VZCZCXYZ0016
PP RUEHWEB

DE RUEHPE #1247/01 0892152
ZNY CCCCC ZZH
P 302152Z MAR 06
FM AMEMBASSY LIMA
TO RUEHC/SECSTATE WASHDC PRIORITY 9508
INFO RUEHBO/AMEMBASSY BOGOTA 3178
RUEHCV/AMEMBASSY CARACAS 9239
RUEHLP/AMEMBASSY LA PAZ MAR QUITO 0176
RUEHSG/AMEMBASSY SANTIAGO 0351
RUEHBR/AMEMBASSY BRASILIA 6618
RUEHGL/AMCONSUL GUAYAQUIL 4175
RHMFISS/CDR USSOUTHCOM MIAMI FL
RHEHNSC/NSC WASHDC
RUEKJCS/SECDEF WASHDC

C O N F I D E N T I A L LIMA 001247 

SIPDIS 

SIPDIS 

E.O. 12958: DECL: 03/20/2016 
TAGS: PGOV PINR ETRD PE
SUBJECT: HUMALA'S LIAISON TO BUSINESS SECTOR MEETS WITH THE 
AMBASSADOR 

REF: LIMA 1126 

Classified By: Ambassador Curt Struble.  Reason: 1.4(d). 

¶1.  (C)  SUMMARY:  Salomon Lerner Ghitis, ultranationalist 
"outsider" Union por el Peru (UPP) party presidential 
candidate Ollanta Humala's unofficial liaison to the business 
community, provided his impressions of Humala's policies, 
personality and advisors during a meeting with the Ambassador 
on March 24.  Lerner described Humala as honest, reasonable 
and not anti-American, although most of his advisors are. 
The latter, Lerner explained, feed "The Commandante's" 
paranoia, as evidenced by Humala's buying into a blogger's 
claim that the USG, through its funding of human rights 
organizations, was behind the allegations that Humala 
committed human rights abuses when serving in the Huallaga 
Valley in the early 1990s.  Lerner tried to be reassuring 
about Humala's intentions to "renegotiate" tax stability 
agreements, but had little to say other than to say that the 
UPP candidate wanted foreign companies to share with Peru 
their windfall profits from high prices for natural 
resources.  While admitting that he was ignorant regarding 
Humala's coca policy, Lerner thought it was designed by 
Hernando de Soto.  Lerner also mentioned that Humala has 
expressed interest in visiting the United States between the 
first and second round of presidential balloting.  END 
SUMMARY. 

¶2.  (C)  On March 24, the Ambassador held an extended 
conversation with Salomon Lerner Ghitis, Ollanta Humala,s 
earliest prominent supporter within the Peruvian business 
community.  Lerner is Humala,s unofficial liaison with 
business groups and has also been involved in some of the 
candidate,s meetings with foreign officials.  The Ambassador 
noted that he had requested a meeting with Humala which had 
been scheduled for March 19.  A few hours before the 
appointed time, Humala,s wife called to say that it would 
have to be postponed until Ollanta met with his political 
advisors; the Embassy had heard nothing since.  The 
Ambassador said that we were prepared to wait but it was 
looking as though there was more to the delay than campaign 
obligations, inviting Lerner s insights. 

¶3.  (C)  Lerner said that Humala is not anti-American but 
some people around him are.  They feed his paranoia.  Most 
recently, they had passed to him press articles alleging that 
the USG is financing the Human Rights groups -- particularly 
the Instituto de Defensa Legal (IDL) -- that have accused 
Humala of serious abuses against peasants in Madre Mia 
(Huallaga Valley) when he was stationed there with the Army 
in the early 1990s.  This had led Humala to conclude that he 
should not meet with the U.S. Ambassador at this time. 
Lerner also mentioned the frequent criticism of Humala by 
former Minister of Interior Fernando Rospigliosi, whose firm 
CHS receives USG funding.  The "Comandante," Lerner said, 
also was resentful over distorted statements by some 
businessmen he had met with, particularly Carlos del Solar 
who heads the Mining and Energy Society and represents Hunt 
Oil in the Camisea gas export consortium.  Humala believes 
that the campaign is about to get even dirtier because 
Lourdes Flores has just hired J. J. Rendon, who Lerner termed 
an anti-Chavista tied to Venezuela,s COPEI.  (Lerner 
asserted that Rendon is being paid by COPEI to work for 
Flores.)  In sum, Lerner concluded, Humala believes that he 
has to really watch himself in the runup to the April 9 first 
round. 

¶4.  (C)  The Ambassador said that he had seen the press 
reports alleging that we are behind the human rights 
accusations against Humala.  The source for these charges 
appears to be blogger Jeremy Bigwood, who claims that the 
National Endowment for Democracy, AID, and AID,s Office of 
Transition Initiatives finances and controls both the 
Washington Office on Latin America (WOLA) and IDL, who have 
pushed the human rights abuse charges.  Our support of NGOs 
is conducted in a very transparent way*we publicize the 
amount of grants and their purpose.  The Ambassador said that 
he was unaware of whether NED had contributed money to WOLA, 
but anyone who knows the organization would find allegations 
that the USG controls it unreal; WOLA is a prominent critic 
of many USG programs and policies in Latin America.  IDL, the 
Ambassador noted, had been a contractor for AID,s judicial 

reform program, but funding ran out for the activity last 
September.  IDL receives funding from many sources and like 
WOLA has often criticized the USG posture on issues like the 
International Criminal Court.  (Lerner interjected a comment 
here that Humala agrees with our reservations about the ICC.) 
 The Ambassador noted that he represents the U.S. Government, 
not NGOs, a Peruvian political party nor particular 
businessmen, who are responsible for their actions.  He would 
wait until Humala found it convenient to meet, but very much 
regretted that the candidate was making a decision based upon 
bad information.  Lerner said he would talk to Humala and 
suggest that he reconsider. 

¶5.  (C)  Turning to his own association with the Humala camp, 
Lerner said that he has repeatedly told the candidate that he 
does not want a position in an eventual government.  Lerner 
thought that had given him greater credibility with Ollanta, 
who recognizes that many who are rushing into his camp are 
looking for patronage.  Lerner said that he believes Humala 
is honest and reasonable, but added that Humala is untested 
and this assessment could be wrong.  There are people around 
Humala who are low quality and worrisome, Lerner said; he is 
trying to orient Humala in a good direction.  When Humala 
concludes that someone is incapable he does act decisively to 
remove the person.  Lerner,s informal role has been to 
facilitate contact between the candidate and the business 
community.  He had helped set up meetings with the National 
Industrial Society and with Spanish businessmen and was 
involved in some of the planning or facilitation of foreign 
travel.  In that connection Lerner mentioned that Humala is 
now thinking of visiting the United States between the first 
and second rounds. 

¶6.  (C)  The Ambassador asked about Humala,s call to revise 
the juridical and tax stability agreements that underpin 
large foreign investments in Peru.  Lerner said that Humala 
has repeatedly stated that he will not expropriate nor 
nationalize businesses.  He will "suggest" that companies 
which have signed tax stability agreements when oil, to cite 
an example, was 15 dollars a barrel versus its current value 
of 60 dollars a barrel either pay more in royalties or 
contribute to the development of Peru,s petrochemical 
industry.  As he did during Humala's recent meeting with EU 
Ambassadors (Reftel), Lerner implied that this would not/not 
be a big change because 85 out of 194 stability agreements 
had been modified in the past four years.  The Ambassador 
said that to his knowledge such modifications had happened 
when companies were making significant new capital 
investments.  Lerner conceded the point while adding that 
modifications had also been sought when foreign companies 
like Doe Run argued that they could not meet their 
obligations. 

¶7.  (C)  Lerner admitted that he knew too little about the 
coca issue to clarify Humala,s thinking other than to say 
that the candidate,s proposal for a huge rural/alternative 
development program is one he got from famed Peruvian 
economist Hernando de Soto.  The latter told Humala that he 
has a fully fleshed out plan that he had developed in the 
1980s.  Lerner termed "nuts" the proposal, floated by leading 
UPP Congressional candidate Daniel Abugattas, to use coca 
powder as a nutritional supplement in the bread given to 
schoolchildren. 

¶8.  (C)  Lerner said that in private conversations Humala has 
expressed firm confidence that he can eliminate the "Artemio" 
Sendero Luminoso column in 90 days.  The Armed Forces know 
where Artemio is, Humala has claimed, they just need 
determined and firm leadership to deal with the problem. 

¶9.  (C)  COMMENT:  Humala,s core group of advisors embraces 
both prickly ex-military nationalists and members of Peru,s 
old left.  Both groups harbor deep suspicions of the United 
States and are inclined to view us through a conspiratorial 
lens.  We have important substantive differences with the 
candidate on issues like the Free Trade Agreement and counter 
narcotics policies, and we work with local allies to defend 
our viewpoint.  That gives broad latitude for conspiracy 
theories within the Humala camp.  Ollanta himself is trying 
to reassure voters that he will have productive relations 
with the U.S.:  his most recent statement to that effect was 
made over the past weekend.  At almost the same time, 

however, his First Vice Presidential candidate, Gonzalo 
Garcia, responded to a reporter,s question about an alleged 
threat by Sendero Luminoso to oppose an Humala government in 
the following way:  "In the final weeks of an electoral 
process where the candidate who is supported by the United 
States Embassy is not winning, the statement of Sendero 
Luminoso appears.  This is a smoke screen, as is well known 
by all, to create fear in the electorate and seek conditions 
for a response to fear."  END COMMENT. 
STRUBLE 

=======================CABLE ENDS============================