Merida Initiative—Not Plan Mexico

By Nicole M. Ferrand.*

December 6, 2007

According to The Government Accountability Office over 90% of cocaine coming into the United States now transits through Mexico. This has given rise to a huge amount of gang and criminal activity inside Mexico and along our southern border. In an effort to combat this problem, President Bush recently announced that he has requested $1.4 billion in funding over the next three years for a new security cooperation initiative with Mexico and Central America called “The Merida Initiative”.[1]

During the Merida Summit held in March 2007, Presidents Felipe Calderon and George W. Bush stated the following: “we share a deep concern over the threat to our societies by drug trafficking and other criminal organizations operating on both sides of our common border. The growing operational and financial capabilities of criminal groups that traffic in drugs, arms, and persons, as well as other transnational criminal activity, pose a clear and present threat to the lives and well-being of U.S. and Mexican citizens. The United States and Mexico will make it a priority to break the power and impunity of drug and criminal organizations that threaten the health and public safety of their citizens and the stability and security of the region… Our shared goal is to maximize the effectiveness of our efforts to fight criminal organizations so as to disrupt drug-trafficking (including precursor chemicals); weapons trafficking, illicit financial activities and currency smuggling, and human trafficking. This comprehensive two-year plan represents a new and intensified level of joint cooperation that marks a new stage in the bilateral cooperation that characterizes the strong relationship between our two countries.”[2]

Officials in both countries say the proposed aid package, attached to a supplementary funding bill, is a response to the upsurge in violence unleashed by feuding drug gangs in Mexico. There were 2,100 drug-related murders in 2006, a number already surpassed this year. Many have taken place in cities just south of the border. Those killed include gangsters, police and soldiers, innocent bystanders and journalists.[3]

The Merida Initiative will build on specific activities that aim to 1) bolster Mexican domestic enforcement efforts; 2) bolster U.S. domestic enforcement efforts; and 3) expand bilateral and regional cooperation that addresses transnational crime. Mexico will strengthen its operational capabilities to more effectively fight drug-traffickers and organized crime and the U.S. will intensify its efforts to address all aspects of drug trafficking and continue to combat trafficking of weapons and bulk currency to Mexico.[4]

This partnership would support coordinated strategies to:

• Produce a safer and more secure hemisphere where criminal organizations no longer threaten governments and regional security; and

• Prevent the entry and spread of illicit drugs and transnational threats throughout the region and to the United States.

To achieve these goals, President Bush has requested $550 million as part of a multi-year program to provide:

• Non-intrusive inspection equipment, ion scanners, canine units for Mexican customs, for the new federal police and for the military to interdict trafficked drugs, arms, cash and persons.

• Technologies to improve and secure communications systems to support collecting information as well as ensuring that vital information is accessible for criminal law enforcement.

• Technical advice and training to strengthen the institutions of justice – vetting for the new police force, case management software to track investigations through the system to trial, new offices of citizen complaints and professional responsibility, and establishing witness protection programs.

• Helicopters and surveillance aircraft to support interdiction activities and rapid operational response of law enforcement agencies in Mexico.

• Funding for security cooperation with Central America that responds directly to Central American leaders’ concerns over gangs, drugs, and arms.
• Equipment and assets to support counterpart security agencies inspecting and interdicting drugs, trafficked goods, people and other contraband as well as equipment, training and community action programs in Central American countries to implement anti-gang measures and expand the reach of these measures in the region.[5] Within three years, the package to this initiative could amount to US$1.4bn. In Mexico, the program will consist of police training. [6] It is important to point out that Mexico so far has contributed $3 billion.

Combating the drug trade and the power of the cartels is a centerpiece of the Calderón administration’s policies. Shortly after he took office in December 2006, Mr. Calderón sent up to 30,000 federal troops to several Mexican states plagued by narcotics trafficking and related violence. An estimated 4,000 Mexicans have died in the last two years as rival drug gangs have fought turf battles. The government has also extradited several drug kingpins to the US. Drug lords, for their part, have responded to the crackdown with a violent backlash against government troops, such that the war on drugs has yet to result in any decline in violence.[7]

This aid package from the US introduces a new level of security cooperation between the two countries, which in the past has often been hindered by Mexico’s strong concerns about national sovereignty. Also, the White House’s willingness to provide such a substantial amount of funding indicates that it has faith in the Calderón administration and its counter-narcotics program. The Merida Initiative should help to strengthen Mr. Calderón’s image as well as maintaining his high popularity rating. It stood at around 65% in August, according to a survey by the newspaper, Reforma.[8]

Recently, on November 5th, 2007, Mexican drug lord, Francisco Javier Arellano Felix, was sentenced to life in prison for running the notoriously violent cartel that bears his family’s name. Arellano Felix, 37, was captured after a manhunt by U.S. authorities in an August 2006 raid on a sport fishing yacht off the Baja California coast. Arellano Felix, the youngest of the cartel's seven brothers, pleaded guilty, this past September, to running a criminal enterprise and conspiring to launder money.[9]

Those crimes carry a mandatory life sentence. Arellano Felix, who has been in custody without bond at a downtown San Diego federal detention facility, is not currently eligible for any kind of parole. The Arellano Felix cartel emerged as a drug trafficking powerhouse in the 1980s in Tijuana, across the border from San Diego. The cartel was once led by seven brothers and four sisters, but Francisco Javier's brother Ramon was killed in a shootout with police in 2002. His elder brother Benjamin was jailed in Mexico the same year; federal prosecutors in San Diego are seeking his extradition to face charges in the United States.[10]

Prosecutor Laura Duffy said she does not know when Benjamin Arellano Felix will be extradited, but said she hoped it would be soon. Arellano Felix was captured during a U.S. Coast Guard-led raid off La Paz, Mexico, and towed back to San Diego aboard his 43-foot yacht, the Dock Holiday. The arrest at sea came after an intense manhunt, during which the State Department had offered a $5 million reward for the drug lord's capture.[11]

Also aboard the boat was Arellano Felix’s right-hand man, Manuel Arturo Villarreal Heredia, who pleaded guilty to racketeering and conspiracy to invest illicit drug profits. He faces up to 30 years in prison when he is sentenced in January. Since their capture, Arellano Felix’s older brother Francisco Rafael and two senior cartel capos have been extradited to the United States and sentenced on drug charges in San Diego. Arellano Felix admitted in court that he helped run the cartel as it brought into the United States hundreds of tons of cocaine and hundreds of tons of marijuana and laundered hundreds of millions of dollars. According to his plea agreement, Arellano Felix and his partners murdered informants and potential witnesses and paid millions of dollars in bribes to law enforcement and military personnel.[12]

Why people call it “Plan Mexico”?

Some critics of the program insist on calling the Merida Initiative “Plan Mexico” in allusion to Plan Colombia insisting that these two are the same. They want people to outright reject the Merida Initiative or oppose it. They insist that the name was changed on purpose from “Plan Mexico” to Merida Initiative to avoid any comparison. But in reality, there was no name change; it was never called Plan Mexico. This was an initiative born out of conversations that Presidents Bush and Calderon had in Merida, Mexico, which led to the name, the Merida Initiative with the understanding that it is a broader security cooperation package involving the United States, Mexico and Central America.[13]

Opponents use the term “Plan Mexico” so that people will immediately associate it with “Plan Colombia” pointing out that the latter has failed after seven years to curtail drug production or shipments to the US market and that the same will be the result of this program.

To the contrary, Plan Colombia has been a successful policy that has combined an effective balance of coherent macroeconomic policies, active and well-designed social programs, and, very importantly, advances made to improve security and the rule of law. In the area of security, Plan Colombia has strengthened the country’s democratic institutions and has resulted in the following conditions:

• Reduction of kidnapping cases from 1,709 in 2002 to 289 in 2006
• Decrease in homicides from 28,837 in 2002 to 17,277 in 2006, a reduction of 40.1%
• A positive impact on the war against the world drug problem. Eradication, both manual and aerial, of coca crops has increased from 61,589 in 2000 to more than 200,000 hectares in 2006. As a result coca hectares have been reduced from 163,289 in 2000 to 78,000 in 2006• Development programs have been created to provide alternative income for coca farmers. These include 784,035 families currently participating in the program Familias en Accion. As for the economy, during 2006 Colombia grew at a rate of 6.95%, the highest since 1978. The most recent figures for the first quarter of 2007 show a growth rate of 8.1%.[14]

The international press tends to refer to Plan Colombia as only a military operation, but this is inaccurate because the program is a social and political strategy to bring government presence to the country’s frontier territories and reunite them with the rest of the country. In other words, it seeks to strengthen public institutions and the rule of law in an area overwhelmed by lawlessness.[15]

Plan Colombia also seeks to fight against the drug trade, because a significant portion of the multi-billion dollar profits from drug-trafficking are funding the activities of guerrillas and paramilitaries, while thousands of innocent civilians are caught in the crossfire. A final peace agreement, probably the most important of the four main objectives of Plan Colombia, will remain illusive as long as the terrorist groups maintain an unlimited source of funding from drug trafficking.

There is a two-track approach to counter-narcotics in Plan Colombia. For the first time in Colombian history, a voluntary eradication program is being offered to all farmers who grow coca on small individual plots. If they agree to eradicate their coca crop, the government will provide them with cash recompensation and the tools they need to move into legitimate farming – such as seed, equipment and technical support.[16]

At the same time the Colombian National Police are spraying large industrial coca plantations. In reality, the so-called “military” part of Plan Colombia, is really no more than an escort service for the Colombian National Police’s activities of spraying industrial coca plantations and destroying cocaine laboratories. The only reason why this is needed is because both guerrillas and paramilitaries will fire from the ground at the spraying aircraft and fire at the Police when they enter these areas in order to destroy a drug laboratory. Counter-guerrilla or counter-paramilitary operations are forbidden.[17]

Secondly, the “Merida Initiative” is very different from Plan Colombia:

1. Mexico is free from Colombia’s large guerrilla and paramilitary forces and American aid will be relatively small. Mexico plans to spend $7 billion on law enforcement over the next three years. American officials stress that the package is testament to the growing confidence and cooperation between law enforcement agencies on both sides of the border.[18]

2. The Merida Initiative will include the transfer of equipment and technical resources, consistent with all appropriate standards in both countries of transparency and accountability of use. The strategies also include training programs and two-way exchanges of experts, but do not contemplate the deployment of U.S. military personnel in Mexico.[19]

3. Less of the military and police aid is lethal; it is almost entirely made up of transport helicopters, surveillance planes, scanning and communications equipment.[20]

4. Plan Colombia puts emphasis on fighting drugs by fumigating areas where coca leaves are grown. Mexico is not a large producer of drug crops (there is a small amount of opium poppy, and some marijuana, a crop that is already abundantly grown within the US). The focus instead is on obstructing the distribution of drugs within the Mexican territory and smuggling them to the US. It also involves going after the organized-crime figures that profit from it.

5.Mexico does have two small insurgencies, the Zapatistas (who at this point are more of a non-violent political movement) and the ERP, who seem to specialize in pipeline bombings. But the U.S.-donated equipment will not be used on counter-insurgent missions.

The bottom line On the positive side, The Merida Initiative is based on a mutual understanding between the U.S. and Mexico that the two country’s need to work together to combat the drug trafficking, gang activity and lawlessness within Mexico and along our southern border.[21] On the Mexican side critics say that until the low pay, poor organization and systematic corruption of the Mexican police forces are cleaned up, it is unlikely that this initiative will make much of a dent. They also say that one of the most useful things the U.S. could do would be to curb the flow of guns to Mexican gangs and traffickers. With a high demand for illegal drugs on the U.S. side of the border and billions of dollars reaped in Mexico as a result of it, the Merida Initiative, tough not perfect, is an attempt to reduce drug related activities in the region and bolster the security inside Mexico and the United States.

*Nicole M. Ferrand is a research analyst and editor of "The Americas Report" of the Menges Hemispheric Security Project at the Center for Security Policy in Washington DC. (www.centerforsecuritypolicy.org). She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] The Merida Initiative: United States, Mexico, Central America Security Cooperation. October 22, 2007. US Department of State.

[2]THE MERIDA INITIATIVE: A New Paradigm for Security Cooperation.

[3] Just don't call it Plan Mexico. October 25, 2007. The Economist.
[4] US Department of State – Ibid.

[5] US Department of State – Ibid.

[6] Beefing up the anti-drug war. October 25, 2007. The Economist.

[7] Beefing up the anti-drug war. October 25, 2007. The Economist.

[8] Ibid.
[9] Mexican Drug Lord Gets Life in Prison. November 5, 2007. CBS News.
[10] Ibid.
[11] Ibid.

[12] Ibid.
[13] The Mexico/Central America Security Cooperation Package. October 22, 2007. U.S. Department of State.
[14] Plan Colombia: A SUCCESS STORY. Sept. 19, 2007. EMBASSY of COLOMBIA. Washington DC.
[15] Plan Colombia: The Roadmap for Peace. Embassy of Colombia, Washington DC.

[16] Ibid.
[17] Ibid.
[18] The Merida Initiative – Ibid.
[19] Ibid.
[20] The Merida Initiative – Ibid.

[21] Ibid - The Economist.

Democrats wrong on cutting Mexican anti-drug aid

By: Andres Oppenheimer Tribune Media Services
May 13, 2008

The murder of the acting chief of Mexico's federal police amid an unprecedented wave of drug gang attacks on security officials will soon become a major issue in the U.S. presidential candidates' escalating war for Hispanic votes.Until now, Republicans and Democrats had tried to make as little noise as possible about the Bush administration's Merida Initiative, a request for $500 million to help Mexico fight its drug cartels. They hoped to pass it quietly, fearing that a high-profile debate would stir up political passions on both sides of the border and kill the proposal.But with drug war violence in Mexico escalating to record levels in recent memory, that's changing fast.

Likely Republican candidate Senator John McCain will probably try to cut into the Democrats' growing lead among Hispanics by saying that their proposal to reduce the Merida Initiative by up to $190 million amounts to "abandoning" Mexico at a time when President Felipe Calderon's government is facing a bigger than ever attack from the drug cartels.

It may be much like when McCain blamed Democrats for "abandoning" Colombia by resisting ratification of the U.S.-Colombia free-trade agreement. Only that, in Mexico's case, the political stakes at home are higher because more than 65 percent of the more than 10 million Hispanic voters are of Mexican origin.When I asked the McCain campaign Friday evening for a reaction to the Democrat majority-proposed cuts to the Merida Initiative, I got a statement from McCain's top foreign policy advisor Randy Scheunemann that sounded like the opening salvo of the coming Republican offensive."At a time when we have a Mexican president willing to take the fight to vicious narco-traffickers, it is appalling and irresponsible that congressional Democrats would cut funding," Shuenemann said. "This is just the latest example of Democrats undermining our allies."Carl Meacham, a senior Republican staffer at the Senate Foreign Relations, said that last week's killing of acting federal police chief Edgar Millan Gomez is "a huge thing." He added, "An escalating war is raging along the U.S. border, and many in Congress are refusing to assist a neighbor who has come for our help."The slain police chief was the highest-ranking of about 200 officers killed by drug trafficking gangs over the past year and a half in apparent retaliation against Calderon's military offensive against the drug cartels.According to a U.S. Senate report authored by Meacham, 2,600 Mexicans have lost their lives in police actions against drug traffickers over the past year, and the Mexican government has invested $3 billion and deployed 30,000 troops in an effort to combat the drug cartels.The Merida aid package is aimed at helping Mexico buy eight transport helicopters, improve intelligence sharing, and reduce the massive smuggling of .50 mm rifles, grenades and other high power U.S. weapons to Mexico. The plan does not contemplate the presence of U.S. troops in Mexico.Most Democrats in Congress say they want to vote for aid to Mexico, but they object to what they say is an excessive focus on military aid at the expense of institution-building assistance, and they note that some anti-immigration Republican legislators are opposing the Merida initiative.Senate Western Hemisphere subcommittee chairman Chris Dodd of Connecticut told me in an e-mail that "we are planning to provide the Mexican government with critical financial assistance, while at the same time ensuring that we can also address various humanitarian emergencies around the world."On Friday, the AFL-CIO and the United Steelworkers, which are baking the Democrats in the November elections, called for blocking the aid plan, citing concerns over human rights abuses.My opinion: In this column a week ago, I ripped McCain for moving increasingly closer to anti-immigration hawks in his party, and for leaving behind the comprehensive immigration plan he once supported to embrace a new stand that I described as economically stupid, politically unwise and dangerous from a national security point of view.Today, it's the Democrats' turn to be singled out for caving in to the populist-isolationist wing of their party, and irresponsibly turning their back to an escalating war against the bad guys on the U.S. border. Unless Democrats and their candidates give their full support to the initiative, they should face a backlash among some of the growing numbers of Hispanic voters who have flocked to the Democratic Party in recent months.

Andres Oppenheimer can be reached at aoppenheimer@miamiherald.com.

APRODEH: An NGO for Terrorists and Criminals.

By Nicole M. Ferrand.*

Do you sometimes wonder why we mostly hear about non-governmental organizations (NGO’s) when members of criminal or terrorist organizations are in trouble? It’s rare to read about these associations openly supporting real victims, especially in Latin America. So it was a breath of fresh air to come across the excellent article by Mary Anastasia O’Grady from the Wall Street Journal on April 28, 2008 titled “Friends of Terror in Peru” where she points out “Terrorists can advance their cause with the help of non-governmental organizations and under such headings as “human-rights” advocacy, NGO’s that share the ideology of the far left try to legitimize their buddies who, behind the scenes, continue their “armed struggle.” The kicker is that these NGOs are often funded by foreign governments and philanthropists.” Ms. O’Grady’s column is insightful and clearly shows that she understands the dynamics of the left, terrorism and non-governmental organizations in the Americas. Here is the link to her article and video interview:
http://online.wsj.com/article/SB120934263440048541.html?mod=googlenews_wsj.

With the downfall of communism in Eastern Europe, leftist movements were thrown into a temporary identity crisis. They sought to recycle themselves, forming and strengthening human rights and ecological nongovernmental organizations (NGO’s), receiving considerable funding from mainly Western European leftist counterparts. In practical terms, the new NGOs filled the vacuum created by the fall of the leftist parties. Skillfully and patiently networking their efforts to promote these issues, these associations have produced a reemergence of the left. In fact, a high ranking diplomatic official once revealed: “When leftist leaders or groups start making trouble in our countries, we send them to Latin America, to run an NGO.” NGO’s have become a major factor in international relations. There are many organizations that call themselves NGO’s, but are basically a bunch of people, who are mainly interested in making a profit off foreign aid. There are many problems with NGO’s, and these problems are now becoming more visible to the public.

In their recent meetings on April 25, 2008, the European Parliament agreed to remove Peru’s Túpac Amaru Revolutionary Movement (MRTA) from its list of terrorist organizations. A letter sent on April 23 by the Peruvian so-called “Human Rights” Association (APRODEH) argued that the Marxist-Leninist MRTA no longer exists and their argument was accepted. Why is this NGO sending a letter to the European Parliament without consulting the pertinent Peruvian authorities? Are they 100% sure that this group no longer exists? To the majority of Peruvians, this action shows that APRODEH and the majority of non-governmental “human rights” organizations are defending terrorists and insulting the armed forces that fought the terrorists who murdered thousands of innocent civilians, including women and children, and severely injured members of the armed forces and police.

As described by Ms. O’Grady “the vote by the European Parliament to take the MRTA off its terrorist list has Peru in an uproar. For good reason: The MRTA is notorious for kidnapping, torturing and murdering civilians to advance its political agenda. More recently, Peruvian officials have linked it to Hugo Chávez’s ‘Bolivarian Movement,’ which seeks to destabilize democracies in Latin America, and to the Colombian rebel group FARC.” In fact Ms. O’Grady interviewed Peruvian Congressman Rolando Sousa, who headed a congressional subcommittee that looked into the activities of the Bolivarian Movement in Peru and what she reveals of this interview is quite alarming. Mr. Sousa says that “Mr. Chávez’s Bolivarian Movement sits on a three-legged stool. Two of the legs are legal, the third is not. The first leg is official Venezuelan ‘diplomacy.’ Discounted oil shipments have bought the allegiance of 19 countries in the region. Other ploys, such as the purchase of Argentine debt and aid for Ecuadorian energy projects, are likewise designed to create dependence and establish Venezuelan dominance.”[1]

Peruvian Congressman Rolando Sousa. Source: 24 Horas Libre.

s. O’Grady continues: “The second leg of the stool is the effort to establish ideological control within unions and grassroots organizations. These organizations have created a series of nonprofit “associations” like the “Houses of Alba” (Bolivarian Alternative for the Americas). Openly, the associations administer eye clinics, literacy programs and health centers manned by Cuban doctors. Behind the scenes, the congressman warns, they work to indoctrinate the poorest Peruvians in the ideology of the extreme left.”[2]

The third illegal leg of the stool is the most dangerous. Mr. Sousa cites two groups: the “Continental Bolivarian Coordinator” and the “Bolivarian Congress of the People.” His committee found that both are recruiting and using the most extreme elements of the country, anarchists, terrorists and the radical left, to produce “the social conditions . . . the chaos” necessary to create the impression that democracy is not working. Once this is accomplished, the grassroots organizations, nurtured by the NGO’s, are standing by, ready to bring the extremists to power through the ballot box. The strategy was used in Bolivia to bring down the Sánchez de Lozada government in 2003 and bring Chávez puppet, Evo Morales to power. There is now ample evidence linking Mr. Chávez, the mastermind of the Bolivarian Movement, to terrorism, courtesy of the computers seized from the camp of dead Colombian guerrilla, Raúl Reyes.”[3]

Letter from Aprodeh to the European Parliament
The letter from APRODEH, signed by its leaders Francisco Soberón and Miguel Jugo, says that “the MRTA has been inactive for eight years, its main leaders are in prison, some have served their sentences, and dozens are no longer linked to the organization, and are living in many different places around the world.” Their claim is misleading, to say the least. Just enter the website, http://www.voz-rebelde.de/texto/noticias.htm to see that the MRTA is very much alive. As Aldo Mariátegui, Director of the newspaper, Correo in Peru accurately points out: “The arguments of Aprodeh and of the European members of parliament who backed the decision not to include the group in the list of terror organizations is absurd, brittle and an insult to intelligence. Aprodeh argues that this group should not be included in the list “because it’s inactive.” So the crimes the MRTA committed are not considered as such in Europe because the group is, for now, inoperative? With that logic, the Europeans should not consider the German group, Baader-Meinhoff, or the Italian organization, Red Brigades, (Brigate Rosse) as terrorists because they have not operated since 1993 and 2002 respectively. And what about the active networks that the MRTA still has in Europe?[4]

The reality is that this group still has sinister plans for our country (Peru) as we have been warned by members of our armed forces (Roque González, a MRTA member was recently detained in Tumbes, a northern province, for attending a meeting of radical groups held in Quito. Other attendees were the FARC and ETA. It has been reported that at this “gathering” they coordinated violent actions to be carried out in different countries including Peru.) Why was Aprodeh so worried about the MRTA being considered by the European Parliament as a terrorist organization?[5]

Six people were arrested in Peru together with Roque González upon returning from Ecuador. They have been charged with terrorism for having attended a meeting of the Bolivarian Continental Coordinator, a Venezuelan group that is considered by Peruvian authorities as a terrorist organization. Peruvian authorities say that the seven attended the meeting to receive instructions from violent leftist groups, such as the Revolutionary Armed Forces of Colombia (FARC), on how to destabilize Peru. FARC commander Raúl Reyes reportedly attended the meeting.

What is APRODEH?
Aprodeh is a self-proclaimed “human rights” organization registered in Peru as a Non-Governmental Organization (NGO). It was founded in the ‘80s as an appendix of the leftist political party “Vanguardia Revolucionaria” (VR) or “Revolutionary Vanguard” whose leader was Javier Diez Canseco Cisneros. In those times the VR operated from the offices of Diez Canseco, a representative of the political party “Unidad Democrática Popular” (UDP), or “Popular Democratic Unit,” formed by the VR, the Movimiento de Izquierda Revolucionaria (Movement of the Revolutionary Left, of whom one of its members was former MRTA terrorist Victor Polay Campos) and the “Partido Comunista Revolucionario,” PCR (Revolutionary Communist Party).[6]

Javier Diez Canseco is a fervent leftist politician and former Congressman. He was among the 38 men who were released very shortly after the hostages were taken from the Japanese Ambassador’s residence in 1996 by the terrorist group ‘Movimiento Revolucionario Tupac Amaru (MRTA). He openly defended this and called for the government to negotiate a settlement.

The Director of Aprodeh is Francisco Soberón, also President of the National Coordinator of Human Rights. In the ‘80s, Soberón was an adviser to Congressman Diez Canseco and was also a member of the Central Committee of the Political Bureau of the Revolutionary Vanguard. It is legal for a political party to promote an organization of human rights but the problem was that the VR was not only a political party but an organization of Marxist ideology and Leninist structure whose goal was to take power by means of an armed conflict. The “Revolutionary Vanguard” had a legal team and a military clandestine subgroup which was in charge of training future members of the so-called ‘Revolutionary Army.” Why did a political party with these characteristics need to create a pro-human rights NGO? It is inexplicable since Diez Canseco and Soberón wanted to impose an absolutist anti-democratic regime.[7]

From the political perspective of the VR, Aprodeh had a clear role in the “legal realm” which was to denounce the “repression of the bourgeois state” and accuse the government of human rights violations, to neutralize it and limit its response capacity when the moment of the “armed conflict” came. This is an old discourse of subversive groups. The terrorist group “Shining Path” gave this duty to the “Asociación de Abogados Democráticos” (Association of Democratic Lawyers) and the “Asociación de Familiares de Víctimas de Genocidio” (Association of Families Victims of Genocide).

Who Funds Aprodeh?
In 2007, according to government records, Aprodeh received funding from Oxfam America, George Soros’s Open Society, the John Merck Foundation, the city of Barcelona, the Dutch embassy and a U.S. government agency called the Inter-American Foundation, among others. Last week, the Peruvian government asked Aprodeh to explain how its NGO status allows it to intervene on behalf of terrorists, as it did in the European Parliament.[8]

Sadly for now, Aprodeh has been successful in their goal to diminish the power of the Peruvian armed forces which can no longer freely fight terrorism since its members continue to be persecuted by judges and prosecutors who have been convinced by Aprodeh and other NGO’s, that the military and the police are murderers while the terrorists are let out of jails labeled as “social fighters and victims of the state.” In fact, Gloria Cano, an Aprodeh director, represented four Chilean MRTA members as their lawyer. It is this same organization that is the main promoter of the judicial persecution against the brave commandos of “Chavin de Huantar” who successfully rescued the hostages from the Japanese ambassador’s residence in 1997. Aprodeh never believed in the democratic system but takes advantage of it to protect the terrorists and neutralize the armed forces.

We need to keep in mind that the foreign employees of NGOs are infused with a certain degree of idealism. On the other hand, the locals that work with them are often leftist fanatics for whom this is their only way to make a living. They use the radical left’s double standard, which excuses terrorist atrocities but holds democracies strictly accountable for any defensive actions they take to defend themselves. The members of these associations should be made accountable and respond to the law just like everyone else. The Peruvian Congress is now investigating Aprodeh and their actions since the Peruvian people are outraged by what happened. If Aprodeh did break the law by lobbying on behalf of the MRTA then they must be held fully accountable for what they have done and their deeds exposed. Administrative sanctions should be applied and their license revoked according to the law. Aprodeh is supposed to be a Human Rights association and there is plenty to do in a poor country like Peru.

Analysts agree that the reason for Aprodeh’s action is to legitimize MRTA so that its members can run for political office and they can be viewed as a legitimate opposition party instead of a terrorist organization. This was Chavez’s aim at trying to have the FARC removed from the terrorist list. If it is not designated as a terrorist organization, then it can be potentially even more effective in working to bring down the Uribe government. Instead of writing letters on behalf of terrorists, why didn’t Aprodeh create programs to help people, such as providing aid to the real victims of terrorism, or to the victims of the earthquake that shook Peru in August? NGO’s should be fully investigated and the sources of funding disclosed to the public so that no hidden agendas are carried out in the name of ‘human rights.’

Nicole M. Ferrand is a research analyst and editor of “The Americas Report” of the Menges Hemispheric Security Project. She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] Friends of Terror in Peru. April 28, 2008. The Wall Street Journal. By Mary Anastasia O’Grady.
[2] Ibid.
[3] Ibid.
[4] Clausuren Aprodeh. April 24, 2008. Diario Correo, Perú. By Aldo Mariategui.
[5] Ibid.
[6] Aprodeh. By Víctor Robles Sosa. May 3, 2008. Políticamente Incorrecto.

[7] Ibid.

[8] O’Grady – Ibid.

Paraguay’s New President, Fernando Lugo.

By Nancy Menges* and Nicole M. Ferrand.*

Paraguay is increasingly considered of great geo-political importance to the United States due to its borders with Brazil, Bolivia, Argentina and Uruguay, whose governments are frequently critical of some aspects of U.S. foreign policy. Significantly, Paraguay also shares part of the so-called “Triple Frontier” with Argentina and Brazil, an area under suspicion for possible involvement in drug trafficking and terrorism.

Map of the Tri-Border region between Paraguay, Brazil and Argentina. Source: Abovetopsecret.
Hezbollah, Hamas, Colombian extremists, Chinese Triads, Russian Mafia groups and Al-Qaeda operate in this area. In Ciudad del Este, Foz do Iguaçu and Puerto Iguazú which is located in this area, the illegal activity is immense. The turnout for the region is roughly estimated at more than 20 billion dollars annually.

Facts about Paraguay
Paraguay is a poor, landlocked country of 5.6 million people in the heart of South America. According to Paraguay’s Secretary of Technical Planning, 38 percent of the population is unemployed or under-employed, and half of the country lives in poverty. Paraguay’s Colorado Party is the world’s longest-ruling party still in power. The Colorado’s have governed for more than 60 years, backing the 35 year long dictatorship of General Alfredo Stroessner from 1954 until he was overthrown in 1989. A transition to democracy began that year but every President in office since has been investigated for corruption. The world’s fourth-largest soybean exporter, Paraguay relies mainly on agriculture and hydroelectric power. However, the underground economy includes contraband in drugs and weapons.[1] The US Government has warned of money-laundering and terrorist financing in the tri-border area, where Paraguay, Argentina and Brazil meet near the Iguaçu waterfall. Paraguay is also a major smuggling center, known as a transit point for weapons and drugs.

Political violence has tarnished Paraguay’s recent history, with military coup attempts in 1996 and 2000. Paraguay’s business freedom, labor freedom, property rights, and freedom from corruption are weak. Opening a business is difficult, and regulations are enforced by an opaque bureaucracy. The government significantly influences the rule of law, and corruption is widespread. Because of endemic judicial corruption, protection of property is extremely weak, while restrictive labor regulations hinder employment opportunities and overall productivity growth. The unfavorable business environment has been a major deterrent for foreign investors and has placed Paraguay amongst the countries in Latin America receiving the lowest rates of foreign direct investment.[2]

The President – elect: Who is Fernando Lugo
Fernando Armindo Lugo Méndez was born on May 30, 1951 in San Solano, San Pedro del Paraná, district, in the Itapúa department, Paraguay and became a priest in 1977, serving as a missionary in Ecuador for five years. In 1992 he was appointed head of the Divine Word order in his native country, was ordained a bishop in 1994, and then served for 10 years in the region of San Pedro. There, his support for landless peasants earned him the reputation of being “the bishop for the poor.” The more conservative Catholic Church leaders accused Lugo of betraying the church’s supposed non-political role in Paraguayan society while the more moderate and progressive churchmen rapidly rallied to his support.[3]

Bishop Fernando Lugo came to national prominence in March 2006 when he helped lead a rally against the government in the capital, Asunción. He resigned from the priesthood in December, 2006, but the Vatican refused to accept this, arguing that serving as a priest was a lifetime commitment and instead suspended him from his duties. The Paraguayan constitution prohibits ministers of any faith from standing as a political candidate. However, Mr. Lugo headed a coalition called the Patriotic Alliance for Change, made up of several parties and organizations and became a candidate for the presidency. Lugo defeated the Colorado Party candidate Blanca Ovelar in the presidential elections on April 20, 2008, breaking the Colorado’s sixty one year grip on power. He is associated with the Socialist International through the APC-coalition’s Revolutionary Febrerista Party.[4]

According to the Christian Science Monitor, Mr. Lugo’s opponents have painted him as Latin America’s newest leftist candidate, sure to follow in the footsteps of Venezuela’s Hugo Chávez or Bolivia’s Evo Morales. While he does favor center-left policies – something that plays well with pockets of society here – his main draw comes from having no political attachments in a nation rife with corruption. Lugo himself refuses to be pigeonholed as part of the left-wing trend in South American politics. “There are people on the left who say I am from the right. There are people on the right who say I’m from the left,” Lugo says. “I am a person of the center who has a certain distance from left and right, but with the capacity to unite both.” His opponents have warned that he will imitate radical leftists elsewhere and claim that there were reports of Venezuelan and Ecuadorian agitators, posing as election observers, who created chaos and committed acts of violence on Election Day. [5]

Fernando Armindo Lugo Méndez, Paraguay’s President-elect. Source: El Pais.

His proposals include reassertion of national sovereignty in the utilization of energy, opposition to the immunity of U.S. troops in Paraguay, and the possible naming of a woman as vice-presidential candidate. (President Nicanor Duarte Frutos and the Paraguayan Congress authorized immunity for U.S. troops operating in the county, as part of joint military exercises). The U.S. military presence in the area has been interpreted by some as a maneuver to monitor the Triple Frontier area, often accused of housing suspected Islamic terrorists. Due in part to popular opposition, the military immunity agreement will probably not be renewed. He also promises to redistribute income and undertake land reform. The political class is wary of him, but Lugo has broad support among the country’s poor, who were drawn to his populist rhetoric about the evil rich and the promise of property to all of the country’s landless peasants. The fact that the land has to be taken from somebody to redistribute could be a very troubling sign, if we consider that Chavez and Morales did exactly that. [6]

In addition, the new Paraguayan president may clash with neighboring Brazil, as his campaign platform included a pledge to get this country, Latin America’s biggest, to pay more for the energy it imports from the jointly owned Itaipu hydroelectric plant, located on the border between the two nations. Analysts have warned that Paraguay must learn from the Bolivian experience: Paraguay, as Bolivia, can’t consume all the energy they produce and given its landlocked geography can only sell it to Argentina and Brazil.

His victory represents a break with the political tradition of Paraguay, where the Colorado Party had ruled for 61 years. The Colorado’s have ruled for six decades so there are generations of people who have not known any other reality. No single party will dominate the country’s congress, so Lugo will have to make deals with other groups. Some people are preparing for the worst and firmly believe that Lugo could become a dictator like Chávez.

Chavez’s reaction might give us a clue. After Lugo’s victory, the web site of the Bolivarian Republic of Venezuela read: “President Chavez congratulates the new president of Paraguay, Fernando Lugo” saying that Chavez wanted to have a “friendly telephone conversation” to congratulate the new President-elect. Chavez referred to Lugo as “brother” and praised Paraguay for its “political maturity.” Lugo, who takes office August 15, 2008, is called the “Red Bishop” by foes. Chavez’s site continued to say that both he and Lugo were eager to “meet as soon as possible” to make plans for their “cooperation.” Lugo expressed the same sentiments about Chavez. Ecuador’s president Rafael Correa was just as happy about Lugo’s election saying that the “the triumph of comrade Fernando Lugo is yet another stone in the foundation of this new Latin America that is just, sovereign, independent and, why not, socialist.”[7]

Relationship with Chavez, Correa, Morales and Ortega
US officials have voiced concern about our diminishing influence in Latin America after apparently another country in the region fell under the influence of Hugo Chavez. While the Paraguayan President-elect has repeatedly denied any alliance with the Venezuelan President, Lugo is expected to benefit from lower priced oil from Venezuela. An official at the US State Department said that Mr. Lugo’s victory had left Washington worried about its waning influence in Latin America, where Nicaragua, Ecuador, Bolivia and, to a lesser extent, Argentina have joined Cuba in declaring their loyalty to Mr. Chavez.[8] The outgoing President, Nicanor Duarte has worked closely with the US government, which is concerned about the financing of terrorist groups in Paraguay’s Ciudad del Este region, which hosts a large Arab population allegedly with links to Hezbollah and Al-Qaeda.

Conclusions
While we won’t know Lugo’s true colors until August 15th when he formally becomes President of Paraguay, some analysts assert that his victory signals a continuing left-wing shift in Latin America and that Mercosur, the regional Latin American trade group between Argentina, Brazil, Uruguay and Paraguay, plus associate countries Chile and Bolivia as well as Venezuela which is in the process of joining, is now mostly made up of leftist leaders. Up to now, Lugo is showing signs of wanting to distance himself from radical leaders such as Chavez and Bolivia’s Morales.

From a security standpoint, documents reveal that there are illicit networks that supply substantial funds to Middle East terrorist groups. Intelligence experts have been warning since the late 1990s that they had noticed a tendency among Islamic terrorists to operate from Paraguay. Financial terror cells operate in the country for the purpose of supporting terrorist groups such as Hezbollah and Hamas. The current government has been cooperating with the United States on this front and it is imperative that this effort continues.

There will be a great temptation for President-elect Lugo to join the Chavez camp as he takes the reins of a small impoverished country with weak institutions and a poorly functioning economy. He also has no former experience in the affairs of state. Chavez will try to woo him with economic handouts and cheap oil. Yet we will have to wait and see if he wisely follows the right path and chooses what is best for his country. He doesn’t need to look far to analyze the disastrous political and economic situations of Venezuela, Bolivia, Nicaragua and Ecuador. He can implement successful policies similar to Brazil’s Lula and Chile’s Bachelet. Instead of nationalizing and closing Paraguay’s economy, he should privatize and aim at open markets. Let’s hope that Lugo understands that Paraguay’s poverty is not due to capitalism but to the lack of a free market economy.

*Nancy Menges, Editor in Chief of the Americas Report. Mrs. Menges, the co-founder of the Menges Hemispheric Security Project, is in charge of the weekly edition of CSP’s Americas Report. She holds a degree in International Relations from the University of Wisconsin-Madison and has studied at the University of the Americas in Mexico City. Her postgraduate degree has been earned from the University of Maryland.

*Nicole M. Ferrand is a research analyst and editor of “The Americas Report” of the Menges Hemispheric Security Project. She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] Former Catholic Bishop Enters the Political Arena. February 22, 2008. WorldPress.org.
[2] Paraguay winner means more leftist leaders in Latin America. April 21, 2008. Mercury News.
[3] ‘Red bishop’ Fernando Lugo wins Paraguay election. April 22, 2008. The Telegraph.
[4] Facts about Paraguay. April 20, 2008. Reuters.
[5] Index of Economic Freedom: Paraguay. 2008 The Heritage Foundation.
[6] Paraguay election: Key candidates. April 17, 2008. BBC News.
[7] Ibid.
[8] Paraguay could shift left in Sunday’s presidential polls. April 18, 2008. Christian Science Monitor.

Peru: Iraqi – US Smuggling Ring Discovered.

By Nicole M. Ferrand*

This past July, a criminal ring attempting to smuggle Iraqis into the United States was discovered in Peru. The drama began on July 21st when three Iraqi siblings, two men and one woman, arrived at Jorge Chávez International airport in Lima and bought three tickets to travel to Los Angeles, California. They were planning to board a LAN Chile flight carrying German passports. Their names: Nader Yusef-Adib, (21), Nasim Yusef-Adib, (23), and Lina Yusef-Adib (33).[1]

When they were passing through security, they presented boarding passes bound to Santiago, Chile instead. Apparently, what happened is that in the waiting room they switched their boarding passes to avoid the scrutiny that passengers go through when traveling to the U.S. Airport officials scanned the woman’s passport and discovered that it was fake. She requested to go to the restroom and that is when a female worker discovered Ms. Lina destroying the boarding passes and other documents and contacted the police. Using a translator, they said they had arrived in Lima from Brazil where they had traveled after leaving Iraq two days prior. “The suspects said they wanted to go to the United States to work because the situation in Iraq is very difficult. We have requested the help of the Directorate Against Terrorism (Dircote), they are working on the case,” were the statements of the Chief of the Directorate of Criminal Investigation.[2]

Peruvian officials contacted German authorities and found out that the passports had been stolen from three German nationals: Matthias Becker, Meike Barth and Diego Amson. Local authorities learned that another group of Iraqis had been en route to the airport. “The others were slowed by traffic on their way to the airport,” Coronel Roberto Luján said. “When they arrived, they apparently saw what was happening and left.” Peruvian police are checking for possible connections to international terrorism networks and the suspects are being charged for lying to immigration officials and using false documentation. US Intelligence officials were soon contacted and arrived in Lima to investigate the case.[3]

Not even a month after this incident, Peruvian intelligence units spent several days watching an individual by the name of Mr. Pati and others thought to be part of the smuggling ring. Early in the morning of July 17, 2007, police in Lima raided three luxurious apartments in the upper scale district of Miraflores. They found six Iraqis with fake Dutch passports. No weapons were found on the premises but authorities alerted the US embassy asking for help in the investigation. The names of the people involved are: Mushtaq Yhana (25), Loay Elda (29), Adelmika Homow (61), Salema Kalzeak (53) and the brothers Danik (26) and Nail Mansour (29).[4]

Col. Luján, the official in charge of the raid and the case, stated that the leader of the criminal ring that smuggles illegals into the United States is Iraqi citizen, Rafid Jaboo Pati (40). According to Mr. Luján, Mr. Pati had the responsibility for the Iraqis who had arrived in Lima from Ecuador, Costa Rica and the Dominican Republic with the intention of smuggling them into the United States. The suspects stayed in lavish locations while other members of the ring falsified the Dutch documentation in order for them to travel to Miami, New York, San Francisco, New Orleans and other US’ cities.[5] Rafid Jaboo Pati was captured in Miraflores, Lima with an Ecuadorian passport and identity card from the same country. Pati confessed that the other six Iraqis had arrived in Lima 25 days earlier.[6]

The seven people are currently being held by Peruvian immigration officials, Lujan added. Police also seized a laptop, a cell phone and other false documents, including an Ecuadorian driver’s license and fake Dutch, Ecuadorian and Iraqi passports from one of the apartments. “We’ve sent their fingerprints to Interpol headquarters in France to find out if they are wanted by the international police,” said Col. Luján. He said the seven had been under police surveillance since they entered Peru illegally by land from Ecuador 25 days ago.[7]

“Peru has a growing problem,” a U.S. official said. “It has become a center for people trying to enter the United States illegally.” Peruvian police became suspicious when it was determined that none of the Iraqis spoke Dutch or German. For now they will be charged with falsifying documents.[8]

Mr. Luján has said that the three Iraqis caught in the airport and the seven others seized in Miraflores are part of the same group under the leadership of Rafid Jaboo Pati. An 11th person was not in the apartment at the time of the raid and is at large, officials said. “The Iraqis refused to give the name of the missing individual,” “We have been told by Interpol sources in Lima that fingerprints of one of the men carrying a Dutch passport have been sent to Baghdad and is thought to have links to al Qaeda,” Col. Luján said, adding that he could not identify the man for security reasons.[9]

Lujan rejected a theory that the men could be Chaldean Christians, a group said to frequently attempt to enter the United States on claims of religious persecution in Iraq. “These people were not part of that group,” he said. “Besides the brothers, they did not even know each other.” One man was arrested while clutching a flag of unknown origin.[10]

Analysis
Telling Peruvian officials they were on their way to Chile and not the United States is what raised suspicion and led to their incarceration but there are many questions surrounding this bizarre incident. First, did the three that were caught in the airport buy tickets to both Chile and the United States which resulted in them having two different boarding passes? Secondly, this must have been a very well financed and orchestrated operation: where did they get the funding to travel to Brazil, then Peru and while there have cash for expenses? It is evident they had plenty of money to buy six tickets, three to Chile and three to the US. Then there are the added operating costs of having a contact and leader, Rafid Jaboo Pati, who made arrangements for their accommodations and prepared their false documents. Were they buying tickets to different destinations to obtain different boarding passes to mislead authorities and illegally enter the US? Maybe other Iraqis did this before successfully. Returning to the money issue, if they say they were en route to the US to find work because of the harsh conditions in their country of origin, where did they get the money to do all this?

Were the seven others caught in the luxurious apartments the ones that were to travel together with the three siblings and when they saw that something was wrong in the airport, decided to run away? Dutch and German citizens do not require visas to enter the United States, but if Peruvian authorities discovered the passports were fake, in the US they would have been surely caught. If those arrested were Iraqi Chaldean Christians who frequently try to enter the U.S., claiming they face persecution in Iraq and California is home to a sizable Chaldean community, why make false statements and destroy documentation at all? What were they trying to hide so desperately? They could have contacted the Chaldean community in the United States to get help.

Many Iraqis who try to get to the US have to find different routes to get to their destination. These individuals were caught in Peru but there must be other rings similar to this one operating in different countries. They may be trying to use countries that are U.S. friendly to avoid raising suspicions. Also, there is the issue of picking countries that are perceived as lax regarding security issues. It might be the case that some might be trying to find a better life, but that might not be true for everyone.

Every year, hundreds of thousands of people try to come to this country seeking better opportunities. Some go through the regular process and get rejected and some have better luck; some cross the Mexican or Canadian borders illegally; but this case is bizarre because of its complexity and for the availability of monetary resources at hand.

Peru handled this case in a very professional manor; identifying the problem, immediately beginning an investigation and seeking international cooperation to arrest the suspects. However, it still is not known what the true intentions of the Iraqis were other than their desire to enter the U.S. Hopefully, through the cooperation of the Peruvian authorities, INTERPOL and the U.S., we will learn whether they were asylum seekers or terrorists. Stay tuned.

*Nicole M. Ferrand is a research analyst and editor of “The Americas Report” of the Menges Hemispheric Security Project at the Center for Security Policy in Washington DC. (www.centerforsecuritypolicy.org). She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] Detienen a iraquíes con pasaportes falsos en Perú. El Universal, Venezuela. June 22, 2007
[2] Ibid.
[3] The Washington Times – Ibid.
[4] Ibid.
[5] Descubren tráfico de iraquíes a EEUU. July 18, 2007. La Republica, Perú.
[6] Ibid.
[7] Detienen a iraquíes que pretendían viajar a Los Ángeles desde Lima. El Comercio, Perú. June 22, 2007.
[8] Ibid.
[9] Iraqis captured en route to U.S. The Washington Times. September 11, 2007.
[10] Detienen a iraquíes con pasaportes falsos en Perú. El Universal, Venezuela. June 22, 2007

Free Trade: An antidote to Chavez

By John R. Thomson*

As Congress debates the merits of ratifying free-trade agreements with three Latin American countries, many arguments have been advanced from both sides. The politically charged climate on Capitol Hill obscures the underlying rationales favoring the treaties—and, broadly, free trade.

Agreements have been negotiated with Colombia, Panama, and Peru, each geopolitically and commercially important to the United States.

Colombia is our closest friend in Latin America. Washington has worked to strengthen U.S.-Colombian ties and to assist Bogotá in eradicating its narcotics production and stabilizing its democracy. Venezuela’s autocratic socialist President Hugo Chávez presents an enormous external challenge.

Panama, created by a U.S.-Colombian treaty in 1903 as an independent entity to construct a Pacific-Atlantic canal, enjoys significant growth and is planning a major expansion of the critical waterway. China sought to become a major factor in the country before the United States ceded control of the canal to Panama in 1999. Hong Kong’s Hutchison-Whampoa group has since operated the canal, so crucial to world trade.

Perú is one of three major centers of cocaine production in South America, with Bolivia and Colombia. President Alan García, elected in 2006, has committed his second term to free-market, democratic policies, in sharp contrast to his 1985–1990 first presidential term, which was characterized by a radical socialist agenda. García has also pledged to cooperate with Washington to replace cocaine production with economically viable, legal agricultural activities. Each of these nations plays a key role in Latin America, for the region as a whole and for the United States.

In The Wealth of Nations, Adam Smith considered free trade a great boon to the participating nations’ economies, workers and consumers. Charles Rangel (D-NY), chairman of the House Ways and Means Committee, frequently opines that free trade is especially beneficial to unemployed workers in developing countries. Both assessments are correct, as we have witnessed in virtually every free-trade agreement (FTA) enacted by recent administrations.

Most recently, the U.S.-Uruguay FTA changed Montevideo’s political orientation from sympathy towards Hugo Chávez’s populist, socialist Bolivarian Revolution to solid friendship with the United States, re-committed to the market economy. The Central American Free Trade Agreement (CAFTA) with four Central American nations and the Dominican Republic, also concluded during the current Bush Administration, has stabilized their economic and political climates.

Perhaps most important, the NAFTA agreement among the United States, Canada and Mexico, enacted during the Clinton Administration, has seen significant stabilization of all three signatory countries’ economies and of Mexico’s unpredictable political situation.

Two observations illustrate NAFTA’s enormous positive impact. During the twelve years the agreement has been in force, the U.S. economy has added thirty million jobs and unemployment has steadily declined to the current five percent level—despite AFL-CIO fears to the contrary. While this did not happen solely because of the trilateral accord, economists generally agree that NAFTA has been a significant contributor.

Several Mexican analysts credit domestic economic improvements created by NAFTA with the victory of Felipe Calderón in last year’s presidential election. Calderón won despite being a member of the same political party as the disappointing outgoing president, Vicente Fox, defeating ultra-leftist Andrés López Obrador by less than 234,000 out of 41.6 million votes cast, a razor-thin margin of 0.56 percent.

President Calderón has further opened Mexico’s economy, and is aggressively fighting endemic corruption by replacing thousands of corrupt police and sacking hundreds of conniving government officials. Calderón is also helping the United States’ illegal immigration dilemma by deploying 20,000 army regulars to the border area. These troops are fighting the extremely powerful narcotics organizations that refine and ship 90 percent of the cocaine that enters the United States.

Uruguay and Mexico exemplify a critical benefit of free-trade agreements, well-understood by America’s enemies: Fair and balanced economic relations set the stage for close relations at all levels.

Opposition in Bogotá to the pending U.S.-Colombia free-trade agreement comes virtually exclusively from the Left, particularly from those in open or covert alliance with Venezuela’s Hugo Chávez. Opposition to what Colombians call the TLC (for tratado de libre comercio, free-trade agreement) is based solely on critics’ not wanting Colombia to have close economic, military, political or cultural relations with the United States.

Chávez’s allies in Argentina, Bolivia, Ecuador and Nicaragua show no interest in being part of what Chávez refers to as the Bush “empire.” They have been co-opted into close political—and anti-American—relations by the checkbook diplomacy of Venezuela’s president. (In just the last two years, Venezuela has loaned Argentina’s tottering government at least $6 billion.)

Two of the three pending FTA’s are with Colombia and Peru, major cocaine-producing countries. The agreements, along with existing governmental programs, will create hundreds of thousands of jobs, a large majority of which will allow farmers who cultivate coca to desist from doing so. General Freddy Padilla de Leon, commandant of Colombia’s armed forces, observes:

Growing cocaine allows the farmer to buy his family rice, meat and other necessities. But our farmers don’t want that. To work cleanly and legally gives a man peace; to work illegally puts the [communist narco-trafficking guerrilla movement] FARC in control of his life.

We must fight the narcotics scourge at every level, but especially the agricultural sector. With solid economic growth, small farmers can enter the legal economy, which will decimate the cocaine crop and sharply cut the FARC’s income options.

Plan Colombia, instituted by the Clinton Administration, has for eight years trained and upgraded Colombian military and police forces, established job training programs for demobilized guerrillas and paramilitaries, and trained local government officials in effective community administration.

The U.S.-Colombia FTA, coupled with the extension of Plan Colombia, can deal a lethal blow to the Colombian drug trade and strengthen democratic forces prior to critical 2010 presidential elections.

Hugo Chávez is reportedly plotting with Colombia’s far left Polo Democrático Party to elect a radical socialist successor to President Álvaro Uribe, who was resoundingly re-elected in 2006. They plan to focus on some two million Colombians living in Venezuela—most of them illegally—offering permanent resident status, jobs and stipends in return for voting the Chávez-anointed presidential ticket. This, and Chávez’s commitment of five or ten billion dollars or more behind the chosen candidate, threatens to halt Colombia’s steady progress under Uribe’s leadership.

Colombian-American Manuel Rocha, a retired U.S. ambassador whose career focused on Latin America, including tours in Havana, Buenos Aires and La Paz, Bolivia, sees a continuation of Washington’s:

Self-punishing neglect of the region if Plan Colombia is not renewed and the FTA with Colombia not ratified. It will do far more than undermine our closest friend and the most entrenched democracy in Latin America. It will tell those who wish to be friends and allies of the United States they cannot rely on us, and open the door for more lethal mischief by Hugo Chávez. In so doing, we set the stage for a revolutionary hotbed south of the Rio Grande, and face the loss of Latin America to the free world for a generation.

On the other hand, informed Latin American and U.S. observers agree that successful implementation of free-trade agreements with Colombia and Peru, together with ongoing progress in Mexico, can substantially curtail the cocaine industry in Latin America and simultaneously strongly challenge Chávez’s Bolivarian revolution.

In addition to everything else, as political analyst and commentator Michael Barone recently observed, passage of all four pending free-trade pacts will provide 125 million potential customers for U.S. manufactured products.

Those who urge that a global World Trade Organization agreement is preferable to a series of bilateral and multilateral pacts ignore the WTO’s very limited progress towards creating global free trade. When the current expansion of free-trade accords has covered an overwhelming percentage of world trade, it may be possible for the WTO to fix the system, so no nation has preferential bias with one or another trading partner over others countries.

Indeed, as Congress demurs on the four critical agreements, a host of progressive-minded governments continue pursuing free trade with nations important to their economic and overall geopolitical interests. The creation and steady expansion of the free trade European Union of 27 countries is a fundamental reason for the region’s return to at least limited growth. Japan has negotiated an agreement with Indonesia canceling duties on 90 percent of products the countries trade, and is negotiating similar pacts with India and ASEAN. The 10 country Association of Southeast Asian Nations, is progressively converting the four decade old mutual defense organization, into a free trade bloc by 2015.

Colombia is undertaking free trade negotiations with 32 countries: the European Union plus Canada, Iceland, Lichtenstein, Norway and Switzerland. Mercosur, the world’s fourth largest trading block with a 250 million population and $1.1 trillion in cumulative GDP, has been invigorated by Venezuela’s entry in 2006. Chavez is promoting free trade among the signatory nations – Argentina, Brazil, Paraguay, Uruguay and Venezuela – accounting for 75 percent of South American GDP, as he pushes for Bolivian and Nicaraguan membership. Ecuador, currently an associate, is a likely additional full member.

Colombia’s lead negotiator, Hernando Gomez, president of the Private Competitive Council, observes that during the four year process; Both sides made compromises, resulting in a fair, strong, positive agreement, which our legislatures must now approve. Neighboring Peru will surely be approved in Washington first. If they have, say, a 20 vote margin in the House of Representatives, Colombia’s chances are good, but if it is very close….This is why it is so important for us to move forward with other FTA’s. When Congress realizes we are going to be importing wheat, soybeans and barley at favorable prices from Canada, they may see the value of taking action.

After a one and a half hour meeting, a visitor wonders why the articulate, well-informed Gomez is not involved in Colombia’s Washington lobbying effort. Knowledgeable advocates like General Freddy Padilla and Hernando Gomez could well make the difference.

There can be no doubt that taken together with strengthening bonds of friendship among like-minded governments in an increasingly tense world, passage of the pending FTA’s is clearly a deal Congress should not refuse.

*John R. Thomson is a businessman and journalist who writes frequently on geopolitical issues. He served as senior trade development representative in the Africa, Near East, South Asia (ANESA) region during the Reagan Administration.

Danger in the Region: Who’s Behind the Protests in Peru

By Nicole M. Ferrand.*

Thousands of farmers started open-ended violent strikes in eight Peruvian departments on Feb. 18, holding marches and blocking highways to demand “government measures to ease the impact of a free trade agreement (FTA, or TLC in Spanish) with the US.” At least 150 people were arrested and five have died so far. The government declared a state of emergency in the eight departments on February 19, and by the end of the day the organizers had suspended the strike and resumed negotiations with government officials. Also on February 19, teachers marched on Congress in Lima to protest a decree by social democratic president, Alan Garcia that teachers hired to work in public schools must have university degrees.[1]

Campesinos continued the strike through February 20 in the southern departments of Cusco, Arequipa and Ayacucho to protest the deaths in the preceding days. On February 20, US ambassador, Peter Michael McKinley spoke out in favor of the trade pact, which the US Congress approved in December. It will establish modern systems of trade regulation and design a discipline which will improve Peru’s competitiveness and promote its prosperity, he said. The protests continued two more days in Cusco, where local people called a 48-hour strike starting on Feb. 21 to protest a law allowing companies to set up businesses near archeological zones. Strikers blocked roads out of the city of Cusco, while some 500 marched in the downtown area. On February 21 protesters marched on the airport, causing some damage and leading the authorities to suspend flights for the duration of the strike. Hundreds of tourists were stranded.[2]

On February 22, Peruvian vice president Luis Giampietri blamed the protests on subversion by former presidential candidate, Ollanta Humala, and his Nationalist Peruvian Party (PNP). Prime Minister Jorge del Castillo has called for regional court systems to punish anyone that is caught blocking highways or protesting violently. Regional authorities have been warned that if protests continue, Cusco will not be accredited as one of the twelve venues for the Asia Pacific Economic Cooperation forum (APEC) meetings. The president of the Chamber of Commerce, Tourism and Industry of Huancayo, Luis Torres Garay, said that his province has the necessary hotel infrastructure to become an alternative venue for APEC, replacing Cusco.[3]

APEC Peru 2008 will be a series of political meetings to be held in Peru between the 21 members of the Asia-Pacific Economic Cooperation forum. Leaders from all countries will meet on November 22, 2008 in the capital city of Lima. The Asia-Pacific Economic Cooperation is a forum for 21 Pacific Rim countries or regions (styled ‘member economies’) to discuss the regional economy, cooperation, trade and investment. The membership is claimed to account for approximately 41% of the world’s population, approximately 56% of world GDP and about 49% of world trade. The activities, including year-round meetings of the members’ ministers, are coordinated by the APEC Secretariat.[4]

The leader of Peru’s left-leaning Nationalist Party, Ollanta Humala has organized “The People’s Social Summit,” which is to take place from May 13 - 15, the same dates world leaders will come to Lima for the European Union-Latin America and Caribbean (EU-LAC) Summit. Over 60 world leaders are to come to Peru for the EU-LAC summit while another 20 will be present for the APEC summit to be held in Peru.[5]

It’s no coincidence that the protests coincided with the EU-LAC and the APEC summits. The recent violent clashes between some groups of farmers and the police are believed to have been promoted by Humala and financed by Chavez since both do not want economic prosperity in Peru and want to destabilize the country for their socialist plan. Economic growth could block their nationalistic campaign in the region and they are taking advantage of these world events to halt progress and gain international publicity. The demonstrations have been infiltrated by members of the terrorist group, “Shining Path,” as well as supporters of Chavez and Humala, all in an effort to block progress. The encounters have already cost the provinces involved millions of dollars since they survive on tourism and commerce and many roads are now impassable. It has been reported that money is being sent through Bolivia from Venezuela to actually pay people to carry out attacks against government facilities and to help organize Humala’s summit.

Some locals complain that the armed forces are not reacting strongly enough against the demonstrators, which is true. The answer: they are afraid to be accused of “human rights violations.” Peruvians are now watching the absurd trial against former President Alberto Fujimori, where witnesses, including armed forces personnel, are being accused of “murder” for simply doing their jobs. Peru was fighting the terrorist groups “Shining Path” and the MRTA, which over thirty years killed thousands of innocent people. The Fujimori regime effectively contained them but the left and their NGO’s were furious about this and now are taking revenge. Many of these witnesses are in jail and are being horribly mistreated by the prosecutors and the judges involved in the case. President Fujimori is not being spared any of this treatment and his prison regime is much worse than that of Shining Path leader, Abimael Guzman.

The judge, prosecutors, the majority of the media and some presidential hopefuls are desperate to pin down the former leader and put him away and don’t seem to mind destroying people’s lives in the process. They still see him as a threat to their personal agendas since recent polls reveal his popularity is soaring. Since they cannot find proof that the government “carried out acts of political violence (massacres, extrajudicial killings, and forced disappearances) in a systematic way and with a level of organization that could have only existed with approval from the highest levels of government,” they are becoming desperate. In order to convict Fujimori, the prosecutors must demonstrate that the Colina Group (a team of select army intelligence operatives belonging to the armed forces, created in the late ‘80s’) acted with the president’s imprimatur, that he either ordered its creation, approved of its actions, or, at the very least, knew of its existence as Commander in Chief of the Peruvian military. Many of the accused have declared that some abuses committed by the military “are isolated actions that do not reflect institutional behavior.” Witness after witness have revealed that they were bribed or promised lighter sentences if they accused Fujimori, stating that they never saw or heard him giving any orders and cannot involve him in the cases he is accused of. So it is not difficult to see why the police don’t want to act against the recent protests.

But there could be another reason for the lack of governmental resolve to stop the violence. It is said that current vice President Jorge del Castillo wants to run for President in the next elections in 2011 and that is why he wants to appear as a “moderate.”

The fact of the matter is that many sectors of the population seem to be aware of what is going on and are becoming extremely disturbed by these attacks which are costing small businesses money and are putting jobs at risk. Many locals are coming out loudly against the Nationalist leader, Humala and his supporter, Chavez. Unfortunately, the Garcia regime is taking a toll and recent polls reveal he is sliding as many people are voicing their disappointment at the lack of action.

Update –
The Minister of Defense Ántero Flores-Aráoz announced on February 27, that Cusco would not be one of the venues for the Asia Pacific Economic Cooperation (APEC) forum summit because of certain violent sectors of the region and the silent attitude from the rest of the Cusqueñans. “Cusco has given up their title as one of the venues for APEC in November and the government has accepted this decision,” said the minister. He also announced that a venue to replace Cusco hasn’t been decided yet, but will be announced within the next few weeks. The Minister stated that the violent protests, acts of vandalism, roadway blockages, and the assault on the airport have caused them to take this precaution and exclude Cusco from APEC venues. “The violent protesters don’t wish APEC members to visit Cusco, while the rest of Cusco has been silent in all languages, that is to say, instead of expressing their protests against the violent acts, they’ve remained quiet and have therefore in a way accepted that violence. By being silent, they have become accomplices in this situation.”[6]

This is a sad but correct decision. Sad because Cusco is a beautiful place and the APEC summit would definitely benefit the region but it is the correct one. Now everyone will know the costs of having and/or allowing such behavior and the government has gained legitimacy among Peruvians.

*Nicole M. Ferrand is a research analyst and editor of “The Americas Report” of the Menges Hemispheric Security Project at the Center for Security Policy in Washington DC. (www.centerforsecuritypolicy.org). She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] APEC and EU-LAC Peru 2008 Summits - Daily Updates. Living in Peru.
[2] APEC and EU-LAC Peru 2008 Summits - Daily Updates. Living in Peru
[3] APEC and EU-LAC Peru 2008 Summits - Daily Updates. Living in Peru.
[4] APEC and EU-LAC Peru 2008 Summits - Daily Updates. Living in Peru.

[5] APEC and EU-LAC Peru 2008 Summits - Daily Updates. Living in Peru
[6] APEC and EU-LAC Peru 2008 Summits - Daily Updates. Living in Peru

Peru: A Comparison of President Garcia’s Two Terms in Office

By Nicole M. Ferrand.*

When Peru’s Alan Garcia was elected President for a second time in 2006, I was perplexed. How could this happen I kept asking myself. His first term in office between 1985 and 1990 was catastrophic. He was voted the worst President of Latin America. While visiting Peru in February 2008 I wanted to find out the reasons behind his 2006 victory and how his current regime is progressing.

Garcia’s first term in office
Let’s recap Alan García’s first term in office between 1985 and 1990 to fully understand the magnitude of the Peruvian transformation. At 36 years of age García became the youngest civilian president in Peru’s history. His first regime was marked by bouts of hyperinflation which reached 7,649% in 1990, profoundly destabilizing the Peruvian economy.

Due to such chronic inflation, the Peruvian currency, the sol, was replaced by the Inti in mid-1985, which itself was replaced by the nuevo sol (“new sun”), at which time the new sol had a cumulative value of one billion (1,000,000,000) old soles. By the end of his term in 1990, national reserves were a negative $900 million dollars. García also made an attempt to nationalize the banking and insurance industries. He incurred the wrath of the International Monetary Fund and the financial community by unilaterally declaring a limit on debt repayment equal to 10% of the Gross National Product, isolating Peru from international financial markets. According to studies of the National Institute of Statistics and Informatics and the United Nations Development Program[1], around the start of his presidency, 41.6% of Peruvians lived in poverty. During his presidency, this percentage increased by 13% (to 55%) in 1991.

Alan Garcia.

This economic turbulence exacerbated social tensions in Peru and contributed in part to the escalation in violence of the terrorist groups: Shining Path (Sendero Luminoso) and Movimiento Revolucionario Tupac Amaru (MRTA). These groups controlled about a third of the country and were responsible for the deaths of thousands of innocent civilians, and army and police personnel. (Read “The Americas Report” from October 11 and 18 - Fujimori: the other side of the story - Part I and Part II by Nicole M. Ferrand).

The SL and MRTA began attacking electric towers, causing almost daily blackouts all over the country. The García administration sought a military solution to the growing problem, but was unsuccessful. The MRTA used kidnapping and extortion as well as drug trafficking to finance their activities. In addition, the country was being ravaged by corruption, by drug problems, and by terrorist warfare. Most universities were inaccessible since they were dominated by these violent groups.

In general, everyday life was harsh. There were food, water and electricity shortages, car bombs exploded almost daily, killing and severely injuring thousands of people as well as members of the military and police. Soon, the attacks were also felt in the capital city of Lima and people lived in constant fear. There were limits on the amount of food each family could buy, and supermarkets were meagerly stocked as prices changed by the hour. By the end of García’s presidency Peru was suffering from hyperinflation, was isolated from the international financial community, had negative reserves of US$900 million, and was dealing with continuous subversive activities by the Shining Path and MRTA. There was also a great increase in poverty levels. I remember these days clearly since my siblings and I were sent daily to various supermarkets to buy what we could find.

In 1992, García went into self- exile and lived in Colombia and later in France. The Fujimori regime re-opened charges against him for allegedly taking millions of dollars in bribes. He denied the charges, and in 2001 Peru’s Supreme Court ruled that the statute of limitations had run out. García decided to ran for president in the new elections called by the temporary president, Valentin Paniagua, but lost against Alejandro Toledo.

Why did Alan Garcia win the 2006 Presidential elections: the “Humala”/Chavez factor
García officially started his campaign for the April, 2006 presidential election on February 18, 2005. Voting for Alan Garcia was considered by over 40% of the voters as “voting for the lesser of two evils”. Many citizens had a very negative impression of García after his first presidency but were scared by rumors that Humala would create a government based on Fidel Castro’s Cuba and would turn Hugo Chavez, President of Venezuela, into the virtual ruler of Peru, due to his patronage and financial support of Humala’s party. Humala denied these accusations, but his conflicting statements about his government’s vision and Chavez’s strong campaigning for him created enough suspicions among voters to cost him the election. President Chavez openly declared his support for Humala, and referred to García as a “robber”, and a “bandit.” García, in response, stated that Chávez was “not acting as a statesman” and challenged Chávez to a public debate. García also brought this issue to the Organization of American States. In the end, the Venezuelan leader cost Humala the election and García was inaugurated as President of Peru on July 28, 2006.

With thirty-six seats, Garcia’s Party, APRA, has the second largest bloc in the 120-seat unicameral Congress which was sworn in a couple of days before the President. With forty-five seats, Humala’s “Union por el Peru” Party has the largest bloc, although it has been divided into three factions.[2]

García’s victory was praised by democratic nations. It prevented Hugo Chávez’s left-leaning “socialist revolution” from spreading throughout the continent.

What Alan Garcia inherited from previous governments
The Government of Peru under former President Alberto Fujimori took the necessary steps to bring the problems created by the Garcia regime under control. Democratic institutions, however, and especially the judiciary, remained weak. Between 1992 and 2001, Peru attracted almost $17 billion in foreign direct investment, after negligible investment during the 1980s, mainly from Spain (32.35%), the United States (17.51%), Switzerland (6.99%), Chile (6.63%), and Mexico (5.53%).[3]

The Peruvian economy underwent considerable free market reforms since 1992, from legalizing parts of the informal sector to significant privatization in the mining, electricity and telecommunications industries. The economic stabilization and liberalization program lowered trade barriers, eliminated restrictions on capital flows, and opened the economy to foreign investment. Thanks to strong foreign investment and the cooperation between the Fujimori government and the IMF and World Bank, growth was strong from 1994 to 1997 and inflation was brought under control. Peru now has one of the most open investment regimes in the world.

Alejandro Toledo’s presidency (2001-2006) was characterized by extremely low approval ratings but high economic growth rates; 5.9% in 2005 and 8% in 2006 due to the policies of the Fujimori regime. Toledo was able to push through several reforms, including tax reform and a pending free trade agreement with the United States. Despite the economic improvements, Toledo’s presidency was plagued with allegations of corruption and frequent popular protests.

Garcia’s current term in office
I was impressed by what I found during my recent visit to Peru. The Jorge Chavez Airport has been modernized and the security systems are impeccable. The roads are in extremely good condition and there is construction everywhere which shows the confidence many Peruvians and international corporations have in Peru. Consumption has grown tremendously and there are small businesses, elegant restaurants and new shopping malls full of people. Tourism has reached levels never seen before and hotels are fully booked throughout the year.

It is a pleasure to go south using the highways and the country overall seems more secure and organized. Big exporting farms and packing plants in the south have incorporated and employed people from surrounding communities and social programs are present everywhere. Entrepreneurs provide social services as hospitals and schools are built. Many previously marginalized groups are now active participants in this new found economic expansion. Police officers in modern cars are present throughout and big trucks full of merchandise come and go, showing the growing commercial capacity in the countryside.

To the surprise of many, Mr. Garcia recruited a respected and competent cabinet, including an economic team of technocrats which increased the confidence of national and international investors and financial communities. He has continued the orthodox economic and fiscal policies carried out by the previous two Peruvian governments. These policies have contributed, along with the international commodities boom to Peru’s growth rate of more than 8% annually; expanding reserves while containing inflation. Construction and retail opportunities are spreading from Lima to several regions. Peru’s export sector, particularly specialty vegetables and fruits, is growing at an impressive rate, as well as mining investments. Garcia has since avoided abrupt policy shifts and has retained the political initiative and defused opposition to his government. When strikes and protests occurred, Garcia has tried to turn these to his political advantage, asserting national authority against the retrograde ultra-left members of some Unions who are not widely popular.

During the first few months of his administration, Garcia boosted his approval rating into the high sixties, mainly by demonstrating that he was a force for stability, unlike Humala, and also for austerity, unlike his predecessor, Alejandro Toledo, who was given to extravagant personal spending and outright frivolousness. Garcia also promised a major expansion of investment, greater decentralization of public expenditures, big infrastructure projects, a campaign against malnutrition and a crackdown on crime, including application of the death penalty for pedophiles.

According to estimates from analysts as well as local and foreign banks, Peru will register the lowest inflation rate in Latin America during this year and 2009. The president of the Central Reserve Bank of Peru (BCR), Julio Velarde, pointed out that the inflation rate in Peru would be within a range from one to three percent over the second half of this year. In addition, Julio Velarde forecasted that Peru’s economy would increase 7% this year - stimulated by both the public and private sectors.[4]

The Peru-United States Free Trade Agreement (FTA), also known as the United States-Peru Trade Promotion Agreement (TPA), was signed on April 12, 2006 by President George W. Bush, and won Congressional approval on December 4, 2007. This accord is already benefiting producers in both countries with greater market access and consumers with less expensive products. From a security standpoint, this ratification consolidates a partnership with the South American country which is critical in a region where free markets and U.S. influence is being attacked by populist and nationalist governments in Venezuela, Ecuador and Bolivia.

The following data show the benefits of the trade agreement: U.S. imports from Peru will increase by $439 million, or 8% and U.S. exports to Peru will increase by $1.1 billion, or 25%. The largest value increases in U.S. exports will be in machinery and electrical equipment, chemicals, rubber, plastics, wheat, rice, pork, and poultry. Trade facilitation provisions, such as the definition of custom procedures, administration, and dispute, will lead to a more stable and reliable trading environment, further buttressing U.S.-Peru trade and investment. The protection of intellectual property in Peru, through new rules Peru commits to under the agreement, will be significantly improved.[5]

FTA, Security and Humala
After Chile and Colombia, Peru is an important democratic ally in South America’s Andean region. It trades nearly $6 billion in goods and services annually with the United States and cooperates in combating illegal drug trafficking but poverty still afflicts about half the population. Peru needs a more skilled workforce, a stronger rule of law, a reduction in burdensome regulations, and a commercial code that promotes entrepreneurship. Having FTA will help to advance these objectives.

So far, Alan Garcia has taken the correct steps and Peru is still a growing economy. In addition, some groups which previously didn’t have access to private property are now enjoying the benefits of having their own houses and small businesses. Some even say that Peru has already reached a point of no return and a socialist appeal will hardly find much support. But let’s keep in mind that Chavez’s ally, Ollanta Humala, remains a threat to democracy and a free market economy since he is still popular in some provinces due to his socialist and nationalistic rhetoric. Some people remain convinced that he continues to receive financial support from Chavez and that he is quietly campaigning in many provinces. This is of concern to many locals and regional leaders. In fact the recent violent clashes between some groups of farmers and the police are believed to have been promoted by Humala who has organized “The People’s Social Summit”, which is to take place from May 13 - 15, the dates on which world leaders will come to Lima for the European Union-Latin America and Caribbean (EU-LAC) Summit, and financed by Chavez since both do not want economic prosperity in Peru and want to destabilize the country for their socialist plan. Economic growth could block their nationalistic plans in the region and they are taking advantage of the Summit which Peru is hosting to halt progress and gain international publicity. Peru and Colombia now constitute a headache for Chavez’s socialist revolution as they are examples of functioning democracies, with strong economic growth.

In this regard, successful economic policies and the ratification of the FTA are providing incentives for Peru to become more competitive and less likely to succumb to authoritarianism and closed markets. For the United States and its allies in the region, this is critical. It is hoped that the Peruvian example will provide an incentive to many Democrats in Congress who are still refusing to ratify the FTA with Colombia and Panama. Trade is important but the region’s security must be a priority. Latin America is still at risk and the trade accord and the continuous funding of Plan Colombia will help placate those who want to destabilize the region.

*Nicole M. Ferrand is a research analyst and editor of “The Americas Report” of the Menges Hemispheric Security Project at the Center for Security Policy in Washington DC. (www.centerforsecuritypolicy.org). She is a graduate of Columbia University in Economics and Political Science with a background in Law from Peruvian University, UNIFE and in Corporate Finance from Georgetown University.

[1] Peru will register lowest inflation in Latin America in 2008 and 2009. 11 February, 2008. Living in Peru.
[2] Congress Should Advance U.S.-Peruvian Free Trade Ties. July 12, 2006. The Heritage Foundation.
[3] Exit Poll Results: Alan Garcia in First Place University of British Columbia — Peru Elections 2006, June 4, 2006.
[4] Alan García in Dispute with Hugo Chávez, University of British Columbia — Peru Elections 2006, April 28, 2006
[5] Alan García reta a Chávez a polemizar por CNN, El Universal, 28 April 2006.