Peruvian Perfect Storm: State Fragility, Corruption and Organized Crime1

Lucía Dammert2

Introduction The presence of organized crime has become the main threat for the Peruvian State’s security.

The weakness of state’s capacity at regional and local levels of government is indisputable and has not changed much in recent years. On the contrary, the process of decentralization is barely linked to strengthen their capabilities to fully respond to the countries many challenges.

However, it opened up a process of check and balances that showed the multiple difficulties of the presence of the state in the territory.

These processes go hand in hand with a crisis of legitimacy in the political arena, consolidated during the Fujimori government, whose principal elements are political party crisis, creation of multiple local movements with limited self-governing mechanisms, obscure financial strategies and high impunity surrounding major political corruption scandals.

Thus, the main threat to the Peruvian state is not linked with its destruction or an external intervention but rather to an internal deterioration that weakens its own structure. There is a clear difficulty to deal with this issue: lack of information. In fact most evidence raises from journalists and media investigations that often became the only whistleblower the illegal acts.

This chapter assumes a pending conceptual debate about organized crime and the diverse ways it could be understood. But beyond these challenges, it will intend to find clear signs of the complex relationship established between organized crime and a continuous process of institutional weakening in . The chapter is divided into four sections. The first one

1 A review version of this paper will be publish as a chapter in En Kassab, H. & J. Rosen (edits) Fragile States in the Americas. Lexington Books, Washington DC 2 Associate Proffesor, Universidad de Santiago de Chile.

1 emphasizes the characteristics of the institutional organization of the Peruvian State in all levels of government. The second section discusses organized crime in Peru, focusing in three illegal markets: drug trafficking, illegal mining, and human trafficking. It is only part of the problem, but they surely are the most representatives of the processes of consolidation of illegal networks and markets in Peru. The third section focuses on the clear and no so evident policy weaknesses and their links between political actors and illegal markets. Although much of the existence evidence is no conclusive, there are too many signs that depict an important protection of the political world by illegal actors.

Finally, the search for strategies to tackle this situation that could be labeled as the “Perfect

Storm” that is developing in Peru will be emphasized. Strategies that need political will, citizen involvement and institutional strength in order to be developed and implemented in a successful way. The presence of these elements has yet to be verified.

I. The Peruvian Institutional Context

The Peruvian State has gone through profound transformation processes in the last decades

(Gootenberg, 2013). The available information indicates the presence of significant positive results, which less than fifty years ago were considered to be even impossible. Health and education coverage have been the main policies developed that highlights state presence in many

Peruvian regions. Most of which wee used to having the military or the police force as only representatives of the state. While Peru is inherently centralized country, with a capital city such as Lima that holds more of 50% of the national population as well as economic and financial activities; it has a decentralized structure. In the last two decades the presence of democratically elected regional governments has consolidated, including a new local political actor in the regional map. New laws gave their regional governments key functions to develop and

2 implement policies as well as administrative management roles of their territories. Furthermore, they have important resources allocated from the national budget that allows them to develop an economic and social policy agenda.

Unfortunately, the real capacities of the regional and local governments are still very limited, mainly due to the low professionalization of human capital as well as the constant change of personnel. Not to mention that the decentralization process occurred during a period of economic boom that translated in a huge influx of money into regional governments. In Peru, regions receive 50% share of the income tax paid by mining and oil companies. That situation consolidated a new public investment panorama in which more than 2/3 of the national budget is carried out by subnational governments. The same institutions that, as mentioned before, lack professional structures and human capacities to tackle most managerial shores and duties describe as their regular missions.

This is not only a problem for regional governments but rather it reflects what occurs at national levels. The crisis of legitimacy and representation faced by political parties has been exacerbated since the mid-90s during the government of (1990-2000) but it does not comment solely from this period. Nevertheless, in the last decades the weakening of political action has been accompanied by the birth of smaller political parties with only electoral purposes, with few life spans, small number of militants with little commitment, and generally gathered through unclear mechanisms.

In this context two parallel processes developed, which tend to generate a vicious cycle where transparency, effectiveness of politics and strengthening of the public apparatus are not in the center of the agenda. However, the state is not weak in all areas. On the contrary, in the last decades we have seen important achievements linked to the Peruvian state, mainly, in its

3 macroeconomics policies that have affected the achievements of relevant developmental objectives (UUNN, 2015). For example, It has reduced the number of living below the poverty line, increased the levels of educational coverage, reduced the infant mortality rate and increased the coverage of basic services around the country (CEPAL, 2015).

The so-called first generation reforms managed to improve economic indicators and consolidate a more stable economy, but have undoubtedly shown their limitations. The importance of an agenda of second generation reforms in urgent, connected to institutional efforts to strengthening public administration and justice also improve quality of public education and health to name a few. In fact, the World Economic Forum, in its last report ranked Peru 135 of 140 in police services, 133 in high presence of organized crime, 130 in trust of the police force and quality of education systems, and 133 in labor rigidness (WEF, 2016). Moreover regarding corruption Peru faces many challenges and during 2015 dropped seven slots relative to the previous years (WEF,

2016). It is clear that a pro-institutional strengthening agenda is the principal challenge that the current as well as the forthcoming government have to deal with.

However, the challenging agenda is not solely the governments’ responsibility. Broad political consensus is the key in order to advance through long periods of complex reform that require executive action as well as legislative power. For instance, the criminal justice system (police force, justice system and prison system) have been abandoned for decades due to limited or bad investments that have empowered the development of internal circles of powers, whose objectives are linked to self-enrichment more than for the strengthening of institutions.

The changes required at the institutional level are manifold, however the goal of the present chapter is to describe the connection between increasing levels of the vulnerabilities of the State, organized crime threats, and corruption practices. In this exercise, criminal justice system

4 institutions are the center of the agenda due to their ability to monopolize the use of force; the delivery of justice and the use of punishment mechanisms and rehabilitation for those who violate the laws.

The scenario is quite dramatic. The (PNP for its Spanish name) is a centralized institution that has suffered many attempts at reforms during the last decades; most of them have been unsuccessful (Costa y Basombrio 2008). The limited professionalism of their forces, the inefficient civil controls related to its actions and even the use of punitive populism discourses in vogue in Peru and the precarious salary conditions and social protection of the police officers are different elements used to built an ineffective institution with low citizens trust. In fact, the Peruvians have a profound negative perception of the institution in charge of the control and prevention of delinquency due to inefficiencies, corruption, and excessive use of force.

The justice system has not gone through a better path. On the contrary, it is the worse evaluated institution in Peru and multiple cases involving political corruption such as organized crime have continued eroding its legitimacy. The sentiment in Peru is that the law is not applied equally to all and that money appears to be the only way to buy or gain inside influence over the internal justice system. The effort to reform the procedural penal process that was designed to increase effectiveness of judicial procedures as well as to improve investigative capabilities of the police ant to protect the victims, have not had clear effects yet.

Finally, the penitentiary system is crippled and relies on punishment more than rehabilitation

Peruvian jails are filled with people awaiting trial, most of them charged with sexual offenses, crimes against property, and micro-trafficking of drugs (Dammert & Dammert, 2015). Public investment in these institutions has increased in recent years, but lack of structural reforms that

5 reinforce the process of professionalization has not really made significant changes. The situation inside the country is much more complex due to the lack of civil society´s control mechanisms, the presence of “volatile” political parties, and the rising of a culture of illegality among the population (Levitsky & Cameron, 2003). All elements that don’t help to build up an agenda of institutional changes, in fact it is quite the opposite. In other words, the terrain is fertile for the development of illegal activities at all levels of government given that the perception of impunity has penetrated the very fabric of society.

II. Organized Crime and Violence

Organized crime is a polysemic concept that has been used to describe several societal situations and problems. Its characterization could be summarized in two contradictory options: (i) a group of stable organizations whose members are systematically linked to crimes, and (ii) a group of criminal activities mostly carried out for monetary interest (Paoli & Van der Beken, 2014, 14).

While there are theoretical approaches to organized crime that often compete with each other, it is worth highlighting five that in the Peruvian case have been used frequently for its analysis

(Paoli & Van der Beken, 2014). The most common approach is the one who blames an external actor with the idea that the problem comes from external groups who enter the country as a cause of internal institutional weaknesses. In this case the presence of Colombians in the amazon area and the administration of production and transfer of cocaine is just one example. The second approach is the bureaucratic model, which places emphasis on the way in which these institutions are organized, generally pyramidal with clear hierarchy and division of tasks. Those qualities of the organizations were traditionally found among drug trafficking organizations but are also present in the areas illegal mining as well as in human trafficking. Thirdly, from the

6 point of view of illegal enterprises, importance is placed on the link between illegal and legal activities; clearly defining a thin line that divides the two activities. Although this analytical perspective has been less used in Peru, there are several and constant signs of collaboration and integration of some areas of the illegal and legal markets.

The territorial protection-centered theory takes the experience of the Italian mafia is the forth approach that emphasizes the weakness of the State in countering organized crime groups. The main consequence of the conflict between the state and criminal organizations is not increasing rates of homicides or violent clashes. Rather, increasing levels of corruption have in fact put governmental capacities practically “on sale”.

Finally, the importance of social capital and criminal networks is central to this approach which questions the strong presence of hierarchy and recognizes that while the links between the members can be broken, the chain can be easily repaired, which is apparent in the studies of sicarios (hit-men) and their role managing conflict at the local level, particularly in the drug- trafficking market.

In Peru, the presence of organized crime was not recognized as a problem until the late 1980’s.

In fact, throughout the beginning of the decade greater emphasis was placed on the transnational component of the problem. In other words, drug trafficking was assumed as an external issue mainly linked to Colombian cartels. The culture of informality and illegality has become a mechanism for developing all types of entrepreneurship in the country. Moreover, there is a clear upward trend of crime and violence in the last decades (Bagley & Rosen, 2015), which has led to the consolidation of fertile grounds for the presence of multiple illegal markets that developed by way of using and redefining several spaces of the State’s apparatus.

7 Since the 1980’s crimes against properties and against people, especially assaults that occur in public spaces have increased substantially due to the presence of risk factors known by the literature as triggers of criminal careers (Dammert, 2012). The political response has been weak, dismantled and centralized around police responses designed to tackle small offenders, which in turn filled jails and detention centers without real capacity to face addiction problems, violence or mental illnesses. The system became a “graduate school of crime” where those that had been detained for misdemeanors formed associations and links with more serious criminals to develop more violent criminal activities.

This process explains the development of organizations dedicated to criminal activities that need an ample base of people available to perform the tasks that require less preparation and generally involve more risk. At the base of the pyramid of the majority of these illegal activities there are thousands of children and youngsters whose only way to survive is to participate in activities that would clearly lower their life expectancy. Another element of the situation in Peru is strongly linked with the historic presence of cocaine trade. Although this illegal market does not have the violent consequences that can be seen in countries such as Mexico or El Salvador, in Peru it uses corruption as its main tool to consolidate its business. And unfortunately, it has succeeded.

The war on drugs in Colombia had several consequences in Peru. While law enforcement was consolidated to fight criminal organizations and investment in technology and human skills to better control cartels increased in Colombia, in Peru the situation varied widely. The increasing presence of criminal groups with more flexible and complex forms of organization and a clear market oriented strategies was evident in many Peruvian cities.

8 In 2013, Law 30077 was approved and defines a criminal organization as “any group other of the three or more people that shared diverse tasks or functions, in whatever structure, and action areas, which, on a stable basis or indefinitely, is formed, exists or works, reliably and directly, in a concerted manner, with the aim of committing one or more designated felonies in chapter 3 of the present Law. The offences referenced involve; homicide – murder; kidnapping; trafficking of persons; invasion of the secrecy of communications; crimes against property; child pornography; extortion; usurpation; computer crimes; crimes against industrial property; monetary crimes; regarding the transportation/possession, manufacturing and trafficking weapons, ammunition and explosives; public health offenses; trafficking of illegal drugs; migrant; environment crimes; crimes of marking and adjusting; genocide, forced disappearance and torture; crimes against a public administration; falsification of documents and laundering assets. The law includes an ample list of criminal activities, which have stronger punishments and can be investigated by specialized police units. But the creation of legal tools is only a small step toward an effective policy, which also needs transparent and effective institutions to control the many markets where illegal activities are developed. Also, clear information that would allow for specific police strategies is needed in order to strengthen police effectiveness. The interest of the United Nations and other international organizations can become a double-edged sword in addressing the problem due to the fact that it turns into a subject that involves will and actions of multiple actors that exceed the actions of a specific government (Pires, et al. 2015)

The following section presents an analysis of the main security challenges that Peru is facing along public policies responses designed and implemented recently.

II.1 Drug Trafficking

9 There is a long tradition of drug production in Peru. Although the literature is scarce and based mainly on anecdotal information, different sources place the beginning of this illegal market during the first half of the 1970s in the area of Alto Huallaga (northern part of Amazon) which by mid-90s covered more than 200,000 hectares. At that stage the illegal activities were completely managed by the Colombian Medellin and Cali cartels that used Peruvians as intermediaries in an illegal market that was perfectly controlled3.

The infiltration of drug trafficking in public institutions is reflected by the regular use of state owned aircraft for the transportation of the cocaine to Colombia. In some notorious drug cases, flights were protected by the military or the police. Paradoxically, the location of many clandestine airports was a short distance to the main counter-subversive bases of the army especially in the Amazon area.

With the dismantling of cartels a new method for drug trafficking arise in Colombia. It centered on the presence of small, flexible, and dynamic organizations with ties to legal activities that in turn allow them to launder dirty money in a regular basis. Alongside, in Peru an increase in the presence of Mexican cartels was evident4. Peru became the first producer of coca and cocaine in the world (UNODC, 2015). This change in the “administration” of the market has brought some changes inside Peru due to the increase of small domestic groups that produce cocaine and supply other organization that have control of the main ports in the Pacific. At the time the main mechanism to ensure commercial success continuous to be bribery, specially to military

3 There are several webs that present relevant information on this issue such as http://www.drugpolicy.org/drug- trafficking-latin-america and http://www.insightcrime.org/peru-organized-crime-news/peru 4 http://www.jornada.unam.mx/2008/06/10/index.php?section=politica&article=012n1pol

10 authorities, police forces, and the judiciary as well as customs authorities and other public and private institutions.

What in other countries is paid for with violence, in Peru it is literally paid with money.

Currently, the areas of Apurimac and Ene Valleys (VRAEM by its Spanish acronym)- the main producers of cocaine in the country – also contain the largest police and military forces dedicated to the fight against drugs. One explication for the lack of clear results could be the absence of effective strategies or the limited institutional capacity to fight against a large variety of small associations of cocaine producers. The other interpretation is much simpler: institutional corruption. It is possible that neither of the two will fully explain the phenomenon but all the evidence tends to show important levels of penetration of drug trafficking inside several public institutions working in the area. Money is clearly not a problem, in fact a recent research estimated that gross profits of organized crime groups operating in South America, selling drugs to local markets as well as to overseas markets rise to some US$18 billion (UNODC, 2011).

The situation seems to have not changed significantly. In fact, several investigations into the actions of one of the major drug lords of Peru who was recently released from prison and later on detained in Colombia, provided clear evidence of the complicity of some military officials in exchange for bribes to infiltrate drugs in flights that transported personnel. According to press releases the prosecution acknowledged that subsequent to its institutional aircraft transport, “the cocaine was later packaged for exportation and infiltrated in the port terminals of el Callao, who administrated the companies World Callao”5.

5 Acusación fiscal contra “Caracol” y sus cómplices. La Republica, 2016

11 Peru is not longer considered a transit country for drugs. In fact, the consumption of drugs has steadily increased in the last decades. Lately, the main acts of violence, especially homicides, are apparently linked to a continuous fight for the internal market that is becoming more lucrative everyday. According to CEDRO (public institution in charge of policies to tackle drug consumption) the prevalence of consumption of cocaine affected more than 264,000 people in

2013 and crack more than 357,000 people6.

Public responses to counter drug trafficking are limited to international aid, most of which aim to destroy coca cultivation areas and to polices strategies to imprison of small groups in charge of local distribution of drugs. The results are scant and do not show significant impacts on the presence of those criminal organizations in the country. On the contrary, criminal presence has decentralized and has branches in almost all Peruvian cities. This is not a unique carter with traditional hierarchic structure but a multiplicity of small and flexible groups in specific territorial location. If public responses to drug trafficking are limited, initiatives to tackle drug consumption are not even in the agenda.

II.2 Illegal mining

Peru is a mining country. The exploitation of mineral resources has been fundamental part of the economic development of the country since the beginning of the Republic and throughout history informal exploitation of mineral resources has also played an important role. In fact, Peru is the second largest global producer of silver, the second largest known cooper reserve in the world and the sixth largest producer of gold. For many years families, who obtained the right to operate in a specific territory by the local government, carried out the exploitation of multiple gold areas.

6 http://www.cedro.org.pe/#133

12 This practice still exists today and brings together a large number of people in regions with especially high concentrations of precious metals. That traditional way to exploit natural resources is an element of the problems that property rights face in Peru, which are mainly weak and ill defined in many territories (Thoumi, 2010).

However, informal does not mean illegal. While both phenomena are often confused, in recent decades, illegal mining has become a highly complex phenomena linked with intense use of violence, human exploitation, human trafficking, and the participation of actors associated with the drug market. Illegal mining is not synonymous with semi-manual or mechanical work. On the contrary, it is organized in hard to reach places where the State has little to no presence or control. In most cases illegal miners utilize heavy machinery and an intricate web of local and national that allow them to evade control and move forward with environmental degradation with social and health consequences in nearby towns.

In the last decade gold has become the main target of illegal miners especially in Madre de Dios

(Amazonian region), which produces eight percent of gold globally and allegedly 70 percent of

Peru´s illicit gold production (Swenson, 2011; Gardner, 2012). It is estimated that this activity itself has destroyed over 50,000 hectares of the Amazon (Ministry of the Environment, 2016).

Furthermore, a research by the Carnegie Institute demonstrated that 60% of the fish consumed in

Puerto Maldonado (capital of Madre de Dios) have higher levels of mercury than the limits allowed by the World Health Organization and, in turn, 78% percent of adults evaluated were reported to have mercury level that are three times higher than the maximum permitted limits

(Carnegie Institute 2013).

13 The illegal market is strong and the state capacity to deal with it is limited. In relation to the production of gold, for example, reported and exported production in 2014 was 140 tons and

165.6 tons respectively. More than 25 tons of gold were legally exported without any state information of its precedence. This gap has continued to increase along with the rise in prices of precious metals (Torres, 2015). It is estimated that the total tons of unreported production between 2003 and 2014 exceeds 15,777 million US dollars with profits of illegal mining exceeding the billions. Funding that has been used to consolidate an illegal market that forges strong links between the legal activity and corruption of many actors in the production chain.

Most of them located in public institutions but also in the private sector.

II.3 Human Trafficking

Linked with the drug market and illegal mining, but also with the increase presence of prostitution within many cities in Peru, human trafficking has become a security threat especially for the most vulnerable. Available information shows a troublesome picture that involves a continuous process of violence against women and children. In fact the literature emphasized that violence against women, in the private and public spaces, whether perpetrated by the State or the intimate partners has still not been adequately addressed (Boesten, 2010).

Contrary to common believe, this is a national problem with more than 81% of victims being of

Peruvian origin in 20147. In the cases of transnational human trafficking organizations, the main victims are women from neighborhoring countries such as Bolivia, Colombia and Brazil

(UNODC, 2012). While this crime faces harsh punishments starting with a minimum eight-year prison sentence; market incentives appear to be tempting.

7 http://elcomercio.pe/lima/ciudad/trata-personas-peru-delito-invisible-informe-noticia-1835074

14 In the period between 2009 and 2014, police institutions received 2241 complaints, which undoubtedly hide a giant number of unrecorded crimes, which go unrecognized by the judicial system. The majorities of these complaints were primarily concentrated in the Amazonian region, as well as in Lima, and are linked with labor and sexual exploitation. In 2014 it was estimated that 90% of victims were women and 60% of them were children, which paints a dark panorama of the processes of violence and abuse to which they are subjected (Ministerio

Publico, 2016).

The porousness of the border, institutional corruption, and links with drug markets and illegal mining are some possible explanations for the presence and magnitude of this problem. In recent years, Peru has become a corridor for the movement of people, especially women from

Colombia, Haiti and Dominican Republic in their way to other Latin American countries.

Unfortunately in Peru policies to effectively tackle this problems are limited. In fact, the government does not fully comply with the minimum standards to eliminate this problem and there are no specialized institutions to protect victims.

Cultural changes are also needed in order to understand gender violence as a crime. In a country with a conservative male chauvinist society, most violence against women goes unpunished.

Even in cases of sexual exploitation of minors and in some cases with the help of the police that does not control these activities and in some cases it is part of the abusers.

III. Politics and Organized Crime

“Do not give away your vote to candidates with criminal records” declared President Ollanta

Humana in October of 2014 in regard to the regional presidential and local level government

15 elections. At the time more than 2 thousand candidates had served time for committing various unlawful acts and more than 750 candidates have convictions for violent crimes. What further complicates the information provided by the National Jury of Elections (the body responsible for electoral processes in Peru) was the fact that 124 candidates during that election process were being investigated or had been convicted of ties to drug trafficking.

Unfortunately, that situation does not present a unique moment in Peruvian political history but rather a tendency that has positioned itself throughout the recent decades. Previously, many candidates have criminal records especially at the regional and local level. In the 2010 elections, more than 670 candidates had criminal backgrounds and more than half of them belonged to regional political movements that had a short history and almost no political tradition, most of them aiming to that single election process.

The corruption associated with the central state apparatus that characterized the previous century has expanded and decentralized. As mentioned above, the process of decentralization delivered important decision-making capabilities especially at the regional level, which granted a more relevant role for officials that previously lacked those capacities. This situation created an unprecedented phenomenon during 2010 to 2014, in which massive cases of corruption were uncovered regarding the procurement and contracting of public goods in nineteen of the twenty- five regions (Figueroa, 2015).

Political corruption is not a new concept in Peru. On the contrary, many historical analyses emphasize a constant practice linked with corruption among the political classes since the beginning of the Republic (Quiroz, 2008). Nevertheless, many scholars have noted that an authoritarian government that intervened in the powers of the judiciary and shutdown the

16 Legislature in 1992 violated the institutionalism of the Peruvian state. Thus, President Fujimori and his main advisor, Vladimiro Montesinos, consolidated a state structure with strong links to criminal activities that emphasized corruption as a political tool at every level of government.

The results of this process were catastrophic for the defense of the institutionalism of the state.

During this period the stated was often branded as an obstacle to development, which resulted in a citizens´ negative perception and support for structural changes without greater control. The replacement of qualified staff and dismissal of professionals from various state entities was massive during the first wave of reforms, which allowed the executive to have control over decisions in general. Toward the end of the decade the web of manipulation and corruption, built by Fujimori and Montesinos, which included members of the armed forces, the national and international business community, judges, congressman and representatives of the national and regional level governments was uncovered. Referred to as “vladivideos,” these records are tangible proof of the acts of corruption that occurred during the regime in order to buy laws, wills, business, and, of course, conduct illicit acts for personal enrichment.

In order to achieve his objectives, Fujimori also penetrated the armed forces and the police. Also consolidated an informal civilian armed group that developed activities clearly in violation of human rights against those not participating it the plans and goals of the new “mafia state”.

Currently former President Fujimori is serving a twenty-five-year prison sentence for counts of corruption and violation of human rights and the personal misappropriation of over an estimated six billion dollars. Montesinos is also serving time in jail and he faces more than 63 counts of corruption, drug and arms trafficking, and violations of human rights.

17 After Fujimori, Peruvian´s cynicism about politicians has skyrocketed. In 2014 an opinion poll showed that almost half of those asked said that they believe that is Luis Castañeda was elected

Lima´s mayor he would “steal but would do public works”8. Castañeda later on won the most important local government in the country: the administration of its capital Lima. The population perceives the situation with clarity and, according to multiple sources; the problem of corruption has positioned itself amongst one of the most pressing issues. Even more, data from the 2014

Americas Barometer show that 26.4% of the population reported having been a victim of acts of corruption and more than 90% of respondents believe that crime has somewhat or fully become the norm among public officials9.

The illicit activity in political financing as well as the its link with serious facts without clear just results have generated a sense of impunity among the population that is no longer surprised by daily newspaper allegations regarding the subject. In the most recent 2016 presidential elections, candidate Alan García, twice , obtained a little over five percent of the vote. A situation attributed to the well-known 2015 “narcoindultos scandal” in which it was found that

Garcia had been part of a strategy to deliver over a thousand pardons to persons convicted of aggravated drug trafficking – those in possession of more than ten kilos of cocaine or were members of criminal gangs. More than fourteen officials who worked on the commission overseeing pardons have provided statements showing clear links between senior government officials, the delivering of money, and the purchase of wills by leaders of drug trafficking cartels.

8 http://peru21.pe/opinion/roba-hace-obra-2198811 9 AmericasBarometer (2015) Latin American Public Opinion Project (LAPOP), www.LapopSurveys.org.

18 Not all scandals generate citizen reaction. The in the same 2016 election, Kenji Fujimori (son of the former President) ran for Congressional reelection and obtained the first national majority despite the fact that in 2013, one hundred kilos of cocaine were found in a Callao port warehouse belonging to him. The congressman blamed the company that leased the warehouse and later the investigation was deemed inconclusive and was closed.

The cases are many but all have essentially the same result: few sentences, short-term media scandals, and limited electoral punishment even for those found guilty of clear acts of corruption.

A congressional report into the influence of drug trafficking on politics was published in

November 2015 with clear evidence on how drug trafficking interests have sought to manipulate political parties10. The report highlights the presence of a dense network of legal businesses that provide them with cover and routes to facilitate money laundering. The report was never debated in Congress and received little media attention. Later on many of those running for congress with clear links to legal and illegal businesses got elected.

IV. How to deal with “The Perfect Storm”?

The Peruvian state implemented important modernization processes in specific areas associated specifically with macroeconomic stability, tax collection, international investment, as well as an improvement in the quality of social policies in relevant areas such as education and health. The majority of these transformational processes is concentrated in state capacity within the capital of the country and only slowly reaches the interior of the country. Thus, some areas of the state

10 The report is not available. But most peruvian media presented information regarding its most important results. http://elcomercio.pe/politica/congreso/congreso-aprobo-informe-final-comision-narcopolitica-noticia-1862693

19 became examples of the possibility of transformation while the rest of the state apparatus has low real capacity for modernization in the short term.

Thus one cannot label Peru as a national fragile state but it is possible to claim that practically all of the regional government and districts deal with high levels of fragility. The threats are not external but rather they are linked to a process of erosion of the very pillars of the rule of law and state presence by the penetration of organized crime in its many facets. This chapter has provided an overview of some situations that demonstrate with certainty the deterioration of the political arena, the increasing power of illegal money and the constant development of corrupt practices.

Especially complex is the situation in the areas of the Peruvian Amazon – an area with the worst indicators of poverty and indigence where the greatest challenges lie in regard to social policy.

Regional political movements are also concentrated in this area and are often financed through opaque means or directly affiliated with illegal activities.

For now, the penetration of organized crime in Peru has not brought about a significant increase in the violent homicide, which is assumed to associated with the actual ability to “purchase” political will that allows for this type of criminal activity to occur. At some point, this precarious equilibrium will break and the “settling of scores”, clashes over territory and the formation of protection groups will increase. Today, the state is not prepared to face an increase in violence. It has weak capacity to investigate, control and prevent violence, meanwhile justice systems function with little effectiveness.

This is how the perfect storm is forming and it appears than many prefer to focus on the good national results of economic growth and investments in mining. Neglect, inability, or simply

20 irresponsibility may be some of hypotheses in the interpretation of the phenomenon. A more complex hypothesis involves the recognition that even the highest echelons of power are part of informal or illegal schemes that openly allow the development of criminal organizations. The answer lies in between both hypotheses and requires more academic research as well as political action in order to face these issues. Without actions the results of a perfect storm are always linked to high levels of natural and human devastation, and in this case should not be different.

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