Alan Garcia

Sam Pawlett rsp at
Thu Aug 26 00:22:13 MDT 1999

fajardos at wrote:

> Sam, what Louis said about Garcia's initial stance toward the IMF and
> the foreign debt as "progressive" is definitely true.  His proposal to
> freeze debt payments at maximum of 10% GDP struck a nerve all over Latin
> America at a time when the entire continent was mired in the worst
> economic crisis it had seen since the 19th century and at time when IMF
> emissaries were still virtual viceroys.

Yes, I agree. The problem is if only one country fudges on its debt,
Washington and the banks can  punish that particular country which is
what happened with Garcia. To be effective several countries must act
together to limit or better yet repudiate debt. Castro has or was urging
such an alliance for a long time.

> Garcia did in fact freeze debt payments at 10% of GDP, thus relieving
> some of the pressure on the economy, which grew in his government's
> first two years at something like 7% per annum.  What went quietly left
> unsaid most of the time was that that was on debts contracted by
> governments previous to his own.

Yes, the economy really took a nose dive towards the end of his
presidency-- the attempts to raise the purchasing power of the masses
ended in massive inflation--which only strenghtened the hand of the
neo-liberals and the PCP leading to the showdown early in Fujimori's

> The IMF and Washington were willing to swallow some of the medicine
> Garcia was kicking back at them probably because they could not afford
> to have any country default at that time, and because in order to keep
> Peru's credit existent Garcia paid as usual on debts contracted in his
> time.  Unfortunately there were many of those.

Washington was also afraid that other countries might follow Peru's

> After pocketing suspected millions in graft Garcia left Peru.  He
> currently resides in Venezuela, from where he tries to keep in the
> news.  He is considering a run for Congress in 2000, but Fujimori passed
> a law --known as the "Alan Garcia Law"-- which bans anyone who is under
> idictement for crimes from running for public office.  It so happens
> that Garcia is under idictment for misappropriation of funds, his role
> in the Bank of Credit and Commerce International (BCCI) scandal, and
> misuse of his post.  The Venezuelan government has refused to hand him
> over.  Two weeks ago he staged a press conference and basically called
> for a civilian-military front to oust Fujimori, with a coup if need be.

Interesting. Fujimori's Peru is very,very grim.

> The idea was not well received in Peru.

Really? If it was someone besides Garcia, the idea might be more
popular. 2 years ago the APRA people in Trujillo[office with that great
Rivera-style mural outside] told me that Fujimori ,after the auto-golpe,
put out warrants for many APRA leaders and organizers. F thought they
would be the main threat to his power.

I would note also that it was under Garcia when the counter-insurgency
campaigns grew more brutal and militaristic. The human rights org's
noted a drastic increase in abuses during the last years of G's
government. It was just a taste of what was to come.

I was told by many Peruvians that Garcia and the leaders of the
MRTA[forget the main leader's name--he's in jail in Peru, was a student
at the Sorbonne or some other French university] were close friends,
that the MRTA grew out of APRA gangs in the 60's&70's. True?

Sam Pawlett

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