- About bilaterals.org
- Feb-2016: New ISDS platform launched
- Sep-2004: Launch announcement
- Feb-2015: Relaunch of bilaterals.org
- Mar-2013: Relaunch of bilaterals.org
- Jun-2009: Relaunch of bilaterals.org
- Dec-2008: An update from bilaterals.org and logo design contest announcement
- Dec-2006: bilaterals.org in Spanish & French
- Sep-2006: Update from bilaterals.org
- How to participate
- Key issues
- Texts of agreements
Labor union calls out Peru over land bond dispute
Politico | 11 April 2017
Labor union calls out Peru over land bond dispute
By Adam Behsudi
The Teamsters labor union has escalated an investor dispute against Peru, arguing that its members’ pensions could be thrown into jeopardy as a result of the government’s alleged failure to pay investors $5 billion worth of debt tied up in land bonds.
“Many of our pension funds are holding defaulted Peruvian land bonds through various investment vehicles,” Teamsters President James Hoffa said in a March 24 letter to Peru’s U.S. envoy, Carlos Pareja, that was obtained by POLITICO. “We believe that America can no longer allow countries that take advantage of our large domestic market to get away with defaulting on their debts, particularly when it hurts our workers and retirees. The Teamsters union calls on the Peruvian government to make good on its responsibility to pay its debts.”
The union’s involvement in the issue is significant given that Peru’s handling of the land bonds is subject to an investor-state dispute case. The Teamsters, which opposes the “insidious” investor-state dispute process, makes no mention of the case but highlights that the 2009 U.S.-Peru trade deal “was supposed to provide legal protections for outside investors.”
U.S. hedge fund Gramercy Funds Management LLC filed a case in June under the investment rules of the U.S.-Peru free-trade agreement seeking $1.6 billion from the Peruvian government. Gramercy argues that Peru’s decision to revalue the bonds diminished their value and amounted to an indirect expropriation of its investment, among other charges. A decade ago, the hedge fund bought a large share of the land bonds issued by Peru’s left-wing military government in the 1970s as compensation to land owners after the seizure and redistribution of their property.
A Gramercy spokesman said he couldn’t disclose the identities of the fund’s clients but said the Peruvian land bonds it holds “are beneficially owned by institutional investors including approximately 200 U.S. state, municipal and trade union pension funds located in approximately 25 states.” The Teamsters represent 1.4 million workers in a broad range of industries.
Peru has said it would vigorously defend itself against what it views as Gramercy’s demand for an unreasonable rate of return on the bonds. The government says Gramercy failed to consult in good faith on the issue and accuses the fund of not participating in a special administrative procedure set up for bond holders after the government established a new valuation methodology.
A source familiar with the situation who was contacted by POLITICO declined further comment, but noted that Peru has continued to advance the bond holder process and recently set out further details on calculations and forms of payment.
"Peru is an economically stable and fiscally responsible sovereign. It is a trusted ally of [the] United States, a favorable host state for lawful investment and a trusted issuer of contemporary sovereign bonds," the government said in an earlier response to the arbitration. "Efforts by Gramercy to portray Peru as a defaulting sovereign are unfounded."
News from the movements
29-Apr-2017 Asamblea Argentina Mejor sin TLC
Encuentro de Pensamiento Crítico - La agenda internacional del gobierno de Cambiemos: ¿una integración a la medida del Foro Económico de Davos?¿Qué significa la liberalización para los y las trabajadores/as de la Argentina y para el pueblo en su conjunto? ¿Tiene importancia que la OMC venga a Argentina? ¿Cuál debería ser nuestra respuesta?
27-Apr-2017 Mujeres en la MingaNosotras las Mujeres, luchamos contra los TLC ya que estos acuerdos son más que simples reglamentaciones del comercio entre países, son estrategias de dominación de las personas.
27-Apr-2017 Forum against FTAsTrade unions, farmers groups, health activists, and other people’s movements are planning to organise a series of events to put pressure on the Government of India to withdraw from RCEP negotiations.
24-Apr-2017 GRAINTenemos por delante, potencialmente, una ola de nuevas normas de “comercio, inversión y cooperación”, y nuestra región se verá fuertemente presionada a aceptar más abusos e indefensión ante las empresas.
24-Apr-2017 USWAfter three decades of NAFTA, Mexican workers are still denied basic rights.
21-Apr-2017 Chile Mejor sin TPPSus representantes afirmaron que tratados como el TPP, el TISA y otros acentúan el extractivismo intensivo en uso de agua y atentan contra las decisiones soberanas de los pueblos respecto al medioambiente.
10-Apr-2017 Coalition Nationale "Non aux APE"La Coalition se désole de ce que des citoyens arrivent difficilement à échanger avec les autorités de ce pays sur des questions aussi importantes que les APE et la ZLEC.
7-Apr-2017 Argentina Mejor sin TLCLos pueblos latinoamericanos decimos NO a los Tratados de Libre Comercio ¡Basta de privilegios para las empresas a costa de nuestros derechos!
bilaterals.org is a collaborative space to share information and support movements struggling against bilateral trade and investment deals which serve corporations, not people. Multilingual. Global. No one owns it. Open publishing. Get involved.