Friday, July 27, 2007

¡Perú! ¡Perú! ¡Perú!

Finally, Perú is on Kiva. There are now two MFIs active, that Kiva has had discussions with for a while: Finca Perú and Prisma Microfinanzas. They are active in the Ayacucho and greater Puno/Juliaca regions, respectively. All very exciting.

Let me add a quote from a posting I did on KivaFriends. It shows why it is important to support micro-entrepreneurs in the mountainous regions of Perú, especially in Ayacucho:

Ayacucho is a poor area, in the Peruvian Sierra (or Mountains). In the 1970s, a university professor called Abimael Guzman, who had until then be a member of the Peruvian Communist Party, split off from that movement and formed the Maoist leaning "Partido Comunista Peruano - Sendero Luminoso", widely known in the west as the Shining Path. Much is known about what followed: the Shining Path recruited (often by force) many foot soldiers, who often committed horrible crimes against humanity. To quote Theodore Dalrymple "The worst brutality I ever saw was that committed by Sendero Luminoso (Shining Path) in Peru, in the days when it seemed possible that it might come to power. If it had, I think its massacres would have dwarfed those of the Khmer Rouge. As a doctor, I am accustomed to unpleasant sights, but nothing prepared me for what I saw in Ayacucho, where Sendero first developed under the sway of a professor of philosophy, Abimael Guzman."

As a result of successful counter-insurgency in the 1990s, many of the Senderistas were captured and got sentenced to prison for various lengths of time. The top guerillas got life in prison (no parole), but many of the lower foot-soldiers got sentences that have made them eligible for parole for the last few years. And, maybe as a result and maybe not, you see in increase in left-wing guerrilla activities in the Ayacucho region. Why? There is not much for these ex-guerrillas to come home to. Poverty hasn't gotten any better in Ayacucho, and the lack of opportunity hasn't gotten much less either. This caused some to see falling back to old habits appears an attractive option.

In addition, a new kind of "nationalist" oriented socialism has emerged: that of Ollanta Humala and his Etno-Cacerist party. It's militarism / socialism combined with indigenous rights/obliteration of the ruling mestizo class, nationalism, close-border protectionism that culminates in an intense hatred against Chile for the loss of territory in a war in the 1800s. Note that Chile is one of the largest foreign investors in Perú, and the economic consequences of Chilean investors retreating from Perú would be huge. BTW-- Hugo Chavez, Venezuela's president, supported Humala's campaign for president in 2006. Humala narrowly lost in the second round against the current president, Allan Garcia. If he would have won, we wouldn't be doing loans to Perú right now...

What can we do? A lot! Microfinancing does a number of things for the people of Ayacucho:
  • it shows them that there is a way that capitalism works for them; it creates believe in the "system".
  • it creates opportunity to escape poverty, keep busy, and get ahead, which takes away any reason to sympathize with any left-over extremists
  • it creates safeguards to ensure that Sendero Lumino - style rebellions won't have a chance of resurging

Therefore, I think it's really important to actively support those loans from Perú, especially from Ayacucho, but also from other mountainous regions like Puno/Juliaca, Cuzco, etc. It's not that poverty is so much worse than in other places in the world, but the stakes of continuing this poverty could be so much higher than in other places in the world...

To remind us what terrorism in Perú does to people, please see this YouTube video: it contains scenes from a bombing of a residential building where my inlaws now own property. (They did not on this dreadful day in July 1992.)


Anonymous said...

Hola Ramon,

Yo vivo en Malaga, Espana, pero Soy de Escocia.

Estoy interesado a ayudar a traducir las experiencas de los clientes de Kiva.

No se si yo puedo hablar suficiente Espanaol a hacerlo, avisarme si puede.



Guillermo Perez said...


Ahora hay al menos 3 MFIS en Peru. Great!

A proposito tus emails no funcionan. Estaba tratando de contactarte y me rebotan los emails.

Un abrazo.
Guillermo Perez

ian said...

Thanks for the informative post and for actually replying to your readers’ comments. That’s something I don’t see very many blog owners doing and that makes me frustrated. Keep up the good work and I’ll continue coming back here to learn more....