Peru (10/02)

For the most current version of this Note, see Background Notes A-Z.


Republic of Peru

Area: 1.28 million sq. km. (496,225 sq. mi.); three times larger than California.
Cities: Capital--Lima/Callao metropolitan area (pop. 8.27 million, 2000). Other cities--Arequipa, Chiclayo, Cuzco, Huancayo, Truujillo, Ayacucho, Piura, Iquitos, Chimbote.
Terrain: Western coastal plains, central rugged mountains (Andes), eastern lowlands with tropical forests.
Climate: Coastal area, arid and mild; Andes, temperate to frigid; eastern lowlands, tropically warm and humid.

Nationality: Noun and adjective--Peruvian(s).
Population (2000 est.): 25.7 million (72.3 % urban).
Annual growth rate (2000 est.): 1.7%.
Ethnic groups: Indian 45%. Mestizo 37%. White 15%. Black, Japanese, Chinese, and other 3%.
Religion: Roman Catholic (89%).
Languages: Spanish (official), Quechua (official), Aymara and a large number of minor Amazonian languages.
Education: Years compulsory--11. Literacy--about 87.5%.
Health (2000): Infant mortality rate--37/1,000. Life expectancy--67 male; 72 female.
Employed work force (1999, 7.2 million): Manufacturing--12.6%; commerce--27.8%; agriculture--8.4%; mining--0.6%; construction--4.4%; hotels & restaurants 7.8%; transportation & communications 8.4%; other services 29.1% (including government).

Type: Constitutional republic.
Independence: 1821.
Constitution: December 1993.
Branches: Executive--president, two vice presidents, Council of Ministers. Legislative--unicameral Congress. Judicial--Supreme Court and lower courts, Tribunal of Constitutional Guarantees.
Administrative subdivisions: 12 regions, 24 departments, 1 constitutional province.
Political parties and movements: Peru Possible, National Unity, We Are Peru, Change 90/New Majority/Let's Go Neighbor/People's Solution, Union For Peru (UPF), American Popular Revolutionary Alliance (APRA), Independent Moralizing Front (FIM), Popular Christian Party (PPC), Popular Action (AP).
Suffrage: Universal over 18; compulsory until age 70 (members of the military may not vote).

Flag: Peru flag

Economy (2001)
GDP (est.): $54 billion.
Annual growth rate: 0.2%.
Per capita GDP: $2,071
Inflation rate: -0.1%.
Natural resources: Minerals, metals, fish, petroleum, natural gas, and forests.
Agriculture (9% of GDP): Products--sugar, potatoes, rice, yellow corn, cotton, coffee, poultry, beef, milk.
Manufacturing (15% of GDP): Types--fish meal, nonferrous metals, steel, textiles, chemicals, wood, nonmetallic minerals, cement, paper.
Trade: 14% of GDP; other services: 51% of GDP. Exports--$7.1 billion: gold, copper, fishmeal, textiles, zinc, lead, coffee, petroleum products. Major markets--U.S. (25%), U.K. (13%), Latin America and the Caribbean 18%, Switzerland (4%), Japan (7%) Germany (3%). Imports--$7.2 billion: machinery and parts, cereals, chemicals, pharmaceuticals, crude oil and petroleum products, mining equipment, household appliances and automobiles. Major suppliers--U.S. (30%), Latin America and the Caribbean (31%), Europe (22%), and Japan (3%).

Most Peruvians are "mestizo," a term that usually refers to a mixture of Amerindians and Peruvians of European descent. Peruvians of European descent make up about 15% of the population; there also are smaller numbers of persons of African, Japanese, and Chinese descent. In the past decade, Peruvians of Asian heritage have made significant advancements in business and political fields; a past president, several past cabinet members, and several members of the Peruvian congress are of Japanese or Chinese descent. Socioeconomic and cultural indicators are increasingly important as identifiers. For example, Peruvians of Amerindian descent who have adopted aspects of Hispanic culture also are considered "mestizo." With economic development, access to education, intermarriage, and largescale migration from rural to urban areas, a more homogeneous national culture is developing, mainly along the relatively more prosperous coast.

Peru has two official languages--Spanish and the foremost indigenous language, Quechua. Spanish is used by the government and the media and in education and commerce. Amerindians who live in the Andean highlands speak Quechua and Aymara and are ethnically distinct from the diverse indigenous groups who live on the eastern side of the Andes and in the tropical lowlands adjacent to the Amazon basin.

Peru's distinct geographical regions are mirrored in a socioeconomic divide between the coast's mestizo-Hispanic culture and the more diverse, traditional Andean cultures of the mountains and highlands. The indigenous populations east of the Andes speak various languages and dialects. Some of these groups still adhere to traditional customs, while others have been almost completely assimilated into the mestizo-Hispanic culture.

Under the 1993 constitution, primary education is free and compulsory. The system is highly centralized, with the Ministry of Education appointing all public school teachers. Eighty-three percent of Peru's students attend public schools at all levels.

School enrollment has been rising sharply for years, due to a widening educational effort by the government and a growing school-age population. The illiteracy rate is estimated at 12.5% (17.4% for women), 28.0% in rural areas and 5.6% in urban areas. Elementary and secondary school enrollment is about 7.7 million. Peru's 74 universities (1999), 39% public and 61% private institutions, enrolled about 322,000 students in 1999.

The relationship between Hispanic and Indian cultures has shaped the face of Peru. During pre-Columbian times, Peru was one of the major centers of artistic expression in America, where pre-Inca cultures, such as Chavin, Paracas, Wari, Nazca, Chimu, and Tiahuanaco developed high-quality pottery, textiles, jewelry, and sculpture. Drawing upon earlier cultures, the Incas continued to maintain these crafts but made even more impressive achievements in architecture. The mountain town of Machu Picchu and the buildings at Cuzco are excellent examples of Inca architectural design.

Peru has passed through various intellectual stages--from colonial Hispanic culture to European Romanticism after independence. The early 20th century brought "indigenismo," expressed in a new awareness of Indian culture. Since World War II, Peruvian writers, artists, and intellectuals have participated in worldwide intellectual and artistic movements, drawing especially on U.S. and European trends.

During the colonial period, Spanish baroque fused with the rich Inca tradition to produce mestizo or creole art. The Cuzco school of largely anonymous Indian artists followed the Spanish baroque tradition with influence from the Italian, Flemish, and French schools. Painter Francisco Fierro made a distinctive contribution to this school with his portrayals of typical events, manners, and customs of mid-19th-century Peru. Francisco Lazo, forerunner of the indigenous school of painters, also achieved fame for his portraits. Peru's 20th-century art is known for its extraordinary variety of styles and stunning originality.

In the decade after 1932, the "indigenous school" of painting headed by Jose Sabogal dominated the cultural scene in Peru. A subsequent reaction among Peruvian artists led to the beginning of modern Peruvian painting. Sabogal's resignation as director of the National School of Arts in 1943 coincided with the return of several Peruvian painters from Europe who revitalized "universal" and international styles of painting in Peru. During the 1960s, Fernando de Szyszlo, an internationally recognized Peruvian artist, became the main advocate for abstract painting and pushed Peruvian art toward modernism. Peru remains an art-producing center with painters such as Gerardo Chavez, Alberto Quintanilla, and Jose Carlos Ramos, along with sculptor Victor Delfin, gaining international stature. Promising young artists continue to develop now that Peru's economy allows more promotion of the arts.

When the Spanish landed in 1531, Peru's territory was the nucleus of the highly developed Inca civilization. Centered at Cuzco, the Inca Empire extended over a vast region from northern Ecuador to central Chile. In search of Inca wealth, the Spanish explorer Francisco Pizarro, who arrived in the territory after the Incas had fought a debilitating civil war, conquered the weakened people. The Spanish had captured the Incan capital at Cuzco by 1533 and consolidated their control by 1542. Gold and silver from the Andes enriched the conquerors, and Peru became the principal source of Spanish wealth and power in South America.

Pizarro founded Lima in 1535. The viceroyalty established at Lima in 1542 initially had jurisdiction over all of South America except Portuguese Brazil. By the time of the wars of independence (1820-24), Lima had become the most distinguished and aristocratic colonial capital and the chief Spanish stronghold in America.

Peru's independence movement was led by Jose de San Martin of Argentina and Simon Bolivar of Venezuela. San Martin proclaimed Peruvian independence from Spain on July 28, 1821. Emancipation was completed in December 1824, when Gen. Antonio Jose de Sucre defeated the Spanish troops at Ayacucho, ending Spanish rule in South America. Spain made futile attempts to regain its former colonies, but in 1879 it finally recognized Peru's independence.

After independence, Peru and its neighbors engaged in intermittent territorial disputes. Chile's victory over Peru and Bolivia in the War of the Pacific (1879-83) resulted in a territorial settlement. Following a clash between Peru and Ecuador in 1941, the Rio Protocol--of which the United States is one of four guarantors--sought to establish the boundary between the two countries. Continuing boundary disagreement led to brief armed conflicts in early 1981 and early 1995, but in 1998 the Governments of Peru and Ecuador signed a historic peace treaty and demarcated the border. In late 1999, the Governments of Peru and Chile likewise finally implemented the last outstanding article of their 1929 border agreement.

The military has been prominent in Peruvian history. Coups have repeatedly interrupted civilian constitutional government. The most recent period of military rule (1968-80) began when Gen. Juan Velasco Alvarado overthrew elected President Fernando Belaunde Terry of the Popular Action Party (AP). As part of what has been called the "first phase" of the military government's nationalist program, Velasco undertook an extensive agrarian reform program and nationalized the fish meal industry, some petroleum companies, and several banks and mining firms.

Because of Velasco's economic mismanagement and deteriorating health, he was replaced by Gen. Francisco Morales Bermudez Cerruti in 1975. Morales Bermudez moved the revolution into a more pragmatic "second phase," tempering the authoritarian abuses of the first phase and beginning the task of restoring the country's economy. Morales Bermudez presided over the return to civilian government in accordance with a new constitution drawn up in 1979. In the May 1980 elections, President Belaunde Terry was returned to office by an impressive plurality.

Nagging economic problems left over from the military government persisted, worsened by an occurrence of the "El Ni�o" weather phenomenon in 1982-83, which caused widespread flooding in some parts of the country, severe droughts in others, and decimated the schools of ocean fish that are one of the country's major resources. After a promising beginning, Belaunde's popularity eroded under the stress of inflation, economic hardship, and terrorism.

During the 1980s, cultivation of illicit coca was established in large areas on the eastern Andean slope. Rural terrorism by Sendero Luminoso (SL) and the Tupac Amaru Revolutionary Movement (MRTA) increased during this time and derived significant financial support from alliances with the narcotraffickers. In 1985, the American Popular Revolutionary Alliance (APRA) won the presidential election, bringing Alan Garcia Perez to office. The transfer of the presidency from Belaunde to Garcia on July 28, 1985, was Peru's first exchange of power from one democratically elected leader to another in 40 years.

Economic mismanagement by the Garcia administration led to hyperinflation from 1988 to 1990. Concerned about the economy, the increasing terrorist threat from Sendero Luminoso, and allegations of official corruption, voters chose a relatively unknown mathematician-turned-politician, Alberto Fujimori, as president in 1990. Fujimori implemented drastic orthodox measures that caused inflation to drop from 7,650% in 1990 to 139% in 1991. Faced with opposition to his reform efforts, Fujimori dissolved Congress in the "auto-coup" of April 4, 1992. He then revised the constitution; called new congressional elections; and implemented substantial economic reform, including privatization of numerous state-owned companies, creation of an investment-friendly climate, and sound management of the economy.

Fujimori's constitutionally questionable decision to seek a third term and subsequent tainted victory in June 2000 brought political and economic turmoil. A bribery scandal that broke just weeks after he took office in July forced Fujimori to call new elections in which he would not run. Fujimori fled the country and resigned from office in November 2000. He currently resides in his parents' native Japan, amid controversy regarding his involvement in corruption scandals and human rights violations during his tenure as President. A caretaker government presided over new presidential and congressional elections, held in April 2001, which observers considered to be free and fair. The new elected government, led by President Alejandro Toledo, took office July 28, 2001.

The president is popularly elected for a 5-year term, and the 1993 constitution permits one consecutive re-election. The first and second vice presidents also are popularly elected but have no constitutional functions unless the president is unable to discharge his duties. The principal executive body is the Council of Ministers, headed by a prime minister, all appointed by the president. All presidential decree laws or draft bills sent to Congress must be approved by the Council of Ministers.

The legislative branch consists of a unicameral Congress of 120 members. In addition to passing laws, Congress ratifies treaties, authorizes government loans, and approves the government budget. The president has the power to block legislation with which the executive branch does not agree.

The judicial branch of government is headed by a 16-member Supreme Court seated in Lima. The Constitutional Tribunal interprets the constitution on matters of individual rights. Superior courts in departmental capitals review appeals from decisions by lower courts. Courts of first instance are located in provincial capitals and are divided into civil, penal, and special chambers. The judiciary has created several temporary specialized courts, in an attempt to reduce the large backlog of cases pending final court action. In 1996 a human rights ombudsman's office was created to address human rights issues.

Peru is divided into 24 departments and the constitutional province of Callao, the country's chief port, adjacent to Lima. The departments are subdivided into provinces, which are composed of districts. Authorities below the departmental level are elected.

Principal Government Officials
President--Alejandro TOLEDO Manrique
First Vice President--Raul DIEZ CANSECO
Second Vice President--David WAISMAN Rjavinsthi

President of the Council of Ministers (Prime Minister--Luis SOLARI
Foreign Relations Minister--Allan WAGNER Tizon
Defense--Aurelio LORET DE MOLA
Economy and Finance--Javier SILVA RUETE
Interior--Gino COSTA
Justice--BR> Education--Gerardo AYZANOA de Carpio
Health--Fernando CABONE Campoverde
Agriculture--Alvaro QUIJANDRIA
Labor--Fernando VILLARAN de la Puente
Commerce, Tourism--Raul DIEZ CANSECO
Production--Eduardo IRIARTE Jimenez Transport and Communications--Javier REATEGUI
Energy and Mines--Jaime QUIJANDRIA Salmon
Promotion of Women and Human Development--Ana Maria ROMERO
Ambassador to the United States--Roberto DA�INO
Permanent Representative to the United Nations--Jorge VALDEZ Carrillo
Ambassador to the Organization of American States--Eduardo Ferrero Costa

Peru maintains an embassy in the United States at 1700 Massachusetts Avenue, NW, Washington, DC 20036 (tel. 202-833-9860/67, consular section: 202-462-1084). Peru has consulates in New York; Paterson, NJ; Miami; Chicago; Houston; Los Angeles; San Francisco; and San Juan, Puerto Rico.

The Government of Peru is in a state of democratization. Led by President Alejandro Toledo, the executive branch is becoming more transparent and accountable. Previously a rubberstamp body, the Congress is emerging as a strong counterbalance to the once dominant executive branch, with increased oversight and investigative powers. The executive branch and Congress are attempting to reform the judicial branch, antiquated and rife with corruption. Peruvians, whose expectations were raised during the campaign, are frustrated at the slow pace of economic recovery and job creation. As discontent rises, the Toledo administration is in a race to strengthen the economy so that popular pressures do not force a shift to more populist measures.

So far, the Toledo government remains committed to orthodox economic policies and structural reform, which, over time, should attract sufficient international investment to generate high growth and job creation. Establishment of an impartial, efficient judiciary probably will be the most difficult goal to achieve. Other important political currents stem from the ongoing investigation of Fujimori era corruption and an increase in activities by terrorist group Sendero Luminoso. Regarding the latter, the Toledo government has been forced to consider putting resources back into the security forces which they had been hoping to use to fund social programs.

From 1994 through 1997, the economy recorded robust growth driven by foreign direct investment, almost 46% of which was related to the privatization program. The economy stagnated from 1998 through 2001, the result of the century's strongest "El Ni�o" weather phenomenon, global financial turmoil, political instability, a stalled privatization program, increased government intervention in markets, and worsening terms of trade. President Alejandro Toledo implemented a recovery program after taking office, maintained largely orthodox economic policies, and took measures to attract investment, including restarting the privatization program. Nonetheless, political uncertainty led to GDP growth of 0.2% in 2001. The Lima Stock Exchange general index fell 34.5% in 2000 and 0.2% in 2001. Inflation remained at record lows, registering 3.7% in 2000.

The year 2001 saw deflation of 0.1%. The government's overall budget deficit rose sharply in 1999 and 2000 to 3.2% of GDP, the result of hikes in government salaries, expenditures related to the 2000 election campaign, higher foreign debt service payments, and lower tax revenues. The government brought the deficit down to 2.5% of GDP in 2001, and set a target of 1.9% of GDP for 2002. Peru's macroeconomic stability brought about a substantial reduction in underemployment, from an average of 74% from the late 1980s through 1994 to 43% in the 1995-96 period, but the rates began climbing again in 1997-2002 to over half the working population. The poverty rate remained at 54% in 2001, with 24% of Peruvians living in extreme poverty.

Foreign Trade and Balance of Payments
The current account deficit dropped in 2001 to about 2.2% of GDP ($1.17 billion)--from 3.1% in 2000--while the trade balance registered a small deficit. Exports dropped slightly to $7.11 billion, while imports fell 2.1% to $7.20 billion. After being hit hard by El Ni�o in 1998, fisheries exports have recovered, and minerals and metals exports recorded large gains in 2001 and 2002, mostly as a result of the opening of the Antamina copper-zinc mine. By mid-2002, most sectors of the economy were showing gains. After several years of substantial growth, foreign direct investment not related to privatization fell dramatically in 2000 and 2001, as well as in the first half of 2002. Net international reserves at the end of May 2002 stood at $9.16 billion, up from $8.6 billion at the end of 2001.

Foreign Investment
The Peruvian Government actively seeks to attract both foreign and domestic investment in all sectors of the economy. International investment was spurred by the significant progress Peru made during the 1990s toward economic, social, and political stability, but it slowed again after the government delayed privatizations and as political uncertainty increased in 2000. President Alejandro Toledo has made investment promotion a priority of his government. While Peru was previously marked by terrorism, hyperinflation, and government intervention in the economy, the Government of Peru under former President Alberto Fujimori took the steps necessary to bring those problems under control. Democratic institutions, however, and especially the judiciary, remain weak.

The Government of Peru's economic stabilization and liberalization program lowered trade barriers, eliminated restrictions on capital flows, and opened the economy to foreign investment, with the result that Peru now has one of the most open investment regimes in the world. Between 1992 and 2001, Peru attracted almost $17 billion in foreign direct investment in Peru, after negligible investment during the 1980s, mainly from Spain, the United States, the United Kingdom, Panama, and Netherlands. The basic legal structure for foreign investment in Peru is formed by the 1993 constitution, the Private Investment Growth Law, and the November 1996 Investment Promotion Law. Although Peru does not have a bilateral investment treaty with the United States, it has signed an agreement (1993) with the Overseas Private Investment Corporation concerning OPIC-financed loans, guarantees, and investments. Peru also has committed itself to arbitration of investment disputes under the auspices of ICSID (the World Bank's International Center for the Settlement of Investment Disputes) or other international or national arbitration tribunals.

Economic Outlook
Forecasts for the medium- and long-term remain positive, even though both the economic situation and political climate remain difficult. Peru's real GDP growth in 2002 will likely be among the highest in the region, expected to be over 3%. Inflation is likely to remain low, at about 2%, while the budget deficit is expected to fall to about 2% of GDP. Private investment should begin to pick up, mostly as a result of privatizations. Exports and imports are expected to rise. The unemployment and underemployment indexes (11% and 54%, respectively, in Lima) should begin to come down again as the economic picks up. Over the next few years, the country is likely to attract both domestic and foreign investment in the tourism, agriculture, mining, petroleum and natural gas, and power industries.

The fight against narcotics trafficking in Peru has resulted in an unprecedented 70% reduction since 1995 in the number of acres of illegal coca leaf under cultivation. The impact of this illicit industry to the national economy is difficult to measure, but estimates range from $300-$600 million. An estimated 200,000 Peruvians are engaged in the production, refining, or distribution of the narcotic. Many economists believe that large flows of dollars into the banking system contribute to the traditional depression in the dollar exchange rate vis-a-vis the sol, and create a climate in which money-laundering can flourish. The Central Bank engages in open market activities to prevent the price of the sol from rising to levels that would otherwise hurt Peruvian exports.

Hurt economically by successful Peruvian Air Force interdiction efforts in the mid-1990s, drug traffickers are now using land and river routes as well as aircraft to transport cocaine paste and, increasingly, cocaine hydrochloride (HCL) around and out of the country. The airbridge denial interdiction program was suspended in April 2001 after the Peruvian Air Force misidentified a U.S. missionary aircraft as a drug trafficker and shot it down, killing two American citizens on board. Aerial interdiction of drug traffickers may resume once adequate training and safety measures have been instituted by the U.S. and Peruvian Governments. Peru continues to arrest drug traffickers and seize drugs and precursor chemicals, destroy coca labs, disable clandestine airstrips, and prosecute officials involved in narcotics corruption.

Working with the U.S. Agency for International Development (USAID), the Peruvian Government carries out alternative development programs in the leading coca-growing areas in an effort to convince coca farmers not to grow that crop. Although the government previously eradicated only coca seed beds, in 1998 and 1999 it began to eradicate mature coca being grown in national parks and elsewhere in the main coca growing valleys. In 1999 the government eradicated more than 15,000 hectares of coca; this figure declined to 6,500 hectares in 2000, due largely to political instability. The government agency "Contradrogas," founded in 1996, facilitates coordination among Peruvian Government agencies working on counter narcotics issues.

In October 1998, Peru and Ecuador signed a peace accord which definitively resolved border differences which had, over the years, resulted in armed conflict. Peru and Ecuador are now jointly coordinating an internationally sponsored border integration project. The U.S. Government, as one of four guarantor states, was actively involved in facilitating the 1998 peace accord between Peru and Ecuador and remains committed to its implementation. The United States has pledged $40 million to the Peru-Ecuador border integration project and another $4 million to support Peruvian and Ecuadorian demining efforts along their common border.

In November 1999, Peru and Chile signed three agreements which put to rest the remaining obstacles holding up implementation of the 1929 Border Treaty. (The 1929 Border Treaty officially ended the 1879 War of the Pacific.) In December 1999, President Fujimori made the first visit ever to Chile by a Peruvian head of state.

Peru has been a member of the United Nations since 1949, and Peruvian Javier Perez de Cuellar served as UN Secretary General from 1981 to 1991. Former President Fujimori's tainted re-election to a third term in June 2000 strained Peru's relations with the United States and with many Latin American and European countries, but relations improved with the installation of an interim government in November 2000 and the inauguration of Alejandro Toledo in July 2001 after free and fair elections. Peru is planning full integration into the Andean Free Trade Area. In addition, Peru is a standing member of APEC and the WTO, and is an active participant in negotiations toward a Free Trade Area of the Americas (FTAA).

The United States enjoys strong and cooperative relations with Peru. Relations were strained following the tainted re-election of former President Fujimori in June 2000, but improved with the installation of an interim government in November 2000 and the inauguration of the government of Alejandro Toledo in July 2001.. The United States continues to promote the strengthening of democratic institutions and human rights safeguards in Peru and the integration of Peru into the world economy.

The United States and Peru cooperate on efforts to interdict the flow of narcotics, particularly cocaine, to the United States. Bilateral programs are now in effect to reduce the flow of drugs on Peru's extensive river system and to perform ground interdiction in tandem with successful law enforcement operations. As of mid-2002, the United States was considering whether to resume cooperation on an aerial interdiction program. The United States and Peru cooperate on promoting programs of alternative development in coca-growing regions.

U.S. investment and tourism in Peru have grown substantially in recent years. U.S. exports to Peru were valued at $2.0 billion in 2001, accounting for about 30% of Peru's imports. In the same year, Peru exported $1.9 billion in goods to the United States, accounting for about 27% of Peru's exports to the world.

About 200,000 U.S. citizens visit Peru annually for business, tourism, and study. About 16,000 Americans reside in Peru, and more than 400 U.S. companies are represented in the country.

U.S. Economic Assistance
U.S. bilateral assistance to Peru, including food aid and disaster relief and rehabilitation, totaled nearly $1.4 billion during the 1990-2001 period. The USAID program in Peru is its second-largest in Latin America.

U.S. assistance to Peru is focused on six strategic objectives: strengthening democratic processes and institutions; increasing economic opportunities for the poor in selected economic corridors; improving health for Peruvians at high risk; strengthening environmental management to address priority problems; supporting sustained reduction of illicit drug crops in target areas; and expanding opportunities for girls' basic education in targeted rural areas. Improving the quality of life of Peruvians along the Peru-Ecuador border area is an additional objective of U.S. Government development assistance.

Democracy. U.S. assistance seeks to strengthen democratic institutions, promote more effective local governments; promote and protect human rights, foster citizen participation, and strengthen women's participation in decisionmaking processes. Through USAID, the United States is providing more than $17 million in 2002 to support these goals.

Reducing poverty. USAID aims to improve the policy environment for private sector-led growth, expand access to markets, improve production, improve access to and distribution of food resources, and improve access to public utilities in poverty areas. U.S. food assistance programs reach about 1.8 million poor Peruvians annually in rural highlands and jungle areas, where the majority of the extreme poverty is found.

Health. U.S. assistance is improving child survival and maternal health services --such as immunization, diarrhea control, and prenatal care--and strengthening and expanding the participation of public and private sector entities in HIV/AIDS prevention. In family planning, activities with the non-governmental organizations (NGO) sector include efforts to strengthen the capacity of NGOs to supply family planning methods in urban and rural areas, increase the sustainability of the supply of contraceptives, and disseminate information on family planning methods and services. USAID's support to the Ministry of Health has made substantial improvements in this area. Infant mortality rate fell from 57 per 1,000 births in 1991 to 33 in 2000, while immunization campaigns for children younger than 1 reached 97.5% coverage.

Environment. USAID's strategy focuses on improving the legal, policy, regulatory, and normative environment and natural resource framework; promoting pollution prevention in selected pre-urban and industrial settings; and protecting natural resources, including biological diversity and fragile ecosystems. USAID has provided important assistance to the Peruvian Government to improve the legal, regulatory, and policy framework that established clearer rules on environmentally sustainable natural resource use. Among these were the National Environmental Council's Structural Framework for Environmental Management, the Ministry of Industry's Environmental Regulation, the Framework Law for Sustainable Use of Natural Resources, and the Pollution Prevention Oriented Environmental Framework Legislation for the Fisheries and related industries.

Alternative development. USAID seeks to reduce coca leaf cultivation through alternative development and environmental protection programs, as well as to reduce drug use and addiction through prevention, awareness, and rehabilitation programs. It also seeks to increase the commitment of farmers and communities to reduce illicit coca production voluntarily. USAID, together with Peruvian and U.S. law enforcement actions, has contributed to a 70% reduction of hectares devoted to coca cultivation (from 115,300 Ha in 1995 to 34,000 Ha) in 2001. As a result, over the same period the capacity of Peru to produce cocaine hydrochloride, or HCl, declined from 525 tons to 145 tons. As of 2000, the total gross agricultural production value of the alternative crops in targeted areas outweighed the total gross production value of coca leaf by 39%. As a result of this and other social infrastructure projects (e.g., schools, health clinics, potable water systems and farm to market roads and bridges), the living conditions of over 80,000 families in 1,600 communities were improved.

Education. This strategic objective is aimed at assisting the Government of Peru and civil society organizations to develop initiatives that address critical constraints to basic education of girls in rural areas in Peru. As a result, USAID has contributed to the establishment of a National Network for Girls' Education in Peru, with the participation of Peruvian Government sectoral ministries, NGOs, universities, the business community, and donors. This national network has been very active in increasing consciousness about the importance of girls' education in Peru. In addition, Peru has been chosen as the South America site of the Centers of Excellence in Teacher Training (CETT) that grew out of the 2001 Summit of the Americas in Quebec. The purpose of the CETT is to improve the practices of classroom teachers so that they become more effective reading instructors in the early primary grades.

Principal U.S. Embassy Officials
Ambassador--John Dawson
Deputy Chief of Mission--John P. Caulfield
Director, USAID Mission--Patricia Buckles
Counselor for Political Affairs--Alexander H. Margulies
Counselor for Economic Affairs--Timothy M. Stater
Counselor for Narcotics Affairs (NAS--James H. Benson
Counselor for Public Affairs--Josie Shumake
Counselor for Administrative Affairs--Elizabeth Hinson
Counselor for Consular Affairs--David Buentello
Commercial Attache--Rebecca K. Armand
Naval and Defense Attache--Capt. Raymond Anderson
Army Attache--Col. Dan Meyer
Air Attache--Col. Robert Mitchell
Chief, Military Assistance Advisory Group (MAAG)--Col. Bruce P. Yost
Consular Agent, Cuzco--Olga Villagarcia

The  U.S. Embassy in Peru is located at Avenida Encalada, Cuadra 17 s/n, Monterrico (Surco), Lima 33 (tel. (511) 434-3000; fax. (511) 434-3037).

The embassy is open from 8:00 a.m. to 5:00 p.m., Monday-Friday, except U.S. and some Peruvian holidays. The mailing address from the United States is American Embassy Lima, APO AA 34031 (use U.S. domestic postage rates). The American Citizen Services section is open to the public from 8:00 a.m. to 12:00 p.m.

The Consular Agency in Cuzco is located at Anda Tullamayu 125 (tel. (51) (84) 224112 or (51) (84) 239451; fax. (51) (84) 233541). The USAID Building is located at Av. Encalada cdra. 17 s/n, Monterrico (Surco) Lima 33, (tel. (511) 618-1200.

Other Contact Information
U.S. Department of State
Bureau of Western Hemisphere Affairs
Office of Andean Affairs (Room 5906)
2201 C Street N.W.
Washington, D.C. 20520-6263
Tel: 202-647-3360
Fax: 202-647-2628

U.S. Department of Commerce
International Trade Administration
Office of Latin America and the Caribbean
14th and Constitution, NW
Washington, DC 20230
Tel: (202) 482-0475
Fax: (202) 482-0464

American Chamber of Commerce of Peru
Avenida Ricardo Palma 836, Miraflores
Lima 18, Peru
Tel: (511) 241-0708
Fax: (511) 241-0709