Prensa Latina�s wire service has reported yesterday that oil sector workers have called for a 24 hour strike starting on Wednesday March 30th over plans to privatize Peru�s state oil company, Petroperu. The workers have also demanded that all the fiscal benefits and tax breaks given to the oil multinationals operating in Peru should be indefinitely "suspended", as this amounts to unfair competition for the state company.

Petroperu contributes 11% of government revenue despite having its activities limited to refining and commercialization of derivatives in the last decade after a creeping privatization program was put into motion by the previous Fujimori administration.

The oil multinationals that operate drilling and well head operations in Peru receive tax breaks and incentives from the Peruvian government. With the price of a barrel now over 50 dollars, and bearing in mind that the average cost of production in Peru is US$8/barrel, Petroperu is obliged to pay international prices for the crude it processes and refines. This benefits multinational interests rather than the interests of the Peruvian people, and is another glaring example of the injustices imposed by multinational operators, with the connivance of flexible neoliberal-minded governments in the South American continent.

One only has to look at the environmental catastrophe left in Ecuadorean Amazonia by Chevron-Texaco and the recent struggle by the Aymara in Bolivia to protect their natural gas heritage from the unbridled greed of the U.S.-led global corporate empire.

Continental wide implications

The main backbone of South American integration is the creation of Petrosur, or Petroamerica as it is also called. This was an economic integration concept championed by Hugo Chavez to form a multi-state oil company to represent the interests of the South America nations in terms of energy, and hence a constant flow of petrodollars into the region. So far, PDVSA of Venezuela, Petrobras of Brazil and ENARSA of Argentina have signed up, with other state oil companies including Ecopetrol of Colombia, Petroecuador and Petroperu all invited.

If the wholesale privatization of Petroperu goes ahead, this will weaken Petroamerica and therefore the integration of the South American nations.

Suffice it to say, that President Alejandro Toledo of Peru, even though he is the first indigenous person to be elected to the presidency of his country, effectively sold out to US interests, as did his neighbor, Lucio Gutierrez in Ecuador. His approval rating has been as low as 6% and as high as 12% in the last two years.

The chess pieces by the US are once again being moved in an effort to undermine the true liberation of South America by "going after" energy interests as well as trying to sign bilateral trade agreements with Peru, Bolivia, Colombia and Ecuador now that the FTAA is dead in the water.

The battle for South America continues

After the defeat of gas multinational interests in Bolivia ten days ago, is it just a coincidence that Petroperu is now under threat of being handed over to the global corporate empire? I think not.

The political hue and corporate boot-licking of Uribe in Colombia and Gutierrez in Ecuador could also put Ecopetrol and Petroecuador in jeopardy as well. The strike at Ecopetrol in January 2004, effectively put privatization plans on hold in Colombia.

If you can�t defeat the plans for unity of South America head on, then take away access to its natural resources. As I have said before, the US, the State Department and the global corporate empire can never be underestimated.

We will now have to wait and see if the Peruvian oil workers can rally support from other groups in Peru to put the pressure on the Toledo regime. He has had to handle some difficult strikes during his presidency, such as last year�s teachers strike, which was settled, and in the early days of his mandate, the uprising in Arequipe province, in the south of the country, when the indigenous peoples rose up and stopped the privatization of two power plants due to be sold to a Belgian multinational.

We wish the Peruvian people well as it is now their turn to do battle with the global corporate threat to their collective interests and hope that they take inspiration from Evo Morales, the Aymara indigenous people of Bolivia and last but not least, the Bolivarian Revolution in Venezuela, led by Hugo Chavez.

� Copyright 2005 by AxisofLogic.com

You can read more analyses on events in Latin America by Carlos Herrera by going to: Articles by Carlos Herrera - 2005

Axis of Logic is also publishing his series on the rapid evolution of Bolivarian movements in Bolivia: Series on Bolivia

You can contact Carlos Herrera at: carlos@axisoflogic.com