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Economy / Peru

Peru

May 2012 | Risk Summary

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Following recent headlines of increased insecurity in Peru's coca-growing Apurimac and Ene river area, President Ollanta Humala came out and officially recognized that 'terrorist groups' were in control of the region. We argued back in early March that rising cocaine production would cause more problems for the Peruvian authorities over the coming years, and while we expect a strong crackdown on the region from the country's security forces, we believe such actions will run the risk of exacerbating tensions between the indigenous population and the government.