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Viewing cable 05LIMA5391, INTERNATIONAL NARCOTICS CONTROL STRATEGY REPORT,

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Reference ID Created Released Classification Origin
05LIMA5391 2005-12-21 20:30 2011-08-25 00:00 UNCLASSIFIED Embassy Lima
This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS SECTION 01 OF 08 LIMA 005391 
 
SIPDIS 
 
JUSTICE FOR OIA, AFMLS, AND NDDS 
TREASURY FOR FINCEN 
STATE FOR INL/LP, WHA 
USAID FOR LAC/SAM 
E.O. 12958: N/A 
TAGS: SNAR PREL PE
SUBJECT: INTERNATIONAL NARCOTICS CONTROL STRATEGY REPORT, 
PERU, 2005-2006 
 
REF:  SECSTATE 209560 
 
1.  The following is Post's submission as Part I of the 2005- 
2006 International Narcotics Control Strategy Report 
(INCSR), Drugs and Chemical Controls 
 
2. Summary - In 2004-2005, the Peruvian government (GOP) 
surpassed its coca eradication goals and conducted 
operations on land and sea to disrupt the production and 
transshipment of cocaine.  Despite these efforts, the 
Peruvian Government will not be able to fulfill the 
assurance given by President Toledo in 2000 that illegal 
coca would be eliminated during his administration.  Since 
that commitment was made, the price of coca leaf has risen 
steadily and the number of hectares under cultivation has 
grown in areas not under the GOP's control.  Cocaleros have 
become more violent and better organized within valleys. 
Terrorist groups claiming to be affiliated with Sendero 
Luminoso (SL) have also openly identified with coca growers 
and drug traffickers and engaged in increasingly violent 
ambushes of police and intimidation of alternative 
development teams in coca growing areas.  Traffickers are 
adapting to counter-drug strategies to increase narcotics 
production.  There has been a significant shift in the 
Peruvian public's views on widespread myths surrounding 
coca.  There is a much greater public understanding of the 
close linkage between illegal coca cultivation and the 
hugely negative impact of narco-trafficking on Peru and its 
people. 
 
3.  The GOP surpassed its goal for coca eradication in 2005 
but this effort may not have kept pace with expanding coca 
cultivation.  The Peruvian Government has made progress in 
strengthening police capacity East of the Andes.  Four 
hundred police graduates dedicated to counter-narcotics 
graduated from NAS-supported police academies in 2005. 
Their entry on duty has allowed the Peruvian National Police 
(PNP) to effect sustained interdiction in source zones and 
to carry out eradication in valleys where coca farmers have 
violently resisted forced eradication in the past. The 
Government of Peru's Office of Drug Control (DEVIDA) has 
adopted the United Nation's estimate released in June 2005 
that there are 50,000 hectares of coca under cultivation in 
Peru that produce a potential annual harvest of 110,000 
metric tons of coca leaf.  An estimated 9,000 tons of leaf 
are consumed licitly.  The UN estimates that the balance of 
approximately 100,000 metric tons of coca leaf is available 
to make up to an estimated 190 metric tons of cocaine 
annually.  A relatively small percent of Peruvians, 250,000 
people (45,000 families) out of a population of 27 million, 
are involved in growing, processing and trafficking coca. 
 
4.  The GOP showed steadfast resolution in carrying out 
eradication in the Huallaga valley despite violent 
opposition by coca growers and elements of the Sendero 
Luminoso terrorist group. Eradicators returned to San Gaban 
in 2005, an area of new and expanding coca cultivation, to 
complete efforts begun last year.  The GOP eradicated almost 
9,000 hectares of coca in key producing zones of the 
Huallaga Valley and San Gaban in Puno Department, and over 
3,000 hectares more in voluntary eradication linked to 
alternative development.  Port programs directed at 
interdicting maritime shipments of drugs have also begun to 
pay-off.  Over 11 metric tons of Peruvian cocaine was seized 
in Peru or in transit to consumer destinations in CY 2005. 
 
5.  In October, the Constitutional Tribunal supported the 
GOP's exclusive control over national drug policy, 
overturning two regional ordinances that aimed to liberalize 
coca cultivation.  In Congress, over 20 legislative coca law 
proposals have been put forward; however, with elections in 
2006, passage of any coca law is uncertain.  The proposed 
laws run the gamut but generally favor liberalization with 
the exception of the GOP proposal that establishes a ceiling 
on licit coca. In November, Peruvian National police 
arrested Fernando Zevallos, a U.S. Government designated 
drug kingpin.  One cause for concern is the growing evidence 
of increasing links between the Sendero Luminoso and 
cocaleros in the Upper Huallaga and Apurimac and Ene River 
Valleys (Spanish acronym is VRAE).  End Summary. 
 
II. Status of Country 
 
6.  Illicit Cultivation - In 2005, the GOP planned and 
mounted aggressive interdiction and eradication campaigns in 
two key coca-growing regions - the Huallaga Valley and in 
San Gaban in Puno Department.  The primary reasons for the 
continuing success in eradication campaigns are the resolve 
of the police to hold their ground against cocalero threats 
and the close coordination between different GOP 
institutions (police and eradication corps, drug 
prosecutors, among others). The Ministry of Interior's coca 
eradication group eradicated almost 9,000 hectares of coca 
by year's end in Peru, plus an additional 3,200 hectares 
through voluntary eradication. This Ministry of Interior 
office is known in Spanish as el Proyecto Especial de 
Control y Reduccion de los Cultivos the Coca en el Alto 
Huallaga (CORAH). 
 
7.  The GOP conducted eradication operations in the Huallaga 
Valley in entrenched coca cultivation zones around the town 
of Pizana that, previously, had been off limits because of 
violent resistance by farmers.  The PNP mounted extensive 
interdiction campaigns to establish the illegality of the 
coca production by destroying cocaine base laboratories 
prior to initiating eradication.  Attacks against PNP 
helicopters carrying security forces and eradicators delayed 
the start of eradication until police began inserting larger 
numbers of troops to protect eradicators.  The GOP was 
remarkably steadfast in carrying out eradication in the 
Huallaga valley despite violent opposition by coca growers 
and elements of the Sendero Luminoso terrorist group. With 
strong backing by senior GOP officials, these new tactics 
have proven successful in this cocalero stronghold. 
Eradicators pulled up a total of 5,429 hectares of coca in 
the Huallaga Valley as well as 35,600 square meters of 
seedbeds that could have planted an additional 2,373 
hectares of coca. 
 
8.  Eradicators returned to San Gaban in Puno Department in 
October 2005, an area of new and expanding coca cultivation, 
to complete efforts begun in 2004 when it eradicated 1,500 
hectares of coca.  Eradication proceeded peacefully after 
the PNP deployed a sizeable force of drug police. 
Eradicators pulled up 1,475 hectares of densely planted coca 
in San Gaban between October and December. 
 
9.  CORAH also eradicated small amounts of coca in areas 
where coca growers were interfering with communities that 
wished to participate in voluntary eradication as well as 
others that failed to fulfill a commitment to voluntary 
eradication under the PDAP (Participative Alternative 
Development Program).  This effort has helped clear the way 
for the program's1 implementation in some new areas and, in 
general, publicly reinforced the government of Peru's 
commitment to enforcing coca eradication agreements. 
 
10.  As evidenced by attacks on NAS helicopters in April and 
kidnapping of and threats to alternative development workers 
in November, and two deadly ambushes of police in the Upper 
Huallaga and VRAE in December, there are growing links 
between the Sendero Luminoso and cocaleros.  Generally, 
cocalero organizations remain aggressively active but 
divided. Some fifteen hundred cocaleros met in September at 
the Fourth Congress of the National Confederation of 
Agricultural Producers of the Coca Valleys of Peru.  Though 
some new alliances were made, representatives from the 
Monzon and Cuzco did not attend, effectively thwarting 
attempts to create a national cocalero movement.  The 
cocalero congress did elect new leadership that is 
advocating more radical, confrontational tactics. 
 
11.  Trafficking organizations continue to use all available 
methods to move coca products out of Peru via air, river, 
land and maritime routes to Mexico, Bolivia, Brazil, 
Colombia, Ecuador and Chile.  Opium latex and morphine move 
overland north into Ecuador and/or Colombia, where they are 
collected and converted to heroin for subsequent export to 
the U.S. and Europe.  Maritime smuggling of larger cocaine 
shipments is becoming increasingly dominant as a primary 
method of transporting multi-ton loads of cocaine base and 
HCl. 
 
12.  Cocaine base (locally referred to as PBC) was once 
considered the traditional principal form of coca product 
produced and trafficked in Peru.  However, in 2005, as 
evidenced by multi-ton and multi-kilogram seizures, cocaine 
HCl rapidly became the principal product in Peruvian drug 
trafficking.  It is also evident from seizures that large- 
production laboratories in Peru are being utilized to 
prepare this product in coca growing regions as well as in 
the coastal regions of Peru. 
 
13.  The presence of opium poppy cultivation in Peru is an 
increasing international concern.  Intelligence indicates 
that opiate trafficking in Peru, to include opium poppy 
cultivation, the production of opium latex, and suspected 
morphine, is primarily concentrated in the northern and 
central parts of the country, with poppy cultivation also 
sited in the Huallaga and Apurimac Valleys although there 
are no reliable estimates as to the number of hectares under 
cultivation in remote areas.   In April 2005, a PNP 
investigation resulted in the seizure of 412 kilograms of 
opium latex in Chiclayo Province, Peru.  However, it is 
unknown if these sizeable seizures are related to increased 
opium poppy cultivation in Peru.  Intelligence indicates 
that opium products are shipped via land routes to Ecuador 
and Colombia for conversion to morphine base and heroin. 
 
III. Country Actions against Drugs in 2005 
 
14.  Law Enforcement Efforts - In 2005, the GOP made 
significant strides in investigating and dismantling major 
drug trafficking organizations and attacking drug-processing 
sites in key source zone valleys of the Monzon and 
Apurimac/Ene River Valleys (VRAE).  The Peruvian National 
Police Narcotics Directorate (DIRANDRO) mounted several 
successful operations in the Monzon destroying over 621 
metric tons of coca leaf and 522 cocaine base laboratories. 
No eradication took place in the Monzon in 2005 where there 
are approximately 11,000 hectares of coca. 
 
15.  The VRAE has approximately 14,000 hectares of coca 
under cultivation.  In recent times, it has become 
increasingly dangerous for legitimate economic activity, 
including alternative development, as narcotraffickers 
linked to subversive groups rule in the absence of state 
security.  As they have done in the Monzon Valley, the PNP 
are engaged in an interdiction campaign in the VRAE from the 
newly constructed police base in Palmapampa.  The GOP is 
using Palmapampa to reestablish police presence and end a 
climate of impunity in the VRAE.  This year the PNP drug 
police destroyed over 767 rustic cocaine base laboratories 
and 1,200 metric tons of coca leaf in the VRAE.  In May 
2005, the PNP located a large, well-equipped cocaine HCl 
laboratory in the region, seizing over 1 ton of cocaine and 
seven tons of precursor chemicals.  The PNP reports it was 
the largest cocaine HCl laboratory ever found in Peru.  As 
part of this effort to disrupt drug trafficking in the 
Ayacucho region adjacent to the VRAE, the PNP deployed a 
mobile road interdiction group trained to detect contraband 
from precursor chemicals to drugs using x-ray technology. 
This team has been effective in deterring truckers from 
transporting chemicals into the area. 
 
16.  The PNP established two new basic training academies in 
2004 at the Santa Lucia and Mazamari police bases, located 
in two coca-growing regions.  The first two hundred students 
graduated in May 2005.  They are working in Peruvian drug 
police units operating in the coca growing valleys.  Their 
availability was a key factor in enabling the drug police to 
support simultaneous eradication and interdiction operations 
in different coca valleys this year.  A third academy was 
established in October 2005. Another 200 students will 
graduate in December 2005.  The new graduates will all be 
assigned to Dirandro for counter-drug operations. 
 
17.  Mexican drug cartels are appearing more frequently as 
key players in directing the shipment of multi-kilogram and 
multi-ton loads to Mexico and the Caribbean.  Colombian drug 
trafficking organizations are present to a lesser degree. 
Continued aggressive investigation by the PNP is slowly 
beginning to make headway against these Peru-based 
organizations. DIRANDRO successfully identified and 
disrupted major international cocaine trafficking 
organizations responsible for maritime and air shipment of 
metric tons of cocaine to U.S., South American and European 
markets. Fernando Zevallos-Gonzales, an OFAC-designated 
Kingpin and a Department of Justice OCDETF-designated 
priority target, was taken into custody on November 19. 
Zevallos was sentenced by a Peruvian court to 20 years in 
jail in December.  Two of his key lieutenants, Jorge CHAVEZ- 
Montoya and Jesus Manuel FRANCIA-Pesaque were arrested 
separately on charges including drug trafficking and witness 
intimidation. 
 
18.  The USG and GOP have cooperated to improve port 
security and to address increased maritime smuggling at 
Peruvian ports. In 2005, U.S. and Peruvian law enforcement 
efforts led to the seizure of over 11 tons of cocaine HCl. 
See Para 23 for details. 
 
19.  Opium poppy - The PNP eradicated 92 hectares of opium 
fields in CY2005.   The GOP has estimated there are about 
1,500 hectares of opium poppy under cultivation based on the 
amount of hectares eradicated and opium latex seized in 
2004. These figures cannot be corroborated.   The GOP and 
USG conducted a short-term aerial survey of suspected opium 
poppy growing areas in northern Peru but found little 
cultivation.  Additional efforts to quantify the opium poppy 
crop are underway.  Although efforts to locate opium poppy 
fields from the air have been unsuccessful, the PNP 
continues to report multiple seizures and arrests related to 
opium latex trafficking.  Although most opium latex and 
morphine base is transported overland from Peru to Ecuador 
and Colombia, "mules" carrying opium latex have been 
intercepted at the Jorge Chavez International Airport and in 
packages sent through the Peruvian postal system to 
destinations in Europe.  DIRANDRO seized 573 kgs of opium 
latex in the first five months of CY2005, up from 383 kgs in 
all of CY 2004.  Based on the poor quality of latex seized 
to date, however, Peruvian producers seem unable to deliver 
a product suitable for heroin production. 
 
20.  Judiciary, Congress and Legislation - The GOP 
challenged the constitutionality of two regional ordinances 
that sought to liberalize coca production.  The 
Constitutional Tribunal declared the ordinances 
unconstitutional, but also criticized the GOP's coca 
policies and their implementation.  The decision effectively 
ended pro-coca regional ordinance efforts, but spurred 
public and Congressional discourse on the need for a new 
coca law.   Over 20 different coca law proposals were 
introduced in Congress most of which argued for expansion of 
coca cultivation and liberalization of GOP controls.  The 
GOP submitted its own draft law that seeks to limit coca 
production to the 9,000 metric tons needed to supply the 
legitimate domestic demand for coca leaf.  At the end of 
2005, Congress had passed no new coca law.  To implement 
last year's law to control precursor chemicals used in 
cocaine processing, the GOP issued its regulations; however 
putting the regulations into practice remains an ongoing 
challenge. 
 
21.  A recent public opinion poll conducted in Lima and five 
cities in coca-growing regions indicates that the Peruvian 
public is greatly concerned about the extent of influence of 
narco-traffickers over public institutions and authorities 
believes that both the Peruvian government and Congress must 
do more to defeat narco-trafficking.  The poll surveyed 
randomly selected persons in different socio-economic 
classes between 18-65 years in Lima, Pucallpa, Aguaytia, 
Huanuco, Ayacucho and Cusco.  One major change from previous 
surveys is the growing recognition of the role of coca 
farmers in drug trafficking and the influence of narco- 
traffickers over coca grower organizations.  Over 77 percent 
recognized that most coca leaf is destined for narco- 
trafficking and 61 percent acknowledged that coca growers 
are part of the drug supply chain.  More surprisingly, over 
71 percent of those surveyed opined that coca growers who 
sell coca leaf to drug traffickers should be punished. 
Peruvians surveyed also recognize that drug trafficking is 
not a problem only for foreigners.  Over 90 percent of 
respondents thought that drug trafficking is a problem that 
affects both Peru and other countries.  Less than 8 percent 
thought that it was only a problem for the United States. 
 
IV. U.S. Policy Initiatives and Programs. 
 
22.  The change in Peruvian perceptions about coca growing 
and the complicity of coca farmers in narco-trafficking is 
to a great extent due to multiple U.S. and GOP efforts to 
inform the public debate in the press, via television and 
radio and among Peruvian government officials. 
 
23.  Bilateral Cooperation - The USG continues to encourage 
the GOP to focus its counter-drug operations in the major 
drug source zones in the Upper Huallaga Valley and 
Apurimac/Ene Valley.  The Peruvian National Police have been 
able to increase police presence and their operational 
productivity in these areas by using USG assistance to 
fortify existing police bases, increase the number of drug 
police working in the coca valleys, and enhance police 
training and mobility.  The USG is also providing assistance 
to expand the GOP's anti-drug canine programs. 
 
24.  Peru's law enforcement organizations have participated 
in joint operations and shared drug intelligence with 
neighboring countries.  In Operation Amazonas, the PNP 
conducted a joint operation with Ecuadorian National Police. 
Operation Northern Border began with a conference to address 
drug trafficking along Peru's borders with Brazil, Colombia, 
and Ecuador.  A Mini IDEC conference brought together law 
enforcement representatives from Colombia, Ecuador, Peru and 
Venezuela as well as Brazil, Panama and the U.S.  The group 
reported on money laundering initiatives as well as growing 
problems with narco-terrorism.  Finally, Peru is actively 
participating in a counter-narcotics officer exchange 
program with Bolivia, Brazil and Ecuador to enhance cross- 
border drug enforcement efforts. 
 
25.  Maritime/Airport Interdiction Programs - It is 
estimated that 70 percent of all illicit drugs exported from 
Peru are hidden in legitimate maritime cargo. DIRANDRO and 
Peruvian Customs have established a joint interdiction group 
at the Port of Callao to review all export documents of 
containerized-freight and identify suspect cargo for further 
inspection.  The USG and GOP are increasing investigative 
and intelligence resources targeted at the transportation of 
cocaine products to the coastal regions for maritime 
smuggling and to enhance the GOP's capability to identify 
and inspect suspect cargo shipments passing through Peruvian 
maritime ports and its international airports.  The GOP has 
made many arrests and multi-ton/multi-kilogram seizures 
totaling over 11 metric tons of cocaine HCl in 2005.  As an 
example, in February 2005, a PNP investigation resulted in 
the discovery of 1.2 metric tons of cocaine HCl hidden in 
false compartments in a chemicals tanker at the Port of 
Callao.  In another case, the PNP identified and surveilled 
a suspicious cargo vehicle destined for a fish export 
company.  Cocaine was found packed in frozen squid. 
Subsequent investigations identified containers of frozen 
squid from the fish export company that had been sent to 
locations in the U.S. and Europe.  The PNP alerted police in 
destination countries of suspect drug shipments.  These 
warning alerts have resulted in multiple seizures in the 
United States and Europe.  We expect seizures to escalate as 
the GOP expands its canine and technology (X-ray and Gamma- 
ray) programs at several key sea and airports. 
 
26. Precursor Chemicals - Peru produces some precursor 
chemicals and imports large volumes of all essential 
chemicals for cocaine production.  In 2005, the PNP Chemical 
Investigations Unit successfully executed operations against 
Peruvian companies suspected of diverting tons of these 
precursor chemicals from legitimate use.  Targets included 
companies in coca growing valleys that diverted sulfuric 
acid, legitimately used in automobile battery maintenance, 
to the illicit market.  Police also seized 6.6 tons of 
acetone and significant amounts of hydrochloric acid, 
potassium permanganate and sulfuric acid at a major cocaine 
HCl production laboratory.  The Peruvian National Police 
participated with neighboring countries and the U.S. in a 
regional chemical control program known as Operation Six 
Frontiers during which the PNP seized a record amount of 122 
metric tons. 
 
27.  Regional aerial interdiction programs - Progress was 
made in 2005 towards establishing a more detailed picture of 
aerial trafficking in Peru.  In September, the GOP signed a 
Cooperating Nation Information Exchange System agreement 
(CNIES) that will enable the USG and other cooperating 
nations to share intelligence about trafficking of drugs by 
air. The Peruvian Air Force formed an anti-drug squadron and 
accepted two aircraft, one specially equipped, donated to 
the Peruvian Air Force (Fuerza Aerea del Peru - FAP) by the 
USG.  These aircraft will be dedicated to counter-narcotics 
missions.  The US Department of Defense is working with the 
FAP to study the feasibility of establishing radar coverage 
over areas of Peru suspected to be over-flown by narco- 
traffickers. 
28.  Operation Breakthrough - The GOP blocked the execution 
of this DEA-financed scientific study to estimate cocaine 
production through a cocaine base laboratory efficiency 
study.  The action came despite previous coordination 
between U.S. and Peruvian law enforcement agencies.  Efforts 
are underway to reschedule Operation Breakthrough in 2006. 
 
29.  Money Laundering - The U.S. Treasury's Office for 
Foreign Assets Control (OFAC) continues to maintain Fernando 
Zevallos Gonzales and Aero Continente Airlines on its OFAC 
Kingpin list.  Several former government officials continued 
to be under investigation for money laundering, however the 
Public Ministry has presented no case in court.  Over 30 
money-laundering cases researched by the GOP's Financial 
Intelligence Unit have been forwarded to the national 
prosecutor's office. The Public Prosecutor won two money- 
laundering convictions in 2005.  One case was related to 
public corruption.  The other involved money laundering of 
drug proceeds.  There are three cases currently underway in 
the Peruvian court system. 
 
30. Corruption - As a matter of policy, the GOP does not 
encourage or facilitate the illicit production or 
distribution of narcotic or psychotropic drugs or other 
controlled substances, or the laundering of the proceeds 
from illegal drug transactions. No senior official of the 
GOP is known to engage in, encourage or facilitate the 
illicit production or distribution of such drugs or 
substances, or the laundering of proceeds from illegal drug 
transactions.  Alleged connections (including free airline 
tickets and campaign contributions) between Fernando 
Zevallos and GOP officials and other political leaders are 
under investigation. 
 
31.  Extradition - In May 2005, Peruvian authorities 
approved a request to extradite one narcotrafficker, Ernesto 
Corral Sanchez, from Peru to the United States.  He is 
detained in a Peruvian prison, being tried on separate drug 
trafficking charges.  Jorge "Polaco" Chavez Montoya, a 
priority narco-trafficker with an approved extradition 
request who was enjoying parole, was detained in 2005 and is 
now in jail under separate trafficking charges.  The GOP has 
assured the USG that both drug traffickers will be 
extradited upon completion of their Peruvian judicial and 
penal processes. A Department of Justice team visited Peru 
in 2005 to discuss ongoing extradition requests and improve 
the efficiency of the process. 
 
32.  Demand Reduction - Evidence continues to mount showing 
that illegal drug use is increasing at all levels of 
society.  Marihuana is the most commonly used drug in Peru. 
The most recent national survey (2003) found that among 
people of ages 12-64, four percent have used cocaine HCL at 
least once in their lives, up from two percent in 2002.  In 
an August 2004 survey of university students in Lima, 
marihuana was considered the easiest drug to buy, followed 
by ecstasy, cocaine-base and cocaine HCl.  The data shows 
that availability is contributing to the abuse of illegal 
drugs among the future professionals and leaders of Peru. 
 
33.  With technical assistance from the U.S.-based NGO 
Community Anti-Drug Coalitions of America (CADCA), the U.S. 
Embassy is funding the development of community anti-drug 
coalitions (CAC) in lower-class communities in Lima.  The 
CAC, a highly successful program in the U.S., is being 
adapted to the realities of Peruvian society (e.g., higher 
levels of poverty, weaker institutions, corruption).  The 
CACs will involve people from all sectors of the community 
in long-term, community financed, and sustainable activities 
to reduce drug use and abuse. 
 
34.  Alternative Development Program (ADP)- The ADP 
portfolio is a multi-sector approach to making coca 
reduction sustainable through improving local governance, 
strengthening rule of law and increasing the economic 
competitiveness of coca-growing areas.  At the close of its 
third year, the voluntary eradication (VE) program has over 
26,600 families living in compliant communities, marking an 
important milestone to showing the potential for sustainable 
coca eradication based on popular commitments to live coca- 
free.  In addition, over 9,000 more families have joined the 
program in the past year, which will result in approximately 
3,000 hectares of voluntary coca eradication during 2005, 
and over 11,000 hectares since it began in October 2002. 
35.  The program rapidly accelerated the implementation of 
infrastructure and productive activities in VE communities 
throughout 2005, resulting in the completion of 231 
infrastructure projects and the delivery of technical 
assistance to 26,469 family farmers on over 31,000 hectares 
of licit crops in this year alone.  Assistance in increasing 
licit business activity in alternative development areas 
resulted in $ 4.4M of additional sales in districts where 
voluntary eradication is taking place and $18.6M in the 
seven regions where the ADP is active.  In addition, USAID 
completed the $30M rehabilitation of the Fernando Belaunde 
Terry highway, reducing travel time and corresponding costs 
from twelve to four hours, which is expected to improve 
legal productivity in the former cocalero stronghold of the 
Central Huallaga Valley. 
36.  The implementation of community agreements continues to 
be challenged by organized, well-funded and often violent 
opposition from politically active cocalero groups as well 
as by increasingly active insurgent groups.  Strikes and 
threats of violence substantially slowed program 
implementation this year, forcing the program implementer to 
close regional offices on 21 different occasions for a 
combined period of 119 days. 
37.  Synergies between the development and law enforcement 
components of the coca reduction strategy helped to 
consolidate coca-free areas throughout the coca growing 
valleys of San Martin and Ucayali.  Joint strategic planning 
continued throughout the year and has resulted in plans for 
a first-ever sustainable eradication activity that will 
combine regular eradication efforts with alternative 
development activities and increased government presence to 
maintain cocalero strongholds in the Huallaga Valley coca- 
free.  The GOP carried out eradication in non-compliant 
communities for the first time in FY2005, reaching six 
communities that had maintained coca despite commitments to 
eradicate. 
38.  Efforts to help the GOP establish more effective 
precursor chemical and coca control systems yielded positive 
results in an often negative and, at best, ambivalent 
program environment.    FONAFE, the GOP institution 
responsible for managing parastatal enterprises, took the 
lead in reforming the coca control system in the face of a 
corrupt and inept state enterprise charged with coca 
commercialization in Peru.  Through FONAFE, the GOP 
established the volume of coca going to narco-trafficking 
and an empirical basis for differentiating between legal and 
illegal coca production.  Policy assistance to DEVIDA also 
produced a plan for the use of the state tax agency's 
information technology platform to manage a precursor 
chemical database that will serve the institutions 
responsible for chemical control.  USAID and the Embassy 
have concluded that the adoption of this proposal by the GOP 
is so critical to the success of the control system that, 
without the use of this platform, the impact of the new 
precursor control law will be lost.  The institutions 
responsible for this system have recently agreed to adopt 
this recommendation and appear to be starting on the path 
towards an effective implementation of the control system. 
 
 
Peru Statistics 
(2003-2005) 
 
                              2005           2004      2003 
 
Coca 
 
Net Cultivation (ha)          *    TBD 
31,150 
 * 2005 numbers not yet final 
Eradication (ha)             12,166     12,525 
15,604 
     Forced                   8,966          9,983 
11,313 
     Voluntary                3,200          2,542 
4,291 
 
Cultivation (ha)                  TBD        31,150 
42,466 
 
Leaf (Potential Harvest) (ha)           N/A 
 
HCl (Potential) (mt) 
 
Seizures                      2005      2004           2003 
 
Coca Leaf (mt)                1,424          845       134 
 
Coca Paste (mt)                    N/A       N/A       N/A 
 
Cocaine HCl (mt)                   11.27          7.11 
3.25 
 
Cocaine Base (mt)              4.40          5.70      3.76 
Total Cocaine (mt)            15.67          12.81 
7.0 
 
Opium latex  (kgs)            500.7          285       182 
 
Heroin (kg)                    6.2      1.0       0 
Aircraft (items)                    0        0         0 
 
 
NOTE: Statistics from Peruvian National Police, Anti-Drug 
Office.  2005 figures cover period from Jan 1 - Nov 25. 
STRUBLE 
 
 
 
_______________________________ 
1It's too much of a stretch to say that the eradication in 
VE communities caused others to reconsider the option since 
we didn't really sign up with new communities in Huanuco 
where this took place.  In Ucayali, the Campo Verde 
eradiaction in early 2005 helped clear the way for 
implementation in communities that wanted to join but where 
Los Angeles and Tunuya were causing security and social 
problems.