Peru president may veto law that protects sugar industry

Peruvian president Alan García is evaluating to veto the “Oviedo Law,” reported the financial daily Gestión.

García said he might veto a law that extends protection to sugar-producing firms and suspends the planned selling of state shares in these companies.

The law was passed by Congress last week, mostly voted by government party APRA congress members, but totally rejected by Finance Minister Ismael Benavides.

“We are studying the law in order to be sure that it really helps these companies… since they will be benefitting from further state aid through this protection,” said García.

The law in debate would extend for one more year the current status which protects sugar companies from creditors. When this law was originally passed in 2003, the sugar producers were undergoing a financial crisis. Now prices of sugar-products have gone up again.

“If these companies are going to take advantage of such a law, sinking more into debts with their workers and with the tax collector entity, what is it good for?” asked García.

Congress members against this law say it will favor the Oviedo group, a business conglomerate that owns sugar companies in Pomalca and Tumán, in northern Peru.

Those that favor it, accuse its opposers of looking after the interests of the Gloria Group, according to various news sources.

Both economic groups are struggling to consolidate business in Peru’s sugar industry.

“Apparently it seem the law favors one group in particular,” suggested García.

source: livinginperu