Chinchero — Lost in the Clouds of Poor Engineering, Bad Finance

By Nicholas Asheshov ✐

It seems President Kuczynski is to lay the First Stone of the new Chinchero Airport in Cusco this coming week. If so, it will be the third first stone for this sad project. Presidents Toledo and Garcia have preceded him. Some locals say Presidents Belaunde and Fujimori were others. We have to hope President PPK’s stone suffers the same fate. Chinchero is a disaster waiting to happen.

This week top regulatory officials in Lima resigned in protest at the illegal contracts for the financing for Chinchero. But crooked finance contracts are the least of of what has always been a rotten project.

The Cusco city fathers say they need a new airport. This is incorrect. Their object is to grab the valuable building land of the present airport. But even if Cusco needs  a new airport, Chinchero is easily the worst of the alternatives. The Pampa de Anta, nearby, is incomparably better. Anta is dramatically lower in height and is already runway flat.

Chinchero is outside Cusco  at an oxygen-less 500ms higher, on the road to Machu Picchu.

It started off, as these projects do, with funny money. Four years ago the Cusco Regional Government, run then by ‘Humala associate Jorge Coco’ Acurio, paid $70 million for a 330-hectare string of potato fields on the rolling, cold, cloudy massif of Chinchero.

The lucky owners of the fields were the 426 members of a couple of Chinchero’s comunidades. They received $230,000 for each hectare, making them by far the most expensive potato fields in the world. You can buy a hectare of potato field in Idaho, the world’s biggest potato region, for $5,000 per hectare. In expensive southern England, in Devon and Somerset for instance, the same potato field might cost GBP 10,000, one-twentieth of the Acurio Chinchero price.

The Chinchero potato fields are good for potatoes, beans, a couple of sheep and a burro.  They make a lousy airport. Difficult in fact to find a worse location. The average height of this ancient farmland is 3,700 m.a.s.l. The only commercial airport in the world that is higher is El Alto, at 4,000 m.a.s.l., the airport for La Paz. El Alto can be used only for local one-hour , max 90-minute hops down to Cochabamba and Tarija and Santa Cruz. Arica is a ski-jump away, Lima a hop up the coast. But that’s it. El Alto never will be commercial because planes cannot take off at these altitudes with a full load of fuel and passengers.  You can have either a full tank and just a few tourists or lots of tourists and a few gallons of fuel, enough to get down the hill. In the case of Chinchero, that means Lima. As Newton said, apples fall down for free. Bolivia’s international airport is at Santa Cruz at 400 m.a.s.l. Passengers to and from La Paz to Rio, Buenos Aires, Miami and even Lima go via Santa Cruz. Check the timetables.

It will be the same for Chinchero. The bureaucrats and politicians in Cusco and in Lima, at ProInversion and the Ministry of Transport, have taken to calling it the ‘International’ Cusco airport. This is a lie propagated by the under-funded concessionaire, Kunturwasi.  Flights between Chinchero, if this idiot, foggy project goes ahead, will continue to go via Lima, as they do today and till the next century. With one difference. The tickets will cost $300 more than they do today.

Fog, hailstorms, normal in high mountains, add to the Chinchero danger. The glaciers and snowfields of the Cordillera Urubamba, at 6,000 m.a.s.l., loom over Chinchero. They are just a few miles to the north of the Chinchero potato fields. Picturesque, dramatic. Dangerous.

Technological advances in aviation are focused on electronics and nano materials. But Newtonian physics will not change, whatever the Cusqueño powerbrokers seem to think.

It could not get worse? Yes, it does.

The Chinchero massif is a limestone base. For engineers, this means sinkholes. For instance, the Inca terraces at Moray close to Chinchero at the same height, are sinkholes.  The Chinchero lakes of Piuray and Huaypo reflect the same geology. Engineering studies reflect no deep drilling to assess this risk. A 200-ton airliner will one day  land at Chinchero and open a massive instant hole. Not good.

Cusco road, sewage and electricity services are already pathetic. There’s talk, but no plans exist for new transport between Chinchero and Cuzco, nor Urubamba. Power cuts are almost daily in Urubamba, the province in which poor Chinchero is located, thanks to state-owned Electro Sur Este.

What to do with the 7 million tourists a year promised by President Kuczynski?  Machu Picchu is already at a standing-room-only 5,000, sometimes 7,000 visitors a day. A study commissioned by the government says the max daily entry cannot pass 5,400/day. Call it 2 million per year.

Cuzco thinks, says, it needs a new airport. The present one, Velasco Astete is at 3,250 m.a.s.l., 500ms lower than Chinchero, which is a big difference at these delicate heights.  Velasco Astete, run and owned by Corpac, the government airport authority, consists of 240 hectares of good flat land which could easily and cheaply have its runways extended and expanded, with new terminals and, above all, new electronics. The A219 and A320 used by Latam and Avianca can fly in on self-drive computers as they do routinely, of course, in Europe and North America where the weather, though for sure not the height, is much worse than Cusco ever is.

But the Cusco shakers, the chambers of commerce and the local politicos have other plans for Velasco Astete’s 240 hectares of land, which is only a few minutes from downtown. As building land it is worth already today $1,000/m2, $2,000/m2 before the end of the decade. Use your own fingers to work out how much this free gift of land will be worth to the imperial city’s top dogs.

In theory, the central government (all Peruvians) is owner of the land,  and indeed this is how it should be. But, no, the Cusqueños have already bought it. Under a quiet agreement with former President Humala, the $70mn it paid the Chinchero comuneros is being handed over to the central government in exchange for the 240 Corpac hectares of Velasco Astete.  Acurio was later thrown out of the regional president job by the Cusco Supreme Court for one of several instances of corruption. Acurio is one of the Humala-Heredia team being investigated by state prosecutors for corruption linked to the jailed Mr. Belaunde Lossio for thousands of millions of dollars in state construction contracts.

So Chinchero is shrouded in big money corruption, and should be stopped, investigated on these grounds alone. This apart from its technical stupidity, a characteristic of corrupt projects.

There is a good way for the Cuqueños to have their cake and eat it too. They can do the sensible thing and build a new airport on the Pampa de Anta, closer than Chinchero to their downtown and flat as a tortilla. It needs a few million bucks worth of drainage but none of the expensive earthmoving of Chinchero. Its approaches are no more dangerous than Cusco itself, better actually.

What height is Anta? Same as Velasco Astete, 3,225.

What is the Region Cusco to do with its world-record expensive potato fields, burro grazing at Chinchero? Forget it. The money has long gone on pick-up trucks and on a forest of dreadful cinderblock highrises.

Chinchero is a traditional Andean village with a fine cultural tradition in textiles, with superb views of the cordilleras reaching over to Machu Picchu. Leave it as it is. No airport means tourists will retain as fine a view as any in the Andes. The bells of the charming colonial church will continue to float out over the Inca ruins, the primary schools and the workshops of the internationally recognized weavers.

Nick Asheshov was editor of the Andean Air Mail & Peruvian Times during the 1970s and 1980s, and of The South Pacific Mail, Santiago during the 1990s.  He was Latin America Editor of Institutional Investor, New York over the same period.  He lives in Urubamba, where he writes a blog and where he has been prominent in the hotel and railway business.

This article appeared in the Peruvian Times on  January 26, 2017

Finance Tightens — Peru joins the Troubled Ten

By Nicholas Asheshov

Morgan Stanley has told its clients that its MSCI division, which monitors international markets, is preparing to downgrade Peru from EM, Emerging Market, to Frontier status.

MSCI has also expanded its Fragile Five 2013 list —Brazil, Turkey, India, Indonesia and South Africa— to its Troubled Ten for 2016, to include also Peru, Colombia, Chile, Malaysia and Singapore. MSCI says these countries have new and above-average currency risks. These countries will have increasing difficulty in covering their current account deficits, meaning that debt payments plus imports will be higher than today’s low, slow income from exports.

The party is over.

For Peru it was a good one, by far and away the best in memory. During the first dozen years of this century it catapulted Peru into a respectable new level of economic growth and management. An urban middle class expanded by millions. Poverty in the Andes dropped by millions. Pay levels and property values doubled.

But today in 2015, the rapid growth of China that helped Peru, Brazil and a score of others to flourish is finished. This was signaled last week by an initial 4.4% devaluation of the Yuan, the Beijing currency. It was this that woke up the Wall St. analysts even though the slowdown had started a year ago.

The practical effect is twofold.

One is that China is saying it will need less and pay less for oil, gas, copper, iron ore, lead, zinc, gold and silver. Second, it means that for the coming few years at least, China will be growing not at seven percent, much less the ten percent of earlier years, but more like one or two percent. This is the new normal, like the United States struggling to get higher than two percent a year, Europe which cannot get yet to one percent. China is joining them, just another shambling mammoth.

Peru, though no monster, marches to the same drumbeat. A remarkable part of the past couple of decades, here and elsewhere, is how much has changed for the good despite the weak quality and performance of the government, and the public administration. The ministries and the Central Bank have been slow and often indecisive. There is no sign that they are improving. Out in the provinces it has become seriously dysfunctional.

But this has always been a rough neighborhood. Few other countries in Latin America are any better and some are much, much worse. Brazil’s economy is falling this year as it will in 2016, in the midst of world-class corruption and mountainous mismanagement. Sao Paulo, for instance, has run out of water. Venezuela and Argentina, two of the best-endowed countries in the world, continue to sink into incoherence, apparently endemic. This is a level of political stress from which Peru has notably escaped with no sign of a turn, much less return, to the serious confusion of the 70s, the 80s and the 90s.

The most consistent measure of the perversity of today’s financial markets is in the commodities. These will continue to stay low and to sink. This is not, exactly, because the world is in recession. It is not even that demand for copper, oil, lead, zinc, tin has fallen but that it is not rising to absorb what is coming every day onto the market.

New iron ore mines and oil and gas fields and techniques have opened, paid for with cheap money. The problem is that even cheap money has a price, has to be paid for. The iron ore companies, including Vale do Rio Doce, Anglo American and BHP, have between them issued $200,000mn worth of bonds to finance mines without a market. China was supposed to buy it but is disappearing back into its Oriental mist. A part of this is the heat-hazy nature of Chinese accounting where statistics, profits, loans and taxes are spelled differently in Chinese. The same happened in Japan as of a quarter of a century ago.

Copper is in the same slow boat. In Peru, Toromocho (Chinese), Cerro Verde (Freeport M), and Las Bambas (Chinese), fine mines all, will be getting $2/lb instead of the $4-5/lb they expected just three years ago. Chile, led by Codelco, the state-owned, high-cost mammoth, has it even worse which is why it, too, is being downgraded.

Morgan Stanley says that its downgrade warning on Peru will be confirmed on September. 30 but this is a formality. It means that foreign funds will be selling their investments in companies like the Banco de Credito, Graña y Montero and Buenaventura quoted in Lima, and Peru-based companies quoted in New York and London. Many funds will be selling, too, some of their holdings of bonds issued by companies in Peru. The sums may be impressive. Between 2010 and 2013 alone, US$15,000mn worth of bonds were sold to international investors, according to Bloomberg. Peru is just a part of a bond bubble including China itself, as well as other members of the Troubled Ten.

Similar downgrades are being issued for other countries in Latin America and elsewhere. The government-backed debt of Brazil, not long ago a Wall St. high flyer, has been knocked down to a notch over junk.

This is not the case for Peru, which has just raised $2,000mn on Wall St at only 2.5% more than the rate paid by the United States Treasury. It is remarkable, looking back a couple or three decades, that loans of this size and price should have become routine, merely a note in the middle of the financial pages. The money is needed, this time, to shore up the government deficit that has appeared because of the slowdown of the economy, and they will certainly need more to fill an even bigger tax shortfall in 2016.

Another sign of homebrewed discomfort is that inflation is running strongly higher than the Central Bank’s target of 2%: it is probably higher than six percent. This week Mr. Velarde, executive president of the Central Bank, cited inflation, which he has a constitutional mandate to control, and the exchange rate as among his “growing fears.”

Peru’s Central Bank, the BCRP, and even the lame-duck Humala government, may want to take comfort from being in the same lifeboat as bigger, noisier countries. Peru is only three percent of the dollar investment to Latin America. Another way of looking at it is that Peru is being dragged down by the neighbors.

This is not going to persuade many Peruvians. They will remember that the economists at the Central Bank, BCRP, and the Ministry of Finance, the MEF, were predicting as recently as this past Christmas that Peru would be growing this year at a tear-away 5.6%.

This made no sense (PT, Jan 22 and 29, 2015) but set the scene for inappropriate policies. They should long ago have launched an emergency plan, with low Soles interest rates and a fast-track devaluation of the Sol, from S/.3=$1, as it was at the beginning of the year down to S/.4=$1, before the end of the year. This was the path taken by well-managed central banks like those of Japan and the EU, Canada, Sweden and Mexico. Instead, the Central Bank in Lima has moved the exchange rate only just a tad more than inflation, to just over S/.3.25, burning $1,000mn a month of dollars that are going to be needed 2016-2018. This is allowing bankers here and abroad to buy billions of dollars at a giveaway price. This questionable policy is why Peru has been dumped, as Bloomberg has it, into the bucket of the Troubled Ten.

Forget a recovery, even of the United States

There is no prospect that basic commodities prices will increase for years. Huge iron ore mines in Brazil and Australia will be producing at a loss. Oil will be priced at thirty-something dollars a barrel. Natural gas will be down to prices that only the huge fields in North America, Australia and the Middle East can do.

For Peru as for other third-level hydrocarbon areas, this means that the jungle oilfields and the Camisea gas fields are today, and maybe forever, worthless. They are, in today’s terminology, “stranded assets”, on the books as potential profit centers but in practice valueless.

Peru has great resources and fine prospects, in agriculture, for instance, as well as mining.

But in today’s world, Peru is nowhere for oil and gas. As part of a Peru emergency plan to ride out the recession, the government should close down Petroperu and write off the jungle gas and oilfields. Peru will be able to buy cheaper for years from Mexico, Canada and the United States.

Work on the Southern Peru Gas Pipeline should be halted immediately. This $8,000mn piece of corruption-ridden nonsense, being constructed by Odebrecht, Sao Paulo, whose chief executives are in jail for similar boondoggles at home, should be transferred to the Brazilian taxpayer.

Any expectation that the Peru economy might stay afloat is made unlikely by predictions in Lima, the United States and elsewhere that a big El Niño is beginning. Based on the experience of 1972, 1983 and 1997-8, this will subtract between two and four percent from the country’s output.

The good news is that a capable new government may take control in less than a year’s time, ready and able to turn the progress of the past several years to good account.

Published in English by the Peruvian Times on August 21, 2015.

A Spanish version of this article appears in Caretas No. 2399 under La Fiesta se Acabó

Sell, Collect your Money, or Go to Jail

Lofty principles, sacred promises, the public interest, the Constitution, and democracy itself are at stake in a heavyweight bout between El Comercio and La Republica. The dispute is about which of them should control Correo and Ojo, two of Peru’s biggest and best newspapers.

By Nicholas Asheshov

(From Caretas)

(From Caretas)

The fight is, of course, about money and power. Today in Peru, unusually, circulation is much bigger and more valuable than ever before. Peru is in the run up to a wide-open presidential election in 2016 and this is one of the first big skirmishes of the campaign.

HumalaMaquillaAmazingly, in the electronic age, Peru is a fast-growing, feisty newspaper market. Millions of unlettered 20th century families have morphed into 21st century householders and straphangers. The straw shacks of two and three decades ago are today brick and cement and not just in Lima but in Arequipa, Ica, Chimbote, Trujillo, Chiclayo, and Piura.

While The Washington Post has had to be rescued by an electronic biz kid who probably doesn’t touch a newspaper from one week to the next, El Trome El Comercio‘s zappy down-market tabloid – has tripled its circulation in just five years to 650,000. It is read by the new commuters, including the chauffeurs and maids of the people who read and advertise in the Establishment’s El Comercio. El Trome is read by one in three newspaper buyers in Peru. This is over three times more than the numbers who read the company’s flagship El Comercio (94,000) together with its less turgid stable mate Peru21 (87,000).

In Peru, each copy has a readership of perhaps four or five. The Internet has a still-low penetration of around 25%. pe_republica.750

There are, or rather were, three Big Newspaper groups in Lima. These are, or again were: El Comercio, the tough, rich Establishment leader; La Republica, the left wing group; and the Agois-Banchero group’s middle-of-the-road Epensa, featuring Correo and Ojo. Today, Epensa is just a nameplate.

In July, La Republica’s financial backer, Salomon Lehrner, had quietly arranged to buy out the Agois’ 93-year-old major Epensa shareholder, with 54%, for $17.2M, a bargain. In August El Comercio muscled in at the last minute with $18M, including an $800,000 pourboire for Apoyo, its bankers. Still, a giveaway. They got the deal.

Overnight, El Comercio’s share of Peru’s newspaper market went from around 50% to 80%, more than that of Beijing’s The People’s Daily.

Here, in this case, notwithstanding the adage to the contrary, otorongo no come otorongo, as things stand, El Comercio – more, an anaconda than a quick-footed mountain lion – has swallowed, in a single cheap gulp its only competitors, market leaders Correo and Ojo, both of them livelier and more market-friendly than its own products.

This is not good for the newspaper business in Lima. It is, in fact, a disaster. It gives the Comercio group four out of every five newspapers, and the deal would have been unhesitatingly thrown out of Anti-Trust court anywhere in Europe or North America. Anywhere, indeed, this side of Iran. Even Pravda Granma never had 80% of the market.

Correo’s market is A and B, Ojo’s is C and D. Correo and Ojo have been growing, fast. Ojo, a feisty tabloid has doubled its circulation lately to 300,000 Correo is, at 155,00 and growing, easily the market leader in the A and B level, triple that of La Republica, (45,000), the left wing tabloid.

Leaving aside for a moment the unfortunate readers, advertisers today have a choice of ONE. As Henry Ford liked to say: you can have any colour you like so long as it’s black.

Journalists who don’t see eye to eye with the numerous Miro Quesada family, El Comercio‘s patriarchal owners, will be out of luck and a job. Politicians who don’t get the nod from the Miro Quesadas will be in the same boat, offshore and heading west.

The Miro Quesadas say they will not interfere in the journalistic side of Correo and Ojo. As we used to say in Fleet Street, “pull the other one, it’s got bells on.” Rupert ‘The Dirty Digger’ Murdoch, my old employer, said the same when, in London, he bought The Times, The Sunday Times, The Sun, The News of the World and, in New York, The Wall Street Journal, among a hundred others elsewhere. Today his people, courted and employed by every prime minister since Margaret Thatcher, are being sent to jail in London for behaviour disgraceful even by Fleet Street’s flexible standards.

The Miro Quesadas are the cholo version of the Murdoch tradition, memorably cartooned as Lord Copper of The Daily Beast in Evelyn Waugh’s classic Scoop.

For decades the Miro Quesadas carried on a deadly vendetta against the big up-the-workers AAPRA party and have enthusiastically backed every golpe militar within living memory. They helped oust President Belaunde’s democratic government in 1968. Velasco’s military whipped round and nationalised El Comercio as well as the other dailies.

Belaunde, a gentleman, returned El Comercio to the Miro Quesadas the day that he returned- to the Government Palace in 1980.

Today’s El Comercio, with its bland, deviously cryptic front pages, is a well-established formula in Latin America, like the Edwards family’s El Mercurio in Santiago and their equivalents in Buenos Aires and Ciudad de Mexico. A rich, sad bunch of Little Murdochs. The Miro Quesada newspapers do a poor job of reflecting the realities of Peru, one of the world’s most varied, fast-moving, and fascinating countries.

La Republica’s journalistic tradition is a little better, but not much. It was, for instance, anti-Fujimori i.e. anti-political gangsterism. But it has been quiet about the vote-rigging, phony finances, and corruption associated with Presidents Toledo and Humala, its political friends. Salomon Lehrner, a La Republica financial angel, has been a backer of Toledo and Humala and has built up a colourfully disreputable financial reputation, outlined more than once in Correo, over the past few decades.

However, La Republica, an attractively laid out full-service tabloid, is at least livelier than El Comercio. Circulation figures show, however, that it is a poor representative of the 50% of voters who regularly place their confidence in populism, which is what’s left, as it were, of the Socialism of the long-gone 20th century. It is, in the A & B range, outsold three-to-one by middle-of-the-road Correo. It was Correo, for instance, that broke the US$50M Toledo scandal: this features a bankrupt Israeli-Peru financier Josef Maiman, with whom Lehrner has worked closely in the past. Lehrner helped finance Humala’s campaigns in 2006 and 2011 and was Humala’s prime minister for the government’s first months.

Curiously, El Comercio and La Republica are partners in the market-leading TV Channel 4, El Comercio with 70%. This has been returning annual profits of between $15 and $20M, important to La Republica’s cash flow.

Gustavo Mohme, La Republica’s publisher, is a well-established construction figure. El Comercio is associated with Grana y Montero, Peru’s top construction company, quoted since 2013 on the NYSE.

La Republica is understandably upset about losing the Epensa deal. which Lehrner had engineered through a backstreet notary in the no-go Lima district of Puente Piedra. But La Republica’s directors would never have kept their left-wing fingers off middle-of-the-road Correo and Ojo. People with a political agenda, left, right and centre are boring and newspaper readers everywhere, of course, know it.

El Comercio will surely be told by even the most susceptible magistrates. that their protestations of good faith are meaningless, even if they claim that they are nice-guy reformed characters.

The magistrates will, we can hope, crossing our fingers, tell them that they have to sell their new prize, but will tell La Republica that they cannot be the buyers.

President Humala has weighed in on the TV, saying that the purchase of Epensa by El Comercio, “an octopus,” is in every way wrong and that he is drafting a press law. Lehrner and others have chimed in but this would, as we all know, make things worse. The answer is to tidy up Peru’s well-intentioned but confused anti-trust legislation. All that’s needed is to copy the European Union legislation, already in Spanish, under which corporate fusions must be routinely cleared by the regulators, in this case Indecopi, which often works quite well.

FIN

Nicholas Asheshov, Editor for many years of the Peruvian Times and The Andean Report, worked on Fleet Street for Lord Rothermere’s Daily Mail, Rupert Murdoch’s Sunday Times and for the Financial Times, and Institutional Investor. He lives in Urubamba and in 2010 broke Orient Express’s Peru Rail Machu Picchu monopoly.

Published in Spanish by Caretas on Jan. 9, 2014

The Niños and the financial roller-coaster

By Nicholas Asheshov

Ferocious blizzards in the United States, a warm North Pole, biblical floods in Queensland and drought in northern China are being blamed on La Niña but here in Urubamba in the permanent eye, one supposes, of the Niño+Niña complex, the weather could not be more charming.

The shock pre-Niña rains a year ago which cut away big slices of the railway to Machu Picchu, have been followed this year by the traditional monsoon mixture of warm sunshine and refreshing rainfall. It’s sparkling, green and friendly, our favourite time of the year. We sense some of the mystery of the carefully-sculpted Cloud Kingdom of the Incas where dramatically chiseled rock walls controlled the rivers, the fields and the ciudadelas.

The first El Niño that gave Peru a headline role in the world’s climate drama occurred four decades ago in 1972. Newspapers worldwide published little maps showing Peru with arrows going in all directions. My sister Anna, an international skier, complained that Peru’s desert rainstorms were ruining the snow in the Swiss Alps – globalization avant le mot.

That Niño had been preceded in Peru by a famously remorseless anchoveta hunt by the brash new Peru fishing fleet led by the engaging, brilliant Lucho Banchero. Every single anchoveta from the beach breaks to the whale belt 100 miles offshore was netted. Boats would capsize and sink with too much fish. The catch was 12 million tons, one in every five fish caught worldwide that year.

The Apus struck back instantly and implacably. The dense horizon-to-horizon clouds of seabirds, the world’s greatest, have never returned. In Lima we watched thousands of starving pelicans fight for their last scraps outside the Surquillo market. The price of fishmeal, corn, wheat, sugar, cotton and soya skyrocketed on the New York and Chicago markets.

Serendipitously perhaps, OPEC doubled and tripled the price of oil to $15 the barrel. I myself moved the market. I reported to McGraw-Hill’s commodities wire on the strength of a good-humoured tip from the U.S. Embassy, then literally a stone’s throw away on Av Washington, that Arabs had come to Lima to buy copper. I practically had them mounting their camels in flowing robes at the door of the Hotel Bolivar before riding down La Colmena. The Chicago Board of Trade copper price jumped from 60 to 70 cents the pound but I was too young and poor to take advantage. In any case I had just come from Fleet St where you learn on Day One never to believe your own story.

Thus the first post-WWII price crisis. Nixon had de-pegged the dollar from gold. The oil people had no idea what to do with their billions –before that a million or two was real money– and gave it to Citibank who lent it to obscure states that even Brazilians hadn’t heard of, to Peronist bag-men and soldiers in Buenos Aires and to the Banco Popular in Peru.

Six hyper-crises later here we are again. Hundred-degree heat scorched the wheat crop last year in Russia and the Ukraine, The same economists who six months ago were gasping deflation are now fighting inflation by, of all things, reducing taxes.

So even here in Urubamba we all know that bumbling bankers, confused bureaucrats and a cascade of  Niños and Niñas have packaged themselves into a global roller-coaster, though I bet that in the Andes we’re safer than anywhere else.

Here in any case is where we stand, broad-brush, in the southern Sierra.

Four decades of figures from Senamhi, the weather bureau, show an average increase of between two and three degrees centigrade -the figures themselves are precise but it depends on the location. This is a lot. The glaciers from the Vilcabamba south to the Cordillera Real above La Paz and Lake Titicaca have all but disappeared. All you’re looking at now is a dusting of snow. The remains of old airplanes that crashed into the ice fields 30 and more years ago are being uncovered, frozen bodies of young pilots recovered and buried by their families.

A few hundred miles to the east the Brazilians continue mowing down the Amazon and Sertao, unthinkable even as recently as the 1972 widescreen Niño.

Average rainfall here has lessened, too, though the overall figures aren’t startling. But the rain now tends to come in sharp bursts, meaning there’s a lot less for farmers.

“We’re having to undo the work of decades where European NGOs brought in big, expensive cows and thirsty crops like alfalfa to feed them. Now there’s not enough water,” a Ministry of the Environment official in Cuzco tells me.

“We’re bringing back llamas and alpacas, smaller fields. We’re going back to how it used to be.”

As you might imagine, the Incas had it all clear. Their huge high-altitude polylepis –queuña— forests, now largely cut down for firewood, conserved water. Their great flights of terrace complexes made best use of it.

If I, like many of my friends, were running for President –Election Day is April 10– my Government Plan would be just four words and here they are:

Back to the Incas. FIN

Published in Caretas Magazine the week of Feb. 17, 2011

Don’t believe all you hear about lost cities. But then again, why not?

By Nicholas Asheshov

Sra. Nelly, who helps out on busy weekends, told me the other day when she heard me talking about a valley below Machu Picchu: “My cousin Alfredo knows where there’s this really big ruin. It’s on his own place, above Sta. Teresa.”

Nick's adventure as captured by Peruvian artist Carlos Christian Castellanos Casanova

I should have a double Scotch for every time someone has told me where to find buried treasure and secret ruins.

Nelly went on, looking round to see that no one else was listening. “It’s got these three lines of great walls, near the top of a hill. There’s a waterfall…”.

With lost cities and buried treasure there’s some common characteristics to the stories. One is that they are always second-hand.

The most consistently unreliable stories come from priests and protestant missionaries, invariably imprecise and gullible; perhaps it goes with the territory. The most famous in our area was a Padre Polentini, active for decades in the Lares Valley over a cold bare pass from Calca. According to everyone you meet in this attractive but little-visited area, Padre Polentini spent all his time -this would be the ’70s and ’80s– looking for lost cities and of course he built up, the same stories say, a hoard of gold and silver objects which one of the Cuzco archbishops sent off to the Vatican.

To add substance to the foggy world of lost cities and buried treasure, there’s a private museum in Lima crammed full of spectacular gold and silver objects that are all grave-robbed. It is much better than the tourist-trap Gold Museum, which is full of fakes.

A late-breaking version of the secret hoard syndrome is the story, first published in Caretas’ Country Notes in March this year, that Machu Picchu itself was looted in the 1880s by a German, August R. Berns, and all the huacos were sent off to the Berlin Museum.

The discoverer of this gem of lost city-ology, Paolo Greer, is much smarter and more persistent than the professional archaeologists and historians. One of Paolo’s specialties is locating old gold and silver mines, some of which are in production again over on the eastern slopes of the Carabaya between Cuzco and Puno. Today this is one of Peru’s toughest no-go regions, controlled by drug gangs and illegal gold panners.

Paolo has also been working on what he calls “Portuguese” silver mines to the East of Machu Picchu. He tried to get up there a few months ago but got turned back by impassable cliffs.

Others, led by Gary Ziegler, of Colorado, and Vince Lee, a couple of months ago held a symposium hosted by the Rocky Mountain Chapter of The Explorers Club. I’ve been out many times with Gary in the Vilcabamba beyond Machu Picchu and he thoughtfully combines GPS technology with ensuring that one of the mules is assigned to carry three crates of Stolychnaya with a few bottles of Martini for the women.

Technology doesn’t seem to have made the slightest difference to the rate of discovery of lost cities in the Andes.

The Instituto Geografico 100:000 maps, produced arm-in-arm with the Pentagon, are still dodgy, because they don’t do much footwork to back up the clever satellites.

However, things are a lot easier in the field today with the ferocious accuracy and handy cheapness of GPS machines the size of a telephone. This means that you can draw your own maps, as detailed or as sketchy as you like with spot-on accuracy.

But clear thinking is much more important than technology.

A few years ago a priest down in the Apurimac told me about a treasure-trove of dollars, quantities of camping equipment, a massive cache of canned food, a light bulldozer and shotguns up in the northern Vilcabamba. He added: “There’s a dozen late-model parachutes.”

I instantly realized he was talking about my own National Geographic expedition in 1963 Perú by Parachute – NGS 1964 (link to pdf of article) where, true, I’d had to abandon a couple of torn ‘chutes, a broken 16-bore shotgun and a pile of empty Coke bottles. I explained it all to the priest.

He didn’t believe a word of it.

Now I must get on with organizing a trip before the rains start to check on Sra. Nelly’s cousin Alfredo’s lost city above Sta. Teresa. FIN

Published in Caretas Magazine the week of Sept. 12, 2008

The Return of the Otter

By Nicholas Asheshov

Last Friday an otter appeared, warming itself in the morning sun on the path between the trees on the riverbank and our duck pond.

No one has seen an otter here for 30 years. I couldn’t decide whether to rush out and tell everyone or whether to keep it to myself, like when you find a new cebicheria.

The otter, which slipped into the pond with the wild immigrant ducks from Canada, was “a fish with two kinds of lungs,” Fernando, our nurseryman said, adding that it was “silvery”. That tells you how long it’s been since countrymen round Urubamba, 2,800 metres above sea level, have seen an otter on the banks of the Rio Vilcanota. Sra. Ana, our housekeeper, was less imaginative and more accurate: “It was like a cat, brownish with a flat tail, like on the telly.”

Now, we all know that the Rio Vilcanota, which runs from way up behind Cuzco and is the main river for the Sacred Valley, including Machu Picchu, is filthy, heavily polluted and getting worse. Most of the effluent, industrial waste as well as raw sewage, comes straight out of Cuzco itself via the Rio Huatanay, a tributary which is these days just a smelly ditch.

I’m surprised, for a start, that there are any fish left for an otter to eat. So we have to suppose that the fish, trout invariably, and the otter are going to the trouble of adapting to civilization. There are trout in all the cold mountain streams that bring the snowmelt down to the main river. The other day I met a 10-year-old girl and her four-year-old sister up in the Chicon valley carrying an old paint bucket with half a dozen trout between 15 and 20 centimetres long swimming around. She’d caught five and the tiny sister one, she explained, by lying on the bank and holding her hand in a pool until a trout floats into her fingers. Then she flips it out over her shoulder. In England, us kids and poachers called this “tickling” trout.

Coincidently, the New York Times the other day reported that a beaver had taken up residence in the river in the Bronx. So my Urubamba otter may not be so strange.

Otters, rather like owls, are uncommon but universal. You could find them in the marshes of the lower Euphrates, in northern Europe, all over North America and of course in the rivers of South America. There are also sea otters; there are still some left on the coast here. There have been best-sellers about tame otters, like “Tarka the Otter” and “Ring of Bright Water”.

You can still find otters in the more remote corners of the jungle. A couple of years ago the kids and I watched for half an hour a family pack of them in a lake in the Manu Park, over the hills from Urubamba. One of the older otters surfaced as we watched with an impressive two-foot fish flapping in his mouth. He nipped up out of the water onto a fallen tree-trunk a few yards from a crowd of baby otters who immediately started yapping and jumping up and down on their own tree-trunk. After a while the dad chewed down a piece of the fish and then let the cubs come and wolf down the rest of it. I was feeling quite proud of being a dad when my wife said, “I’m pretty sure that was the mother”.

What’s done it in for otters in many parts of the jungle has been the continual dynamiting of lakes and stretches of the rivers, or the use more traditionally of barbasco, a natural poison dumped into the river. Both of them kill everything around. Even though the otters themselves are probably canny enough to escape, there’s no food left for them. Today when people eat fish in and around jungle towns, it’s mostly canned atun from the coast.

I thought of popping over to the local trout farm and pouring a bucket full of fat, ready-to-eat live fish, at S/10 the kilo, into the duck pond. But in the unlikely event that this might work, I’d have been saddled with an otter family. Charming, but as much of a worry as my own kids and possibly almost as expensive.

Published in Caretas Magazine the week of March 4, 2007

 

How Calca absorbed Maotsetung’s Naked Chullo

By Nicholas Asheshov

If Lima follows Manhattan this year everyone in Miraflores and San Isidro will be wearing a chullo to work when the wet winter begins.

Thousands of people were wearing chullos at President Obama’s inauguration parade in Washington and my colleague Verlyn Klinkenborg, in a front-line dispatch to The New York Times, “Season of the Chullo” reported: “Gone is the Afghan pakol. Gone is the keffiyeh. This is the winter of the Andean hat.”

Verlyn immediately, however, puts her fashionable finger on the chullo’s only weakness: “It’s impossible to wear a chullo stylishly.”

She describes the chullo as just “a bag for the head”, briskly writing off seven millennia of Andean civilization. But she does spot a message.

“Perhaps the anti-stylishness of the chullo, its simple functionality, is its politics.” She prattles on:

“Perhaps it signals indigenousness, international-ness. But what it mostly says is, I don’t care how I look as long as I’m warm.”

Warm, simple, colourful, cheap and politically correct is a powerful combination but though gringas wear chullos and often, whatever Verlyn says, look charming in them, up here in the Andes the chullo is for men only.

Las mamachas in the markets in their keep-the-sun-off stovepipe sombreros or, on the Altiplano, their little bowlers on top of their braids or the shepherdesses in the red-and-yellow soup-plate monteras come in hundreds of variations. But girls don’t wear chullos.

What’s more, it’s men who make them. Franco Negri, the man behind La Casa Ecologica in Cuzco, tells me that the chullos he buys in Ocangate, around Ausangate, the highest Apu in Cusco, are all made by men.

“Real chullos are made by crochet knitting with five needles,” he says. “The men make the chullos and the llama-fibre ropes while it’s the women who make all the textiles with the traditional waist-loom.”

The other day, in any case, I ran into the man who has produced the defining statement of our time for the chullo. His name is Maotsetung Jimenez Dorado, a 29-year-old sculptor who has created a 2.70ms bronzed stone-cement statue of a strapping Andean Indian dressed only in his chullo and it was installed not long ago outside the bus station in Calca, a lively market town 20 minutes up the road from Urubamba.

Sited on a two-metre plinth just up from one of Calca’s two traffic lights, it has caused an uproar. “La madre de las monjitas dominicanas del Colegio Belem puso el grito al cielo, los padres de familia quejaron diciendo que “los niños se enferman,” Maotsetung told me.

“La madre dijo que la estatua es ‘morbosa’ and asked me why didn’t I do a statue of something like Heroism or Religion?”

Maotsetung, an evangelico, tells me that “the chullo es la expresion indigena de las alturas“.

His statue tells us that “los indigenas no son alienados y que son tal cual desnudos.”

Maotsetung’s statue was his graduating thesis work from the Escuela de Bellas Artes de Calca.

Maotsetung says, “I did un estudio profundo para presentarlo como obra de arte y no erotico. I even made the pene disproportionately small.”

In one hand the chullo-wearer holds apututu, the sacred Andean conch shell used in ceremonies and in the other a sort-of plaque with “Escuela de Bellas Artes” inscribed.

The statue is a reddish-bronze colour made of 500 kilos of marmolina, @ S/.1.20/kilo con cinco bolsas de cemento, mas fierros, and seis cubos de piedras para plinth/fundacion. “No me han pagado todavia para las piedras,” Maotsetung says referring to the Sub-gerencia de Obras de la municipalidad.

It took months of door-knocking, endless waiting for appointments, for Maotsetung to get the municipality to put up the statue. “Nadie le daba bola.” recalls Jean Concha, a mutual friend who works in the municipalidad.

Instead of lobbying Calca’s highland alcalde, Siriaco Condori Cruz, Maotsetung focused on lower levels like the Oficina de Educacion y Cultura de la municipalidad.No lo tomo al chico en serio,” Jean Concha says.

Maotsetung’s persistence paid off, “Pero no habia nada de inauguracion.”

Al inicio lo taparon con plastico,” reflecting the controversy that swirled through the town’s two radio stations and its markets.

Though a little weary of small-town politics, Maotsetung is hoping to get financial and official blessing for his next project which will be, naturalmente, “una ñusta solamente con su montera.

I am sending Maotsetung a suitable cheque to get the ball rolling. FIN

Published in Caretas Magazine the week of February 27, 2009