final blow to the country was dealt by the International Monetary Fund (August 1986), when it declared Peru ineligible for future loans and credits, due to its failure to pay arrears on previous loans, becoming de facto a pariah of the international financial community. The result was the worst economic collapse in Peruvian history, a runaway inflation and a number of crippling general strikes. Mineral exports shrunk during the 1980s due to low metal prices and anti-export policies, introduced at a time public spending and inflation were on the rise, led to exchange rate control measures, export competitiveness deteriorated, poverty spread all through the country. Exacerbated by unemployment and hyperinflation, radical groups saw economic crisis as the ultimate evidence of the failure of market economy, and the Peruvian state. Social protests went on the rise at a time terrorist activities reached its peak, the countryside and the cities bled; as a result of global political, and economic upheavals, the 1980s are referred to as the lost decade. The arrival of a new president, Alberto Fujimori (1990-2002), not only meant the introduction of painful adjustment and stabilisation package, firmly anchored in the principles of the Washington consensus (1989). Post hyperinflation, the measures taken wiped out inflation but caused hardships, in particular among the poorest of the poor. The Peruvian military captured the Shining Path leader (Abimael Guzman) in 1992, key members of terrorist organisations were also taken prisoner, many rank-and-file members disbanded, or fled to the jungle to continue their struggle by other means. From an economic perspective, the ultimate goal was to bring Peru back to the international financial community, the signing of the Peruvian Brady Plan (March 1997) closed this chapter. As for mining, at the beginning of the 1990s, state-owned enterprises still towered high above the landscape, as time went by, Centromin, Minero Peru and Hierro Peru gained operational and managerial experience, while metals and minerals trading of local production was managed by Minpeco, by then a respected international trading house. The arrival of Fujimori also meant the unravelling of the remaining trappings of the Peruvian experiment, the next step was the sale of the assets and companies of the mining portfolio, the last trace of the entrepreneurial State. With this aim, the Private Investment Promotion Commission (COPRI) was set up in 1991, each asset was to be privatised by a separate Private Investment Special Promotion Committee (CEPRI), all of which reported to COPRI. The divestment process lasted a number of years, mainly from 1991-1998. The stabilisation measures introduced were followed suit by the passing of the Consolidated Text of the General mining Law (1992), a promotional legislation, paving the way for new mining investments, as confidence in the country was gradually restored, which in turn translated in to growing mining export volumes, compounded with a new cycle of high mineral prices until the mid-1990s, followed by a new decline (1998-2002) 130
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