May 24, 2006

Garcia fights for Peru votes with “responsible” pledge

By Robin Emmott

PISCO, Peru (Reuters) - Alan Garcia, who left Peru
economically ruined when he led the country two decades ago, is
now ahead in polls for the June presidential runoff but is
still fighting hard to convince voters he wants "responsible

Canvassing for votes along Peru's southern coast, Garcia
pledged to renegotiate Peru's recently signed free-trade accord

with the United States to benefit farmers, offered credit
for the region's depressed industries and said he would create
thousands of better-paid jobs for day laborers.

"A free-trade deal is all very well, but we don't want it
if it's going to crush our farmers and peasants," he told
reporters near Pisco, some 190 miles south of Lima.

"Our proposal will be to renegotiate that deal," he added
as poor Peruvians thronged around him during a walkabout in the
rubbish-strewn streets of the impoverished port town.

Garcia, who was president from 1985 until 1990, leads his
rival, former army commander Ollanta Humala, by 56 percent to
44 percent in the race, according to a weekend Apoyo poll.

But a quarter of voters are undecided or say they will ruin
their vote on June 4 because they cannot forget the
hyperinflation of Garcia's first government and say Humala's
plan to put the economy under state control is too radical.

That makes it crucial for Garcia, 57, to win over voters
who did not back him in the first round in April and to connect
with Peruvians who are also attracted by Humala's radical
message of revolution for the poor, political analysts say.

Garcia, whose party members have painted his "responsible
change" slogan across southern Peru, where Humala, 43, also has
support, appears to be getting through to some.

"Humala is full of contradictions so maybe it is time to
give Garcia another chance. He says he'll help us," said Luis
Luega, who owns a small fish processing business and who did
not vote for the former president in the first round.

Garcia is seen as the most business-friendly candidate by
investors. Business leaders and bond traders say he will need
to ratify the free-trade deal with Washington to meet his
campaign promise of 7 percent annual economic growth.


The United States is Peru's biggest trading partner,
generating 30 percent of the Andean nation's $17 billion in
exports last year. But the temporary duty-free access that Peru
enjoys will run out at the end of this year, potentially
hurting its export-led economy.

Humala has also pledged to renegotiate or scrap a U.S.
free-trade pact, although analysts see Garcia as more likely to
ratify the accord because the former president depends on his
support from Peru's business sector.

"Peru needs trade and it needs investment. That will help
the poor just as much," said Carlos del Solar, president of
Peru's National Society of Mining, Petroleum and Energy, one of
the country's main business groups. "We need to be more
proactive to help small businesses find new markets, not fall
into populism," he added.

Indeed, poor cotton and vegetable farmers along the
southern coast called on Garcia to build an industrial park if
elected to help them get higher-paying jobs in industry.

"With a farm job you work for a pittance. We deserve the
best chance that Garcia can give us for a better life," said
30-year-old day laborer Charlie Hernandez.

(Additional reporting by Maria Luisa Palomino)