US embassy cable - 05LIMA5037

C O N F I D E N T I A L SECTION 01 OF 02 LIMA 005037 
 
SIPDIS 
 
E.O. 12958: DECL: 11/27/2015 
TAGS: ECON, PREL, CI, MARR, ETRD, PBTS, PINS, PE 
SUBJECT: CHILE-PERU MARITIME BOUNDARY - ECONOMIC STAKES 
 
REF: A) LIMA 4662 B) SANTIAGO 2440 
 
Classified By: Acting Economic Counselor Howell Howard. REASON: 1.4(b/d 
) 
 
1. (SBU) SUMMARY:  Aside from national sovereignty, Peru's 
main interest in the disputed waters at the Chile/Peru border 
is the area's fishery.  The approximately 14,600 square miles 
of disputed seas are rich in anchovies, but less so than 
further north, making the area probably more valuable to 
Chile than Peru.  GOP and industry contacts maintain that 
Peruvian fishermen generally keep clear of the disputed area, 
although small fishing boats do occasionally stray in the 
disputed waters. GOP officials say that while there is some 
economic value to the disputed area, political rather than 
economic motives drive GOP's desire to set its sea border 
with Chile as a southwesterly rather than a westerly line. 
The area is not currently a hot prospect for oil or gas 
discoveries.  END SUMMARY. 
 
2. (SBU) Peru's 1954 fisheries agreements with Chile provides 
for dealing with stray fishing boats using a demarcation 
latitude running west at a latitude of 18 degrees 21 minutes. 
 (Note: the 1952 maritime agreement between Chile, Peru and 
Ecuador proclaims their 200-mile jurisdiction without 
delineating borders between the three.  End Note.) If the sea 
border extended southwest from the coastal point of the 
Peru/Chile land board, perpendicular to the inverted "v" made 
by the Peruvian and Chilean coasts on both sides of the 
coastal border point, the resulting wedge of sea, if extended 
to the 200 mile frontier that Peru claims, would add 
approximately 37,000 square kilometers of sea territory to 
Peru.  (Note: the actual sea border demarcation that Peru 
proposes is a complicated calculation involving an arc from a 
reference point in Chile to a point offshore from which a new 
line to the 200-mile limit would be drawn.  End Note.) 
 
3. (SBU) The Humboldt Current flows up the South American 
coast from Antarctica to the Peru/Ecuador border area.  The 
current's churning of coastal waters results in rich sea life 
that fuels a Peruvian fishing industry that produces 12 
percent of Peru's revenues, behind only mining and 
remittances from Peruvians working abroad.  According to NGO 
and GOP sources, the current's interaction with winds makes 
for good fishing along much of the Chilean coast for only 
part of the year, while all along the Peruvian coast the 
fishery is constant year round.  The disputed wedge of sea 
that Peru seeks is in the area with constant productive 
fishing. 
 
4. (SBU) Richard Inurritegui the president of the Peruvian 
Society of Fisherman, told Econoff on November 9 that the 
disputed wedge is a rich source of anchovies, with some 
sardines, mackerel and tuna.  Anchovy is the main species 
fished in Southern Peru and Northern Chile; both it and 
sardines have cyclical populations along the coast and 
currently sardines are in decline.  Much of the anchovy catch 
is ground into fishmeal for animal feed, and there are 
extensive poultry production facilities all along the 
Southern Peruvian Coast to take advantage of the proximity of 
fishmeal plants; much fishmeal is also exported, with China a 
major importer. 
 
5.  (SBU) Inurritegui reported that Peru's central and 
northern coasts produce far more anchovies (8 million metric 
tons annually) than the southern coast (1 million).  The 
southern coast is still more productive than the Chilean 
coast further south, and Inurritegui (and NGO contacts 
separately) opined to Econoff that for this reason the sea 
wedge is more important economically to Chilean than Peruvian 
fishermen. 
 
6.  (SBU) Inurritegui noted that large company-owned Peruvian 
fishing vessels (all members of his association) generally 
stay away from the disputed wedge, and so do not have 
specific information as to potential catches. However, the 
fishing characteristics are the same, he said, as the area 
north of the 1954 line ) right up to which Peruvian boats do 
fish.  Individually owned "artesanal" fishermen do stray from 
time to time into the waters Chile claims, and there have 
always been Chilean seizures of these boats.  Inurritegui 
noted that one of the main purposes of the 1954 agreement was 
to institutionalize procedures for stray fishing boats found 
in waters claimed by each country, inevitable because of 
inadequate position finding equipment -- both at the time of 
the 1954 agreement and today in the many artesanal small 
boats.  Inurritegui said that he was unaware of any 
association members detained for fishing in the disputed 
waters. 
 
7.  (SBU) Gustavo Navarro, Director of Hydrocarbons at the 
Ministry of Mines and Energy, told Econoff on November 22 
that the disputed wedge is not an area with expected 
potential for gas or oil exploration. No oil companies have 
expressed interest in signing contracts for exploration in 
this region. While the Mollendo hydrocarbon basin runs 
offshore from Arequipa southeast into the disputed area, 
there have been few seismic surveys performed off the Tacna 
Department coast just north of the disputed areas; it may be 
worth exploring some day, but there is no reason at this time 
to suspect that the area is a rich prospect. 
 
8. (C) Despite the obvious economic importance of the 
disputed wedge, the dominant consideration for claiming the 
wedge appears to remain political.  Vice Minister of 
Fisheries Alfonso Miranda told DCM on October 19 that the 
southwesterly line is the normal way of demarcating sea 
boundaries used by the vast majority of sea borders 
worldwide.  David Lemor, Minister of Production (which 
includes fisheries), told Econoff on November 8 that while 
the disputed area is of great economic importance for the 
fish products industry, Peru is more concerned with national 
sovereignty over what it sees as its natural border.  MFA 
Director for North America Nestor Popolizio and his Chilean 
desk officer said the same thing to Econoff on November 8. 
 
9.  (C) Popolizio also pointed out that Peru faces a similar 
issue with its Ecuador border, another zone of rich 
fisheries. While the pending Peruvian legislation to set out 
its claimed maritime zone (Ref A) also includes the Ecuador 
border, the latter is a less thorny issue with the government 
of Ecuador, according to Popolizio.  (Note: Ref A explains 
the GOP's desire to ratify the UN Convention on the Law of 
the sea as an important motivator of its current legislative 
proposal to state its claim to the disputed wedge. 
Production Minister Lemor noted to Econoff that it was 
particularly important for Peru to formalize its claim to a 
200-mile jurisdiction, since it was one of the first nations 
to claim such a zone in the 1940's, along with Chile and 
Ecuador.  End Note.) 
STRUBLE 
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