‘Aggro’-business

President Sagasti is thrown in at the deep end as farm workers protest in Peru.

Peru’s new President, Francisco Sagasti, has been in office for less than a month but is already facing new social unrest. At the end of November, farm workers in the department of Ica began strikes and protests claiming mistreatment and poor working conditions.

As the protests gathered momentum harvests were lost and major transport links, including the Panamericana Sur highway, were blocked. As police attempted to unblock the highway, there were clashes with protesters and two protesters are reported to have died.

President Sagasti was quick to condemn the violence and immediately launched an investigation into the deaths. It is important to observe that the death of two protesters last month led to the resignation of Sagasti’s predecessor, Manuel Merino.

The protesters were demanding: 1) derogation of Agrarian Promotion Law 27360, 2) direct hiring by companies rather than being placed on temporary contracts and 3) remuneration of 70 nuevos soles.

The protesters were heard by Congress, who approved Bill No. 57596 that proposes repealing Law No. 27360. Thus, on the fifth and last day of the agrarian strike, the protesters released the Panamericana Sur highway.

We spoke to the angry owner of an agricultural business in Peru, “The government looks weak, giving in to the demands of a small group of protesters when the benefits of the Agrarian Law are well-known. The agricultural unions are also weak, they should have negotiated higher salaries rather than resorting to violence and disruption. Finally, the workers don’t know what they are doing, they should have requested greater benefits rather than the repel of a law that actually benefits them.”

“Finally, the workers don’t know what they are doing, they should have requested greater benefits rather than the repel of a law that actually benefits them.”

Owner, agricultural business, Peru

An executive at another agricultural business agreed, “The repeal of the law will actually lower the remuneration of formal workers because under the general law social security payments and bonuses, instead of being paid monthly, will now be paid just twice a year. Also, they are likely to miss their Christmas bonus as they will not have worked enough days in December to qualify.”

What’s next? According to our sources a new agrarian law will need to be drafted rapidly as there could be more protests when the workers stop receiving their weekly payments at the end of December and future payments are lower.

“The most critical problem in the Peruvian labour market is informality but a fight against the informal economy will not win votes.”

Peruvian economist

A Peruvian economist comments, “One area where agricultural workers can and should benefit is through better labour standards. At the end of the day, the most critical problem in the Peruvian labour market is informality, but a fight against the informal economy will not win votes.”

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