At the end of October, a conference took place in Lima between a team of Spaniards from the Spanish Socialist Workers’ Party (PSOE - Spanish acronym), presided over by Felipe González and Carlos Solchaga, together with the Peruvian government represented by Alan García, which turned out to be a complete farce according to observers. It’s necessary to point out that between 1992 and 2000, while García was in exile in Paris, that he was leader of the Socialist International with González as his patron. This indicates how close García and González are at a time when Spain is the front door for Latin America to the European Union. The theme of the conference was integration, a subject which intersects with political interests in ways not always favorable to Europe on the international scene. For Peru, or rather for the US-based transnational corporations and united under the American Chamber of Commerce, Europe is irrelevant. What matters is the Free Trade Agreement (FTA) with the United States regardless of the cost. This is the line that President García is taking, who, in his resurrection on the extreme right, has become his own nemesis.

During the meeting, environmental policies for the conservation of the Amazon were referred to several times as being useless. What matters with regard to the Amazon are not its trees and the uncontacted people that live there, but rather the petroleum lying underneath, making reference to Rafael Correa and his protection of the nature reserve Yasuní and the uncontacted populations in the area. García then asked the visitors not to confuse Peru with their neighbors to the north nor to the south. He forgot about the east and the southeast, and the northeast. Or let’s just say, he forgot about reality. But it’s difficult to forget where Peru is, because this country is sabotaging the Andean integration that is underway and seems to be signaling for the transfer of the US base at Manta to Peru.

Shortly before the arrival of the Spanish mission, Peru dropped its tariffs on 4,224 items to give a sign of good faith to the United States and of bad faith to the rest of the Andes and to Europe. They have also already allowed the entrance of the US army onto Peruvian territory. The message "don’t confuse us with the others" is directed, in part, in search of a privileged relationship and, on the other hand, to provide some form of security that few are disposed to give particularly in the midst of the global climatic crisis and the global economic crisis, referred to for the “subprimes”, and that has already snared high-flying victims, due to the high price of petroleum at $100 USD a barrel and the price of gold at nearly $800 USD an ounce. The amazing thing is that he’s trying to please the United States of Bush - who no one thinks will survive the judgment of history - simply in order to sell more raw materials that increase revenue, but neither generate employment nor increase the investment rate.

Escenario de la integración

The scenario with regard to integration is divided into two groups, those in favor of the so-called “energy ring” and a new regional financial architecture, and those against. Within this context, only Peru is not playing along and trying to go it alone, something previously characteristic of Chile. Another division is that which Emir Sader describes: those who believe in South American integration and those interested in a TLC with the United States. But in that divide, Colombia has fallen and Uribe immediately turned towards incorporation with the Bank of the South, on inaugurating the oil pipeline with Venezuela, the first link in the energy ring.

Venezuela is not living through the most auspicious times, having to consider the indefinite re-election of its president, but that is no reason to destroy an integration scheme such as the Andean, when a counterbalance to the United States and its strategy of subordinate integration is at stake globally. Within this context, González and Solchaga arrived to talk and then returned home disturbed. García doesn’t believe in counterbalance. With two cabinet ministers who have been part of the Andean Community, Alan Wagner from Defense and Jose Antonio García Belaunde from Foreign Affairs, at least one of them should be in the position to explain to the president the playing field where he committed this blunder.

When asked by someone for Peru’s position on the Bank of the South, the President of the Central Reserve Bank (BCR), who was Peru’s representative for the Latin American Reserve Fund (FLAR) until taking over the BCR, responded along the lines of, What is that? Does it even exist? Considering that Europe is the model for regional financial integration, which Solchaga came to explain, with a convergence fund for areas of relatively lesser development, a stabilization fund that has become a central bank, a monetary unit which has become its currency, and an European development bank created in order to rebuild Eastern Europe, the question reflected not just ignorance, but rather bad faith towards regional integration schemes, of which FLAR has been an important component within Latin America for more than a decade.

It’s possible that the Foreign Affairs Ministry hasn’t informed the President about what took place at Asean+3, about the Kyoto agreements announced in May of this year and the creation of a free trade area from China to Indonesia including Korea and Japan, which addresses the movement of people, capital, services and transportation. It’s also possible that the Central Bank hasn’t informed the President that the International Monetary Fund (IMF) lost 90% of its loan portfolio between 2003 and 2006, and the World Bank 40%, as a result of what’s understood as adjustment fatigue.

Doesn\'t Peru have a government? A spontaneous president who doesn’t have a grasp of international factors not only fails to benefit neighboring countries, but also hurts his own people. Peru has made the world see that it doesn’t have a plan for international negotiation, that it doesn’t believe in regional integration, and that it only understands integration through trade. The Asian trend, the changes in the balance of power and a Europe made up of 27 countries don’t come to mind for a president who’s requesting bilateral relations with the European Union. Wouldn’t the protection of the Amazon - the lungs of the planet - be a theme of South American integration?

The Pacific Arc group, Washington’s idea without a doubt, which includes Peru, Colombia and Mexico, along with Central America as a counterbalance to South America, has two problems. First, it appears that Colombia is now in South America. The second is that Calderón and Mexico are being badly mistreated by Washington while the inevitable recession within the US economy has the Mexican government terrified. Its turn toward South America is a result of this, along with US anti-immigrant policy and its 1,300 km wall along the border. Although, for the moment, South America is mainly exporting cocaine to Mexico through Colombian, as well as Peruvian ports.

Mexico would like to diversify its markets in South America. The Southern Arc group is a narcoticized arc, made up of cocaine producing and cocaine trafficking countries. Is that the group where Peru wants to be? If Washington has put it there, that is one thing, but to put itself within that framework is stupid. García should speak with Lula and Ms. Fernandez and with Ms. Bachelet as well, in order to understand how the global game works, given that he’s now unwilling to converse with his own ministers, let alone Correa or Morales. The world of the 21st century is not the same as that of the 80s and it seems that no one has let him know. Meanwhile, the Andes are going to be left without snow and the conversations within CAN (Community of Andean Nations) will continue without Peru. García is to integration, as he was to debt in the 80s. He forgets that international relations are not a matter of ideology but of real politik, which requires a team, information and expertise. The populations of five Andean countries are hoping for shared negotiations with the European Union and the European Union is hoping for the same.

- Oscar Ugarteche is a Peruvian economist who works in the Institute for Economic Research at UNAM, Mexico. He is president of ALAI and a member of the Latin American Network on Debt, Development and Rights (Latindadd).