Peru's premier quits after protests end in bloodshed

The Prime Minister of Peru has announced he will resign, following weeks of turmoil in which scores of police and protesters have been killed in clashes over threats to the land rights of Amazon Indians.

Yehude Simon promised to leave office as soon as he can persuade the country's parliament to repeal two controversial new laws that would open vast swaths of the homeland of indigenous tribes to exploitation by foreign-owned mining and energy companies.

In a surprise announcement, made during an interview with Lima's RPP radio, Mr Simon said he will formally resign from President Alan Garcia's government "in the coming weeks, as soon as all is calm".

It came as opposition parties criticised his failure to avert bloodshed, despite spending months in negotiations with indigenous groups worried by the proposed laws, which would dramatically increase oil and logging concessions in 67 million hectares of rainforest.

Earlier this month, 2,000 Aguaruna and Wampi Indians, many carrying spears and machetes, clashed with heavily-armed police who tried to clear them from a blockaded road near the rural town of Bagua Grande, 870 miles north of the capital. Although the official death toll is just 34, hundreds of protesters are still missing. It has been described as "the Amazon's Tiananmen" and appears to have been sparked when police fired tear gas and automatic weapons into a crowd of aggressive protesters.

Following nationwide outrage, and a one-day general strike, a curfew around the surrounding area was lifted on Monday. As a result, international agencies are now starting to arrive on the scene to investigate reports that bodies may have been burned and buried in mass graves.

Mr Simon, a former left-wing activist who was made Prime Minister in October, becomes the second cabinet member, after the populist minister Carmen Vildoso, to resign over the incident. "This is a significant step. Yehude Simon is often seen as a potential presidential candidate" said Jonathan Mazower, an expert on Peruvian affairs for the London-based pressure group Survival International. "It's doubtful, though, that in itself it will be enough to mollify the indigenous movement, which is extremely angry at what has happened, and absolutely determined not to let the protesters' deaths be in vain."

Meanwhile Alberto Pizango, the leader of the country's Amazon Indians remains at the Nicaraguan embassy in Lima, where he fled after being charged with "sedition, conspiracy and rebellion". Though recently granted political asylum in the country, he has yet to be granted safe passage out of Peru.

Mr Simon had earlier announced, during a visit to Amazon tribal chiefs, that a bill was to be submitted to parliament lifting the temporary suspension of laws barring the logging of trees in the rainforest. He said that other unpopular decrees could also be repealed.