Archive for poverty

20060328 – Peru’s economic trickle down proves elusive

Posted in 3 Cables with tags , , , , , , , , , , , , , , , , , on June 9, 2009 by Farid Matuk

By Robin Emmott

AYACUCHO, Peru (Reuters) – Business has rarely been slower at Marlene Quispe’s underwear shop in the central Andes as the only thing that the rows of socks and bras seem to attract nowadays is dust from the street outside.

As Peru’s economy is set to record its fifth consecutive year of strong growth in 2006 — a feat almost unheard of in the country’s cyclical boom and bust history — ordinary Peruvians say they are seeing little or no benefit, making the economy a central issue in the upcoming April 9 presidential elections.

“There’s no prosperity here and we want change,” Quispe said as she sorted through piles of bras. “A lot of people are tired of waiting for this trickle down,” Quispe said.

That view is echoed around Peru despite encouraging signs such as new shopping centers and restaurants in Lima as well as robust commerce in towns near the country’s gold and copper mines. Yet job growth has proven elusive in an economy that expanded 6.7 percent last year.

Much to the chagrin of business leaders, presidential front-runner Ollanta Humala says the only way to bring the benefits of this growth to ordinary Peruvians is to increase state control over the economy.

He has received strong support from the poor as a protest vote for the country’s traditional economic policies.

“The idea that there is a trickle-down effect to the poor from economic growth is just an invention by Mister President (Alejandro Toledo),” said Omar Quezada, president of the Ayacucho region in central Peru, where 35 percent of the population is illiterate.

“We haven’t seen a large public works project in this region in the past five years,” he added.

Toledo, who took office in 2001 promising jobs and a better life for the poor, has argued that it is only a matter of time before the benefits of economic growth are widespread.

But economists say that despite average gross domestic product (GDP) growth of 4.5 percent over the past 15 years, the work force is growing at 3 percent a year, meaning new graduates are barely being absorbed into the job market.

“Peru’s poverty levels have barely fallen, the new jobs on offer are low-skilled and all we’ve really achieved is stability,” said Elmer Cuba, chief economist at Lima-based consultant Macroconsult. “People are exasperated.”


Many Peruvians say their frustration is heightened by the fact that since 1990, successive governments have done just what foreign economists told them to — privatize, liberalize and open the economy up to foreign investment.

Peru’s problem is that its mining and export-based sectors are the drivers of growth and people outside of those industries are not benefiting from high international prices for commodities and precious metals.

“The economy is simply not broad-based enough,” said Javier Zuniga, head of Lima University postgraduate business school.

Although Peru’s powerful mining sector generates more than half the country’s exports and accounts for 6 percent of GDP, it employs less than 1 percent of the working population.

According to Farid Matuk, head of the government’s National Statistics Institute, around 14 times more investment is required to create one job in the mining sector than in manufacturing, where Peru has traditionally been weak.

Partly as a result, the jobless rate in Lima, home to almost a third of the population, was 9 percent in February, or almost 1 percentage point higher than a low in Toledo’s government of 8 percent in October 2002.

Even that figure fails to take into account that half of Peru’s 13 million working population is underemployed, or not working the hours they want to, forcing them into lower-paid positions below their qualifications.

The solution that candidates pledge is red-hot growth over the next five-year presidential period and big job creation.


Most ambitiously, center-right lawyer Lourdes Flores, who is in second place in the polls, has promised GDP growth of at least 7 percent a year and 650,000 new jobs annually.

But center-left former President Alan Garcia, who is third in the polls, says meeting such goals are impossible.

“You would need to grow almost 14 percent a year to create 650,000 jobs annually,” said Enrique Cornejo, an aide to Garcia.

Nevertheless, he also promises annual growth of 7 percent, a figure Peru last reached briefly in 1998.

With Peru’s current economic structure, analysts say such a pace of growth would generate around 350,000 new jobs a year, or just enough to keep up with new entrants into the job market.

Humala, a former military commander who wants to restrict foreign investment in Peru, sees the solution in revising contracts in key mining and gas industries to increase state control, raise taxes and redistribute income to the poor.

Businesses and investors say that would scare off investment. A similar strategy employed by a Peruvian military government in the 1970s sent the economy spiraling into a 30-year slide.

Economists instead recommend measures such as cutting the bureaucracy that stifles entrepreneurship, helping unregistered businesses leave the informal sector, diversifying away from mining and cutting the bloated state payroll.

Around 90 percent of Peru’s budget goes to public sector salaries and debt servicing, leaving little room for government investment, which can help fuel economic growth.


20080711 – Peru’s Economic Model and Poverty Reduction: Is It Working?

Posted in 3 Cables with tags , , , , , , , , , , , , , , , , , on June 4, 2009 by Farid Matuk

The relationship between Bolivia and Peru has deteriorated rapidly over the last year, in part because of disagreements on foreign trade issuess. Recently, Peruvian President Alan Garcia and his Bolivian counterpart, Evo Morales, engaged in personal attacks which served to increase tensions between the two Andean nations. On July 2nd, Garcia attacked Morales by saying the latter was jealous of Peruvian economic growth. Maybe Garcia has a point in observing that Peru’s economic growth is more robust than Bolivia’s, but economic growth is not necessarily the ultimate objective for a country; more important may be the satisfaction of its citizens, which in Peru is trending downward because of growing inequality.

In its chronic struggle against poverty, Latin America has experimented with various economic models. These have included the neoliberal policies of the 1980s and 1990s, which have led to increased inequality. Some see neoliberal failures as responsible for the leftist wave that has spread across the region. Peru, however, is one of the two countries in Latin America that have not been tempted recently by solutions calling for the abandonment of the neoliberal development model.

The Peruvian model has produced an exceptional economic growth over the last five years. In 2007, Peru’s GDP growth rate was more than eight percent. The following year, the U.S. ratings agency Fitch gave Peru an investment-grade rating, meaning that after thorough analysis of recent economic trends, the agency now considers Peru a safe and hospitable investment venture.

Profitable policies, but largely for the elite
Unfortunately, as the country’s economy grew, so did its inequality. This trend is especially evident in contrasting Peru’s coastal region with the Andes, with most of the increase in personal income being concentrated in Lima and other coastal urban areas. This can readily be seen in the luxurious beach clubs to the south of Lima, which epitomize the often fabulous wealth of the Peruvian elites. In contrast, Peru’s National Statistics and Information Institute (INEI) recently reported that rural highlands were the least succesful areas in reducing poverty during 2007. Many communities here still practice subsistence agriculture and suffer from extreme poverty, even though the region is rich in mineral resources – Peru’s main export.

During the Alejandro M. Toledo presidency (2000–2005), Peru’s Gini coefficient increased from 49.8 in 2000 to 52 in 2003, demonstrating a considerable rise in inequality. The significance of this injustice is not just statistical or ideological, because increasing economic inequality inevitably leads to public dissatisfaction, which in turn contributes to the country’s instability. Public dissatisfaction with uneven growth was manifested in Toledo’s approval ratings, which were the lowest in South America in 2004. This apparently has been recognized by the new president, Alan Garcia, who announced in May a budget increase of S./ 203 million (around $70 million) for the social program ‘Juntos’ which originally was launched by Toledo in 2005.

The ‘Juntos’ program: squandered genius?
The ‘Juntos’ program provides subsidies to poor families on the condition that they regularly send their children to schools and health centers. ‘Juntos’ is an attempt to recreate programs taken from Mexican and Brazilian models, which were designed to increase literacy rates and decrease economic inequality. Unfortunately, objective conditions in Peru make this program unlikely to succeed, because the nation’s primary education and healthcare systems are among the most inadequate in the world. Additionally, the program has targeted urban areas and neglected rural regions, which are most in need of government assistance.

It would not be surprising if ‘Juntos’ does not fulfill its purpose because Lima has proven extremely innefficient at implementing social programs in the past. The ‘Vaso de Leche’ effort in the 1990s failed to achieve its goal of reducing malnutrition in five-year-old children, even though it was the most widespread program of its kind in the country. Such examples reaffirm the challenge that would be involved in successfully expanding the ‘Juntos’ program. Ultimately, ‘Juntos’ expansion cannot contribute to sustainable development if the country’s education and healthcare structures are not first reformed.

Still, some statistics suggest that ‘Juntos’ may be helping to decrease overall poverty. The INEI recently announced a sizeable 5.2 reduction in poverty in 2007. However, many have questioned the validity of these numbers, including Farid Matuk, an ex-president of INEI, who guesses that such numbers might be forged. They suggest a poverty reduction rate of 0.6 percent per each point of GDP growth, which is three times higher than the average of previous years. At this rate, Peru would eliminate poverty completely in about 10 years, which strains credulity. Despite the surprising results, several institutions, including the World Bank and two Peruvian universities, supervised the study’s methods and verified the validity of the statistics. If they are valid, then ‘Juntos’ may yet be the reason behind the reduction in poverty, considering it was being implemented when the purported drop began to accelerate.

Development must be sustainable
Every effort must be made to continue to promote poverty reduction. In the past, social programs repeatedly have failed to create sustainable development within the Peruvian neoliberal model. The economic expansion experienced by Peru between 1991 and 1997 in factreduced poverty by several points. However, the subsequent 1998 to 2001 recession was a huge step backwards, suggesting that the social programs in the 1990s failed to create sustainable development at the time. Will the new expansion be different, or will a future recession negate all of the advances which have been made?

Peru’s Economic Minister, Luis Carranza, optimistically has predicted that Peru will experience 10 to 15 years of economic growth starting in 2008. This would represent the longest expansion cycle in Peruvian history and would lead to a significant reduction in poverty. ‘Juntos’ could potentially play a part in Peru’s economic success, but for Carranza’s dream to become reality, the government must first take aggressive steps in favor of sustainable development and adequately address the problems of inequality, healthcare and education. Without such reforms in these areas, programs like ‘Juntos’ cannot create sufficient opportunities for the poor, no matter how carefully they are nurtured.

This analysis was prepared by COHA Research Associate Guillermo Cornejo

20090324 – Hunger intensifies despite economic growth in Peru

Posted in 3 Cables with tags , , , , , , , , , , , , , , , , on March 28, 2009 by Farid Matuk

32 percent of Peruvians get inadequate food

Slower economic growth likely to push up hunger rates

By Dana Ford

LIMA, March 24 (Reuters) – More Peruvians went hungry last year despite blazing economic growth, a sign that President Alan Garcia is stumbling in efforts to direct benefits of an impressive expansion to the poor.

The percentage of people in Peru with inadequate nutrition rose by more than 11 percent in 2008, faster than the economy’s 9.8 percent surge, according to the national statistics agency.

Now, 32 percent of Peruvians do not get enough to eat.

The results suggest the poor did not make gains during Peru’s economic boom last year. They also explain in part why the government is so unpopular in rural areas, where hunger rates are highest and leftist politicians like Ollanta Humala, who plans to run for office in 2011, draw support.

“The benefits of the economic boom have not been distributed equally,” said Federico Arnillas, president of a network of civic groups that works on poverty issues with the health and finance ministries.

Garcia, who embraced mainstream economic policies after his first term in the 1980s ended in runaway inflation that made adequate food too costly for millions of people, has said he wants to reduce poverty to 30 percent by the time he leaves office.

When he was re-elected in 2006, Garcia fervently pushed investment and free trade and his recipe to lift incomes seemed to work. Prices for Peru’s metal exports surged and domestic demand rose, contributing to rapid economic growth.

The national poverty rate fell 5 percent in 2007 to 39 percent, a year when inflation was low and public spending on food programs was relatively high.

But in 2008, hunger crept up, as inflation spiked on a global run up in food prices and aid spending fell. Peru’s poverty rate for last year is not yet available, but experts say the government may have lost ground. That could hurt Garcia’s approval rating, now at 34 percent.

“The numbers tell us there is a percentage of the population that is, quite literally, dying of hunger,” said Farid Matuk, a former director of the national statistics agency and a government critic.

In rural areas, where Garcia’s support is weak, the number of people not eating enough rose to 42.5 percent in 2008.

Arnillas said the increase stems from political decisions and pointed to cuts in social spending.

“It’s not a simple resource problem. It’s a political one,” he said of hunger in Peru.


Advocates say slower economic growth this year will likely push hunger rates higher and are urging the government to adopt policies that prioritize food security.

Peru’s government is rolling out a $3 billion stimulus package meant to maintain investment and employment levels and increase public work projects. The plan, which aims for economic growth of at least 5 percent, also includes agricultural incentives to boost local food production.

Matuk, the former statistics agency head, said the government is too focused on high macroeconomic growth figures and should have paid more attention to the poor before the global economy entered a crisis.

Arnillas said Peru needs a bigger safety net as private economists forecast growth of less than 1 percent this year.

“We are worried the poor will wind up paying the cost of the crisis,” he said. “This is what happened in the past and we are working to make sure it does not happen again.” (Editing by Terry Wade and Vicki Allen)

Garcia takes power facing Peru poverty “time bomb”

Posted in 3 Cables with tags , , , , , , , , , , , , , , , , , , , , , , , , on January 30, 2009 by Farid Matuk


By Robin Emmott  |  July 26, 2006

PUNO, Peru (Reuters) – President-elect Alan Garcia takes office on Friday warning Peru is a “time bomb” that could explode into crippling protests if his government cannot combine its pro-business agenda with cutting chronic poverty.

Garcia, who is anxious to make amends for his disastrous first term in 1985-1990 that sparked economic collapse, faces the huge challenge of delivering the benefits of Peru’s unprecedented economic growth since 2002, while keeping international bondholders happy with a careful fiscal policy.

Poor Peruvians make up half the country’s 27 million population, especially in the southern Andes bordering Bolivia, and most did not vote for Garcia. They are impatient for jobs, access to clean drinking water and schools and hospitals.

“We’ll give Garcia six months to show some results. If nothing’s happened, we’ll start the protests,” said Luis Vilcapaza, who represents some 100,000 farmers in Peru’s southern Andes province of Puno.

Investors are keen to avoid the kind of political instability that almost toppled outgoing President Alejandro Toledo in 2004 and take advantage of Peru’s oil, gas and mineral wealth. Peru is the world’s No. 3 copper-producing nation and aims to export natural gas to Mexico from 2010.

Garcia’s presidential win in June was by a slim margin, giving him a weak mandate in a fractured congress.

His left-leaning American Popular Revolutionary Alliance party, known as APRA, is in the minority, while the party of losing presidential candidate Ollanta Humala has promised fierce opposition from its 45 seats in congress, nine more than


“We face a time bomb because during Toledo’s term, the economy grew to benefit only 30 percent of the population,” Garcia said in a speech this month to residents of a shanty town on the edge of Lima.

“We will create economic progress that will allow us to confront these time bombs.”

Peruvians in the south say they want the kind of economic nationalism favored by Venezuela’s anti-U.S. President Hugo Chavez and Bolivian leader Evo Morales, not policies supported by Wall Street such as privatization.


They say that is the only way to ease social ills in a country where the gross domestic product per capita is lower than in 1975.

About 62 percent of young Peruvians are poor, according to a study by the U.N. Population Fund and the Peruvian health ministry.

The number of Peruvian women who die during childbirth is one of the highest levels in Latin America. One in three women in Peru’s jungle region become pregnant before age 20.

Malaria, tuberculosis and sexual violence against women also are all major problems in Peru.

“Garcia urgently needs to help the young,” outgoing Health Minister Pilar Mazetti told Reuters. “Otherwise we’ll see frustrations boil over into protests, the formation of gangs and the spread of sexually transmitted diseases.”

Farid Matuk, outgoing head of Peru’s National Statistics Institute, said the solution is not in faster economic growth, as Garcia has pledged, because the economy only needs to grow above 3.3 percent annually to alleviate poverty.

Rather, Garcia should aim to develop the economy away from its historic dependence on mineral exports by helping small businesses and improving the way public funds are spent.

Peru’s mining regions will receive a record $800 million in 2006 from royalties and taxes, equivalent to slightly more than the government’s total annual health and education budget. But locals and miners say the money is not being properly spent.

“We need to see jobs and better schools, working hospitals,” said 43-year-old rickshaw driver Gabriel Tipo, a widower in Puno with five children. “If things don’t get better, I think Humala should stage a coup and take over government.”

20060713 – Farid Matuk dice que intentan destruir sistema de monitoreo de pobreza

Posted in 24 Horas with tags , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , on January 30, 2009 by Farid Matuk

El jefe del Instituto Nacional de Estadística e Informática (INEI), Farid Matuk, señaló que las críticas emitidas por representantes apristas en relación con la metodología que se utiliza para el cálculo de la pobreza, reflejan la intención malévola de destruir el sistema de monitoreo de la pobreza que se desarrolla al presente.

 En conferencia de prensa realizada, Matuk señaló que el trasfondo en los cuestionamientos es impedir que se informe, junto con los resultados de éxito de la economía, los números de la terrible realidad social que atraviesa el país.

Dijo que la información trimestral que produce el INEI sobre la incidencia de la pobreza a nivel nacional desde el presente año, ha sido el tema que originó la serie de ataques personales lanzados tanto por el ex Ministro de Economía, Luis Alva Castro, como por el encargado de la Comisión de Transferencia del APRA y ex presidente del Banco de la Nación, Milton Guerrero.

En una entrevista televisiva propalada anoche, Guerrero admitió que desconoce el tema estadístico pero, dijo, tiene amigos y asesores que sí saben.

Matuk advirtió que “se trata de impedir que el Perú siga contando con información detallada, es decir, trimestral a nivel nacional y anual a nivel de provincia, de cómo viven los peruanos, y retroceder a circunstancias donde el Estado no medía la condición social”.

Explicó que el Perú cuenta con tres formas de medir el índice de pobreza. El primero se realiza a través de la Línea de Pobreza, que se estima a través del recojo de información sobre el monto mínimo de dinero que necesita una persona para vivir.

La segunda, continuó, corresponde a la medición de la pobreza según la ingesta de calorías (Déficit Calórico) de las personas, para ello se toma como referencia las 2100 calorías que señala la Organización Mundial de la Salud como la cantidad que necesita una persona adulta promedio para vivir. La tercera forma es la que se refiere al número de Necesidades Básicas Insatisfechas (NBI), y es la que recoge información sobre la calidad de vida (vivienda y educación) de las personas.

Si lo que se busca es conocer la evolución de la ingesta de alimentos de la población, es decir, los resultados de pobreza por déficit calórico para ese mismo periodo, se tiene que ésta se ha mantenido constante a nivel nacional, pasando de 33,3% de la población en el 2001 IV-trim. a 33,0% en el 2006 I-trim, explicó

Mientras que la medición según las Necesidades Básicas Insatisfechas, que debido al Censo Continuo (ENCO) se encuentra disponible desde el primer trimestre de este año por departamento, la pobreza por NBI alcanza al 48% de la población.

Farid Matuk señaló además, que según cita el Banco Mundial, el sistema estadístico peruano es el más exhaustivo, completo y detallado de Latinoamérica.

Agregó que la ejecución de los censos continuos, aplicación metodológica que permite recoger información sobre las Necesidades Básicas Insatisfechas (NBI), ha sido reconocida por estadísticos europeos de las Naciones Unidas.

Tras la discusión en Ginebra en el 2005, las mejores oficinas estadísticas del mundo se reunieron en junio del 2006 y aprobaron el documento de “Economic and Social Council” de las Organización de las Naciones Unidas (ONU), que incluye los censos continuos entre las seis alternativas metodológicas que utilizan los países para realizar una operación censal. El Perú desarrolla junto con EE.UU. este diseño.

Sobre la auditoría solicitada por representantes del APRA para revisar el cálculo de la pobreza, señaló que no le preocupa pues una evaluación mucho más exhaustiva y rigurosa ha sido el trabajar de manera permanente con la cooperación técnica internacional y ser respaldados por su experiencia.

De otro lado, dijo que de haberse utilizado la misma metodología que aplicó su antecesor, Félix Murillo, jefe del INEI entre el 10 de mayo de 1989 (gobierno aprista) y el 15 de diciembre de 2000 (gobierno de transición), la pobreza se habría reducido en 20 puntos porcentuales entre 1993 y el 2005, lo que significaría que solo el 34% de la población se encontraría en pobreza. “Resultado que no es aceptable”, dijo.

PERU: Upbeat Poverty Stats Questioned

Posted in 3 Cables with tags , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , on January 27, 2009 by Farid Matuk

By Milagros Salazar

LIMA, May 29 (IPS) – The Peruvian government has announced that poverty fell by 5.2 percent in a year and forecasts that by 2015, less than 10 percent of the population will be below the poverty line. But experts and provincial governors cast doubt on these figures, given the unmet basic needs of peasant families.

“These poverty figures show that Peru’s economic model is working,” Finance Minister Luis Carranza said on Wednesday after announcing that according to the National Institute of Statistics and Informatics (INEI), the proportion of people living in poverty dropped from 44.5 percent of the population in 2006 to 39.3 percent in 2007.

This means that nearly 1.4 million Peruvians have escaped poverty, and is an improvement on the 42 percent poverty rate projected by the authorities. President Alan García celebrated the result, saying that he had not been over-optimistic when he promised that by the end of his term, in 2011, poverty would be reduced to 30 percent.

“I can tell the country that my aspirations go even further and that by 2015 we will have a poverty rate of less than 10 percent of the population, which means that Peru will no longer be a Third World country,” said the president, making a forecast that exceeds his five-year term of office.

Meanwhile, the proportion of people living in extreme poverty shrank from 16.1 percent to 13.7 percent of the population. The country’s Andean highlands, as opposed to the coastal and Amazon jungle regions of Peru, are home to 67.5 percent of the extreme poor.

The results of the 2007 census, to be released on Jun. 9, will give a more precise idea of how many people have been lifted out of poverty, and what extrapolations can be made, said the head of INEI, Renán Quispe.

President García did not make allowances in his calculations for population growth, which is occurring at a rate of 1.3 percent a year. According to the latest official statistics, 27.2 million people live in Peru.

But Farid Matuk, a former head of INEI, said that the figures given out by the authorities were not credible.

“In spite of the nine percent gross domestic product growth posted in 2007, the García administration could not possibly have managed to reduce poverty by nearly 10 percent in two years, when the previous government of President Alejandro Toledo only achieved a fall of six points in five years,” Matuk told IPS.

The expert also said the García administration has manipulated the figures by increasing the 2005 poverty rate by nearly four percentage points, from 44.5 to 48 percent of the population, by changing the method used to measure poverty.

“These results are completely illogical. I suspect that urban incomes have been inflated in order to show this reduction in poverty,” Matuk said.

That would explain that poverty was reported to have fallen most in urban areas, from 31.2 to 25.7 percent.

But the figures show apparent improvement in rural areas as well. Between 2005 and 2006 rural poverty fell by only 1.6 percent, but in 2007 it was reduced by 4.7 percent.

The highlands region showed the least progress in fighting rural poverty, with a total reduction of only 3.2 percent, while in coastal rural areas poverty dropped by up to 11 percent.

In Matuk’s view, the INEI experts may have overvalued the prices assigned to the food grown by rural families

Since many families, mainly in the rural areas, grow their own food or provide their own essential services, such as water, INEI assigns these goods a value which, in Matuk’s opinion, should be made public, in order to assess the reliability of their figures.

Based on this method, INEI set the poverty line at 229.4 soles (82 dollars) a month per person, and the extreme poverty line at 121.2 soles (43 dollars) a month. Persons consuming less than these amounts are considered poor, or extremely poor, respectively.

“It’s important to know what price was assigned to some foods like eggs and potatoes, and also, for example, what value was established for ‘self-rent’ in marginalised urban areas. So far none of this is known, so the poverty lines are a mystery,” he said.

In response to the criticism, INEI published this information on its web site on Tuesday, and experts are now analysing it. INEI emphasised that it had received advice from the World Bank and several research centres in drawing up its report.

“The results are in compliance with international guidelines, and most importantly, they are transparent,” said World Bank regional director Felipe Jaramillo.

Matuk said that one way of demonstrating that the economic growth achieved between 2006 and 2007 had no impact on the living conditions of the majority of the population is that hunger had only been reduced by just over one percent — “in other words, hardly at all” — over the same period.

For his part, Pedro Francke, an economist at the Pontificia Catholic University, concluded that the method used by INEI did not take into account higher food prices, and was only showing one side of poverty. He said the institute should use a much broader form of measurement that is not only monetary.

“The quality of health and education services that are provided to the population should be measured, as well as whether or not people have identity documents, and what access they have to democracy, for example,” said Francke.

Several provincial governors expressed doubts that poverty reduction in their area could have been as great as the statistics suggest, especially in provinces where historically over 70 percent of the people were considered poor.

“The statistics must have been manipulated, because people are still protesting in the streets due to the fact that they are not seeing the benefits of economic growth. INEI does not measure poverty in villages and towns in the rural areas, where the extreme poor are concentrated,” Hernán Fuentes, the governor of Puno, told IPS.

In his southern Andean region, poverty fell from 76.3 percent to 67.2 percent, according to the official figures.

The poverty rate also fell in Ayacucho, another southern Andean province, from 78.4 to 68.3 percent. “We were sure that poverty had fallen by three or four percent, but not to such an extent. I hope it’s true,” said Governor Ernesto Molina.

Loreto, in the northeast, is the province that apparently made the most progress, with a spectacular 11.7 percent drop in the poverty rate. Governor Iván Vásquez said that such a reduction was indeed possible, but mainly in large cities like Iquitos, the provincial capital, where over half of the population lives.

In Cuzco, however, the poverty rate rose from 49.9 to 57.4 percent. “The social programmes aren’t working, because out of every 10 soles the government allocates to fight malnutrition or poverty, six are swallowed up by bureaucracy,” said Governor Hugo González.

Huancavelica remains the poorest province, with 85.7 percent of the population below the poverty line, after a reduction of barely three percent. ( END/2008 )

20080529 – Farid Matuk sostiene que el INEI alteró cifras con método de medición

Posted in La República with tags , , , , , , , , , , , , , , , , , , , , , , on January 27, 2009 by Farid Matuk

El ex jefe del Instituto Nacional de Estadística e Informática(INEI) Farid Matuk señaló que los porcentajes de reducción de la pobreza fueron alterados al ampliar al doble la población de referencia para elaborar las cifras.

En enlace telefónico desde Iraq, Matuk dijo que entre 1995 y 2004 se mantuvo como población de referencia a un quinto de la población total, ubicada entre el 30% y 50% de la pirámide de ingresos.

Sin embargo, agregó el matemático, con el gobierno de Alan García, se duplicó la población de referencia a los dos quintos y se la ubicó entre el 18% y 58% de la pirámide de ingresos.

“Ese cambio metodológico, desde un punto de vista matemático, necesariamente reduce la cifra porque disminuye el valor de la línea de la pobreza. Si lo cambiaron es porque lo necesitaban para algún propósito”, detalló.

Matuk negó que respirara por la herida, como dijera del Castillo.

“Hace tres semanas el premier dijo, como información preliminar, que la pobreza en 2007 se redujo en 2.5 puntos; pero al salir la información definitiva, resulta que fue el doble. Que explique por qué fallaron sus proyecciones”, finalizó.


Pedido. Matuk asegura que el INEI aún no publica las rutinas de programación para conocer el valor que se les impuso a los productos de la canasta familiar autogenerados en zonas rurales.

La dolce vita: Is Peru’s feelgood factor spreading?

Posted in 3 Cables with tags , , , , , , , , , , , , , on January 24, 2009 by Farid Matuk

By Jude Webber

PACHACUTEC, Peru, Nov 29 (Reuters) – President Alejandro Toledo boasts that more Peruvians are going to the movies — a sure sign, he says, that improving gross domestic product statistics mean la dolce vita (the sweet life) is spreading. Economists call it the trickle down effect — and trickle is the word, say residents in Pachacutec, a sprawling shanty town of straw and wood huts on the sandy hills sloping up from the Pacific Ocean at the northern fringe of Peru’s capital. “Things are gradually getting better. Two months ago I didn’t have a job. Now I have some work … It’s not great but I can pay for my daughter’s school,” said construction worker Emerson Reategui, 42, on his way with a sheaf of documents to apply for official property rights to his shanty town home.

“We’ve got to give Toledo more time to work. He’s made a lot of promises. In Pachacutec we feel he’s keeping them slowly — but he is keeping them in things like property rights, which he’s starting to give, and job projects,” said Carlos Ricaldi, 28, in his small but well-stocked store. “I see progress.” Toledo, who took office in July 2001 promising more jobs and prosperity, hails Latin America’s No. 7 economy as the region’s darling this year, saying international markets made their feelings plain by clamoring for a $500 million bond that Peru sold this week to raise cash to plug its budget deficit. Although the issue meant Peru beefing up its borrowing just as Argentina’s multiple debt defaults and Brazil’s ability to manage its $260 billion public debt have worried markets, economists were cheered by the relatively cheap interest rates it won. Peru expects its 2003 debt servicing costs to rise to $2.2 billion from around $2 billion now, but trumpets its nearly $10 billion in international reserves as a sign of solidity.

Indeed, the government is so delighted with the health of the economy — illustrated by ever rosier performance reports, including an official September growth figure of 7.3 percent — that it has jacked up its 2002 GDP growth target to 4.2 percent from a previous 3.7 percent. The acceleration comes after four years of economic woes and political strife. GDP grew just 0.2 percent last year. And the head of the government’s National Statistics Institute said this week even those glowing figures were still too low. Farid Matuk said methodology problems meant Peru had been “systematically underestimating” its data for years. Peru is hoping to parlay the good news into closer trade ties when U.S. Commerce Secretary Don Evans visits next week.


Toledo never tires of telling voters — many of whom are underwhelmed by his progress in creating jobs in a nation where more than half the people live on $1.25 a day — that he has sacrificed his popularity for the sake of economic prudence. The U.S.-trained business school professor, whose approval rating has climbed nearly 10 points recently but is still only around the mid-20s in polls, told reporters this week that rises in the numbers of moviegoers, cellphone users and supermarket sales showed an increasing feelgood factor. “You may ask what (the economy) has got to do with the cinema? Well, if you’ve got a job, you can go to the movies more,” he said. “The economy is becoming more dynamic, people are buying more. It’s slow but things are improving.”

At Peru’s top business forum this week, a partner at a headhunting firm said trade was picking up, and executives said the labor intensive construction sector was in full recovery. But Peru is a country of big contrasts — only one in five people in Lima do their shopping in supermarkets, as opposed to local markets, and the gap between rich and poor still yawns. “The levels of inequality have increased. There is more, but notmore for everyone,” Matuk said. Elmer Cuba, economist at private consultancy Macroconsult, said things were picking up slowly “but we still need stronger and more sustained growth for real salaries to grow, and that process is going to take years.”

Back in Pachacutec, one measure of quality of life is whether residents still have plastic drums outside their homes and have to wait for the water truck to trundle past or whether they can hook up to new standpipes on their dirt streets. Residents said European aid agencies or American evangelists, not the government, had brought the water. But they credit the government — which says it has created 160,000 jobs in state temporary work schemes — with giving them jobs as street cleaners and park builders.

“I feel a bit better. Not that much, but I’m less afraid of where I’m going to get food from than I was before,” said Angelica Azteca, a 28-year-old housewife and mother-of-three, who spends 15 soles ($4.30) a day on food for her family. But others were gloomier. “I feel just the same — it seems my pockets are full of holes. Money goes in and out like water,” said Luz Malaga, 54. “I think Toledo has good intentions, and that he’s trying to do something. But don’t they say the road to hell is paved with good intentions?”

(Additional reporting by Tania Mellado, Eduardo Orozco)
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