The significance of extractives, the exclusionary properties of export-led growth and the preferential policy attention received by the Coast provide key elements to understand the nature of development and conflict in Peru. The accelerated integration into the global economy reenforced an exclusionary social structure. The modern trade pattern amplified inter-regional and center-periphery group dimensions. In turn, trade policy followed a pendulum trajectory dominated by a laissez-faire setting that favored the white coastal elites. On their road to progress, indigenous peoples became cholos on the Coast and experienced improved living conditions, but had to deal with everyday forms of exclusion. Indio became a synonym for 'backward'. The label is still used for those inhabiting the Andes and the Amazon who have not benefited from the trade pattern. The expansion of resource-intensive exports reinforces and recreates group identities, as well as intergroup gaps that shape a prone-to-conflict developmental path. © 2012 European Association of Development Research and Training Institutes.