to address their complaints, or they will resume demonstrations. Other protests in Jun!n have subsided, though the potential for social unrest remains high in Puno and other parts of the country. Separately, Simon and Interior Minister Mercedes Cabanillas appeared at Congressional hearings to answer for the June 5 incident in Bagua that claimed the lives of 24 policemen and 10 protestors, as well as supposed GOP interference in a TV station. Congress is slated to conduct a "censure" vote next week, but support for it appears to be waning. Some analysts believe that PM Simon, in trying to make social peace, has assumed too many commitments on behalf of a cabinet he may not be leading for long. Meanwhile, Simon continues in his role as firefighter-in-chief for a government facing simmering social conflicts around the country. End Summary. Some protests diffused, others continue ¶2. (C) After successfully diffusing protests in Andahuaylas on June 23 (ref. A),PM Simon, continuing in his role as firefighter-in-chief, was unable to reach a similar agreement the following day with leaders in the town of Sicuani, Canchis province (about a two hour drive from the city of Cusco). Analysts considered Sicuani a more challenging case to resolve because Simon had been there in one of his early actions as PM in 2008, and social leaders claim he has not delivered on promises made back then. Futhermore, the main Sicuani demands are political, not practical, in nature. Although Simon, accompanied by three other ministers, ceded to several demands, he did not agree to the main, political demands of cancelling the region's mining concessions or a major hydroelectric plant. Protestors gathered outside the site of the negotiations pelted Simon -- who was protected by his security detail -- with rocks and bottles as he left and announced that they would continue their now two-week-old road blockades in Cusco. ¶3. (C) Sicuani leaders subsequently announced they would call off protests for three days pending a government plan to respond to their demands. On one hand, some analysts believe that the protest organizers are trying to show "good will" in negotiations with the government, setting the stage for justifying continuing demonstrations when the government does not meet their demands. On the other hand, Sicuani's proximity to the tourist destination of Cusco allows protestors to create disruptions in travel and services, particularly to Machu Picchu, that can significantly impact economic activity there. Some speculate that the protestors struck a deal with the city of Cusco to temporarily suspend protests until the conclusion of the highly-attended Inti Raymi festival going on this week. ¶4. (U) Other protests in Jun!n have subsided while disruptions in Puno continue. Road blocks in Jun!n, east of Lima, have been called off for 30 days while details of a potential solution between a foreign owned mining company and its workers are worked out. Local community leaders also agreed to stand down but reiterated their right to protest the company's environmental practices. In Puno, a 72-hour strike, which has affected some towns in the area, continues. Organizers have promised to step up the pressure, while the military stands by to support police operations to maintain order. Simon and Cabanillas before Congress; Censure not Assured ¶5. (C) On June 25, PM Simon and Interior Minister Cabanillas appeared before Congress to explain the government's actions during the violent events of June 5 in Bagua (and also an unrelated issue involving a private television station.) Congress asked several questions about an unrelated scandal involving the attempted government takeover of a television station, then asked them to respond to only one Bagua question: "Who ordered police action to clear the roadblock at the Devil's Curve?" Following the 12-hour appearance in Congress, the Nationalist Party, with the support of the other opposition parties in Congress, submitted a motion of censure for both ministers. According to constitutional procedure, a majority of Congress's 120 total representatives is needed to approve censure. If Simon as Chief of Cabinet (PCM) is censured and forced to resign, so must the entire Cabinet. The censure vote, which must be held between four and ten days following the motion, is currently scheduled to take place next week. ¶6. (C) Although Simon announced publicly that he will resign once order is restored in the country, support for censure in Congress has reportedly waned. Our contacts have confirmed widespread media reports that proponents of the motion will be unable to secure the 61 votes needed for it to pass. Since publicly announcing his intention to resign after the Amazonian protests were resolved, Simon has since said he will remain as Prime Minister at least until July 8, when labor unions and other groups are planning strikes. Others have stated that Congress is reluctant to approve a censure vote because, according to the Constitution, if it formally censures more than one Cabinet in this way during a five-year Congressional period, the President is constitutionally permitted to dissolve Congress. (Ref B. Note: Simon would be the first Prime Minister censured during Garcia's term. End Note.) ¶7. (SBU) Some political figures supportive of censure have pointed out the contradiction that Simon, who may soon step down from office, has continued to assume commitments to diffuse protests on behalf of a government he may not represent in the near future. A Nationalist Party leader - going against the party line - has publicly stated that Simon should not be censured so he can follow up on the agreements he has been making around the country. Comment: Simon Could Remain as PM as Conflicts Continue ¶8. (C) Until Simon steps down as PM, he is poised to continue in his role as firefighter-in-chief for a government threatened by simmering conflicts throughout the country. As recently as last week, Simon appeared all but irredeemable, having angered several political parties by agreeing to repeal two controversial decrees in the wake of the bloodshed of Bagua. His successful negotiations at Andahuaylas may have bought him some breathing room while at the same time looming protests in Cusco and other parts of the country underscore the need for a lead government negotiator. NEALON