Louis Proyect lnp3 at SPAMpanix.com
Sat Aug 21 07:19:08 MDT 1999

>La cuestion que estoy tratando de discutir es otra. Se refiere a la relacion
>concreta, politica, que una fuerza socialista revolucionaria de masas debe
>establecer con el ala nacional democratica del frente antiimperialista.
>Insisto en mi observacion anterior. Intentar derrocar a Garcia, en el
>momento en que este se enfrenta al Fondo Monetario Internacional, establece
>un eje latinoamericano contra la deuda externa y, sobre todo, cuando no se
>cuenta con la fuerza necesaria para hacerlo, lejos de convertir a ese
>movimiento en "la barrera real y definitiva contra el imperialismo" le hace
>jugar el papel de ala izquierda de la contrarrevolucion imperialista.
>Julio F.B.

Garcia's initial role in confronting the IMF was positive, but we have to
recognize that Peru has always been 2 countries. One is criollo and based
in Lima, the other is indigenous and lives in the highlands. While each
country has its own class divisions, as a whole the criollos regard the
descendants of the Incas as racially inferior and exploit them
economically. This radical bifurcation not only explains the willingness of
the highlands to go to war, but the ferocity with which it did.

The other thing that must be recognized is that Garcia simply lacked the
will to confront Wall Street when presented with an ultimatum. He was
crushed like Manley in Jamaica, who also was a leftish ally of the Cuban
revolution. When he finally wilted under the pressure from imperialism, he
offered the standard excuse that "there is no alternative". Even on the
philosophical basis of Aprismo, Garcia had failed.

Financial Times (London), January 24, 1989, Tuesday

Peru 'Must Face Up To Austerity'

Veronica Baruffati, Lima

Peru faces drastic austerity measures if it wants to restore relations with
the International
Monetary Fund and World Bank to gain access to fresh loans, President Alan
Garcia warned on
Sunday evening.

He said an IMF team would visit the country next week "to study the economy
and propose a much
tougher programme than the so-called economic packages we have been
having." He added: "It is
difficult to talk about the IMF, but, cost what it may, we have to salvage
the economy."

Peru has accumulated arrears of Dollars 6 bn on its foreign debt, and its
performance has rendered it
ineligible for World Bank or IMF funds.

The country has sought to mend fences with the multilateral institutions,
and President Garcia is
believed to have been in contact with Mr Arjun Sengupta, a special
representative of Mr Michel
Camdessus, the IMF managing director.

In a 10-minute television appearance on Sunday, Mr Carlos Rivas Davila,
Peru's Finance Minister,
reported on his recent trip to Washington, where he spoke to
representatives of the international
financial community.

He spelled out some of the terms which Peru would have to meet if it wanted
to negotiate fresh loans
which would include a symbolic payment of Dollars 30 m to the IMF as a
token of goodwill to repay
its debt.

This would involve a shock economic programme, the main objectives of which
would be to eliminate
all subsidies; the unification of the official exchange rate in line with
the parallel dollar rate, at present
almost triple the highest official rate; an end to the indexation of wages;
and the introduction of an
austerity programme aimed at eliminating the fiscal deficit which equalled
15 per cent of Gross
Domestic Product in 1988.

Louis Proyect

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