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U.S. Department of State - Great Seal

U.S. Department of State

Diplomacy in Action

Canada, Mexico, and Central America


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Belize

I. Summary

Belize was removed from the list of major drug-transit countries in 1999 chiefly because of declining estimates of the amounts of drugs transiting there en route to the United States and Mexico, but also due to modest drug seizures over the last three years. Evidence in 2000 did not support a finding that drugs entering the United States from Belize were in an amount sufficient to have a significant effect on the United States. However, Belize's topography and geographic proximity to Mexico and the western Caribbean drug transit routes make it a logical transshipment point for drugs earmarked for delivery to the United States. Therefore, it remains a country of concern.

The Government of Belize (GOB) recognizes this possibility and works closely with the United States on narcotics control and other international crime issues, primarily through the efforts of the Belize Police Department (BPD), the Belize Defense Force (BDF), and the fledgling Maritime Anti-Drug Unit. During the past year, the GOB has increased the size and improved the structure of the BPD, built new and renovated old police stations, and enhanced police equipment and training. Several training programs have been implemented to help the BPD improve its professionalism and capabilities. Belize is a party to the 1988 UN Drug Convention.

II. Status of Country

Belize has a population of approximately 250,000 and a land mass of 8,866 square miles. Contiguous borders with Guatemala and Mexico, large tracts of unpopulated jungles and forested areas, a lengthy unprotected coastline, hundreds of small cayes, and numerous navigable inland waterways, combine with Belize's rudimentary infrastructure to make Belize a potentially significant transshipment point for illicit drugs.

III. Country Actions Against Drugs in 2000

Policy Initiatives. During the year, the GOB created an Anti-Drug Unit within the BPD. This initiative marks the first time a law enforcement unit has been dedicated solely to counternarcotics. The GOB authorized the on-site collaboration of a U.S. law enforcement officer with the new counternarcotics Anti-Drug Unit. U.S. law enforcement training and technical assistance will assist the continued operations of the unit. DOJ/DEA personnel vetted members of this new unit.

The GOB also created the National Drug Abuse Control Council (NDAAC), which developed the nation's first comprehensive drug control strategy with the assistance of the Organization of American States and the European Union. The Ministry of National Security finalized the initial draft of the strategy in 2000. Revisions are pending.

The GOB fully participated in joint counternarcotics operations with the USG, such as Central Skies and Regional Aerial Reconnaissance and Eradication (RARE) missions. Throughout the year, the GOB also carried out its own independent counternarcotics operations.

Accomplishments. According to GOB statistics, in the last year the GOB increased the size of the police department by five percent to 825 officers. The GOB also renovated dozens of police stations country-wide, trained approximately 25 percent of the police force, and acquired equipment and uniforms for enforcement personnel. The GOB and the U.S. signed an Overflight Protocol to the 1992 Maritime Counterdrug Agreement in April, an Extradition Treaty in August, and a Mutual Legal Assistance Treaty (MLAT) in September. The Maritime Agreement is now in force. The extradition treaty, which will mandate the extradition of nationals, has been ratified by both Belize and the U.S., and will enter into force in the near future, as soon as instruments of ratification have been exchanged. The GOB is in the process of ratifying the MLAT. Until the new extradition treaty enters into force, the U.S. and Belize will continue to operate under the 1972 U.S.-UK Extradition Treaty, which applies to Belize. That treaty permits, but does not require, the extradition of nationals, and the GOB has extradited its nationals in the past.

Illicit Cultivation/Production. In the first ten months of 2000, 143,000 marijuana plants were eradicated manually in Belize. Illicit cultivation of marijuana continues to occur in Belize but at reduced levels from the widespread cultivation of a decade ago, when Belize was ranked fourth in worldwide marijuana production. There is no available evidence that marijuana cultivated in Belize has a significant effect on the U.S. Although it is much less prevalent than it was in years past, marijuana remains the most popularly grown drug crop in Belize. Despite their limited resources, the BDF and BPD routinely conduct manual marijuana eradication missions involving, at times, modest-sized fields, ranging from 500 to several thousand plants.

Because of environmental concerns, the GOB does not allow spray missions for the eradication of marijuana. However, it continues to cooperate with and encourage RARE operations. Such missions are followed by BPD and BDF manual eradication of marijuana fields and seedlings, which the GOB views as effective and more environmentally sound.

There are indications that marijuana cultivation is up slightly from last year. Typically, marijuana fields are located in remote regions, far from the homes of the cultivators, so even though thousands of plants were destroyed in various locations, few attendant arrests were made.

Precursor Chemical Control. There is no evidence of traffic in precursor chemicals in Belize. Almost no industry in Belize requires the use of precursor chemicals. However, the GOB in support of the 1988 UN Drug Convention has developed a precursor chemical program. There is no evidence of the production of drugs, other than the cultivation of marijuana, in Belize.

Money Laundering. Money laundering is a potential threat to Belize because of its growing offshore financial sector. (For additional information see the Money Laundering Section).

Asset Seizure. GOB law permits the seizure of assets connected to drug trafficking but to date, none have been seized. Negotiations to implement an International Asset Sharing program in Belize have stalled.

Domestic Programs/Demand Reduction. GOB demand reduction efforts are coordinated by NDACC, which provides drug abuse education, information, counseling, rehabilitation, and outreach. NDACC also operates a public commercial campaign, complete with radio advertisements and billboards, designed to dissuade youths from using drugs. This year, NDACC developed the nation's first comprehensive drug control strategy with the assistance of the Organization of American States and the European Union. The Ministry of National Security finalized the initial draft of the strategy in 2000.

Law Enforcement Efforts. Seizures of cocaine, including crack, in 2000 declined 35 percent from the previous year to 13 kilograms. The authorities also seized 203.3 kilograms of cannabis in 2000. While Belize is a potential transit zone for cocaine, little evidence to confirm the passage of large shipments of cocaine through Belizean waters, except for the occasional single kilogram cocaine packages that wash ashore. Though building its capability, the GOB lacks adequate resources to pursue major maritime interdiction efforts. However, its efforts to eradicate marijuana have been largely successful. The GOB's most serious internal drug problem in Belize is rooted in drug-associated criminality. The newly created Anti-Drug Unit is dedicated solely to handling counternarcotics cases and conducts operations throughout the year. Obtaining convictions remains troublesome as the Office of the Public Prosecutor remains under-trained, under-paid, and poorly equipped. In 2000, the authorities made 2,072 drug-related arrests or detentions.

Corruption. In April 1999, the GOB created an Office of the Ombudsman, which can independently investigate allegations of wrongdoing. The police also have an internal affairs investigator charged with handling complaints against police officers. However, there have been no test cases during the tenure of the current Commissioner of Police.

Agreements and Treaties. Belize has been a party to the 1988 UN Convention since 1996. In March 1997, Belize ratified a stolen vehicles treaty with the U.S. In September 1997, the GOB signed the National Crime Information Center Pilot Project Assessment Agreement, which allows for the sharing of information and data between the U.S. and Belize. In 1992, Belize set the standard for maritime counterdrug cooperation in the region by signing the first Maritime Counterdrug Agreement with the U.S. The GOB and the U.S. signed an Overflight Protocol to the 1992 Maritime Agreement in April 2000, a new Extradition Treaty in August and an MLAT in September.

Drug Flow/Transit. Maritime routes along Belize's lengthy coastline, remote border crossings, and navigable inland waterways are the suspected means for trafficking narcotics through Belize to Mexico, Guatemala, and the U.S. Because of limited seizures of cocaine during the past three years, transit patterns have been difficult to verify.

IV. U.S. Policy Initiatives and Programs

U.S. Policy Initiatives and Bilateral Cooperation. The U.S. strategy in Belize continues to focus on assisting the GOB to develop a sustainable infrastructure, which will allow it to combat its drug problems effectively. In 2000, U.S. support included equipment and training for several units of the police department. U.S. counternarcotics and law enforcement assistance focused on renovating the Belize City Police Station, constructing the Joint Intelligence Coordination Center (JICC), and establishing the new anti-money laundering unit. The U.S. provided equipment and training to the police canine unit, the rapid response force, and the JICC. The U.S. Coast Guard and the U.S. military responded to GOB requests for training and logistics support for counternarcotics activities.

The Road Ahead. With trafficking routes constantly in flux, the potential remains for Belize to become a significant transshipment point for marijuana, cocaine, crystal methamphetamine, and heroin. Marijuana cultivation continues to require monitoring and periodic eradication. After two years in power, the People's United Party continues to rank combating drug trafficking and associated crime as a top priority. U.S. support will focus on building maritime capabilities, supporting police counternarcotic units, and improving Belize's administration of justice.

Canada

I. Summary

Canada, like the United States, is primarily a drug-consuming country. It produces large amounts of high tetrahydrocannabinol (THC) content marijuana cultivated in indoor, increasingly-hydroponic operations, much of which is shipped to the U.S. International drug traffickers attempt to route drug shipments, primarily heroin, cocaine and MDMA (ecstasy), through Canada to the U.S. to take advantage of the long and open Canada-U.S. border, the massive flow of legitimate containerized commerce, and the lower criminal penalties compared with the U.S. Canada is in the process of strengthening its laws and regulations on money laundering and chemical diversion to bring them into compliance with international standards.

The GOC's drug control strategy emphasizes drug abuse prevention and treatment. The law enforcement component emphasizes action against organized crime. Canadian law enforcement officials cooperate closely and actively with their U.S. counterparts on narcotics investigations and interdiction efforts. Canada is a party to the 1988 UN Drug Convention and participates actively in international drug control efforts.

II. Status of Country

Narcotics production, distribution, and use are illegal in Canada. Drugs are smuggled into Canada for domestic use and for transshipment to the U.S. or Europe, and vice versa. Canadian and U.S. law enforcement agencies take this shared problem very seriously, particularly with respect to Asian-sourced heroin, and continue to explore more effective ways to confront it. Since neither government has precise estimates of the amount of illicit drugs transshipped through Canada to the U.S. or from the U.S. to Canada, they are undertaking a comprehensive joint study.

Cocaine, hashish, and Asian heroin continue to enter North America predominantly by sea containers, but also by air and over land. Major ports of entry include Vancouver, Montreal, and Halifax, as well as Toronto's Pearson Airport. Given the long and open U.S.-Canada border, Canada will continue to be targeted by smugglers for potential transit points to and from the U.S. market. U.S. and Canadian law enforcement coordinate closely at all levels to curb trafficking, but recognize that constant vigilance is required. Though the Government of Canada (GOC) is taking steps to address them, money laundering and chemical diversion are also problems in Canada.

While Canada has a relatively low crime rate compared with other countries in the Western Hemisphere, drug trafficking by organized crime has been identified by Canadian law enforcement as a serious problem. Toronto, Canada's largest city, has experienced growing problems with organized criminals from Asia and Russia. Asian-based ethnic groups dominate the heroin trade, alien smuggling, and credit card fraud, which are aimed at the United States as well as Canada. Vancouver, which also has significant Asian gang activity, now suffers from epidemic drug abuse with nearly one death per day from drug overdoses. Criminal motorcycle gang activity, including methamphetamine trafficking, appears to be on the rise nationwide.

According to the Royal Canadian Mounted Police (RCMP), Colombian and Italian-based organized crime and outlaw motorcycle gangs appear to be the single most active criminal groups importing cocaine, though others are involved as well. Shipments arrive via mothership, marine containers, and occasionally by clandestine flights. The RCMP estimates that between 50-100 tons of foreign marijuana, at least 100 tons of hashish (plus six tons of liquid hashish), 15-24 tons of cocaine and at least one ton of heroin are imported into Canada each year, producing up to CAN $4 billion in wholesale profits and CAN $18 billion in street-level profits.

Canada's drug strategy, the third in a series of five-year plans, was issued in 1998. The strategy is comprehensive, addressing all of the foregoing problems. Only approximately 30 percent of its counternarcotics efforts and resources is devoted to law enforcement, however, with the remainder focused on domestic demand reduction. Building on stronger antidrug legislation passed in 1997, the Canadian drug strategy calls for a new targeting imperative on organized crime by the Solicitor General's Office.

III. Country Actions Against Drugs in 2000

Policy Initiatives. Recognizing that Canada's large and diverse financial sector, unprotected by mandatory reporting requirements for suspicious transactions, had become an attractive venue for international money launderers, the GOC passed control legislation in 1999 in response to recommendations of the Financial Action Task Force (FATF). The GOC expects to have the Financial Transactions and Report Analysis Center that the law requires fully operational by mid-2001. The GOC has also tasked Health Canada with developing regulations on precursor chemicals.

Accomplishments. In 2000 (as of November 30), Canadian authorities made 12,186 drug-related arrests (compared with 12,541 in 1999).Canadian law enforcement efforts, often in cooperation with U.S. counterparts, resulted in the interdiction of numerous large-scale narcotics shipments and the wholesale disruption of trafficking organizations. In November 2000, in a joint investigation, several traffickers and airline employees were arrested for using Pearson Airport in Toronto to ship drugs from South America to Canada. On June 13 the RCMP arrested 45 traffickers involved in an organized ring transporting marijuana from Ontario and Quebec to New York via the Akwesasne Reservation.

Canadian authorities several times seized large caches of heroin. On June 11, 1,100 grams were seized in Vancouver, British Columbia. On September 2, 99 kilograms from a container arriving from the People's Republic of China were seized in Vancouver, British Columbia. Fifty-seven kilograms hidden within a shipment of preserved duck eggs, together with 17 kilograms of MDMA were seized in Toronto, Ontario on September 4. Six hundred grams were seized from a courier on a flight from Frankfurt, Germany to Toronto on September 29. The courier resided in Detroit, Michigan.

Canadian authorities made significant drug seizures throughout the year, principally at airports and seaports, many as a result of joint investigations with the U.S. Drug Enforcement Administration. Joint investigations involving the RCMP and DEA resulted in the seizure of several cocaine shipments of 1,000 and 1,206 kilograms in Florida and the Bahamas organized by traffickers in Toronto and destined for locations in the U.S. and Canada. Traffickers went to considerable lengths to evade detection; one 48 kilogram cocaine shipment was discovered in a container arriving from South Africa to Vancouver, British Columbia.

Canadian authorities seized large caches of cannabis and hashish, e.g., approximately ten tons of hashish were seized in January 2000 from a container arriving in Montreal from Dubai. Another ten tons of hashish bound for Montreal was seized in Newark by the DEA. Both shipments were organized by Canadian based trafficking organizations. In July, 1,000 kilograms of hashish and 22 kilograms of hash oil were seized at a home in Blainville, Quebec. In Montreal, another 200 kilograms of hashish were discovered in a container arriving from the Netherlands and 171 kilograms were found in Ontario. Canadian authorities seized numerous MDMA (ecstasy) shipments arriving from such destinations as the Netherlands and Bulgaria, and closed several laboratories, including a residential lab in Ontario with an estimated production capacity of 400,000 dosage units.

Based on information provided by a chemical supply house in the Toronto area concerning a suspicious purchase of hydriodic acid, a precursor chemical for producing methamphetamine, the RCMP conducted a successful investigation against a methamphetamine trafficking group. Working with DEA, the RCMP arrested a trafficker and seized a cache of methamphetamine precursors. The defendant was a U.S. parole violator with close ties to the California Hells Angels.

Law Enforcement Efforts. During 2000, Canadian authorities continued to implement the five-year antidrug strategy issued in 1998. The strategy recognizes the growing threat from transnational organized crime, particularly narcotics traffickers, and directs a concerted effort against it. In 2000, the GOC increased funding to fight organized crime, largely through enhanced intelligence.

While the RCMP has mounted effective operations against narcotics and other criminal organizations, Canadian courts have been reluctant to impose tough prison sentences reflecting a widespread view that drugs are a "victimless" crime and should be treated primarily as a health issue. The Canadian Supreme Court has questioned the legality of police involvement in "sting"-type operations, undercover "buys" and other techniques now commonly used around the world in drug investigations, largely on privacy grounds, as a potential violation of the 1982 Canadian Charter of Rights and Freedoms.

Corruption. Canada holds its officials and law enforcement personnel to very high standards of conduct and has strong anticorruption controls in place. Government personnel found to be engaged in malfeasance of any kind are removed and subject to prosecution.

Agreements and Treaties. Canada is a party to the 1988 UN Drug Convention. The U.S. and Canada have numerous long-standing agreements on law enforcement cooperation, including extradition and mutual legal assistance treaties, a customs mutual assistance agreement, and an asset sharing agreement. In 1998, the RCMP became the first foreign law enforcement organization to be afforded access to the El Paso Intelligence Center (EPIC), the USG's tactical drug intelligence center.

Canada actively participates in international antidrug fora including: the UNDCP, the Inter-American Drug Abuse Control Commission of the Organization of American States (CICAD), the Dublin Group, the Financial Action Task Force, and other groups. It is also an active participant in the Multilateral Evaluation Mechanism (MEM), a hemispheric peer review system to evaluate each member state's antidrug strategies and efforts. Canada chaired the negotiation process that designed the MEM. The GOC is a major contributor to both the UNDCP and CICAD, both in funding and technical support. It was among the first signatories to the UN Convention Against Transnational Organized Crime and its protocols on trafficking in persons and smuggling of migrants, which were approved in December.

Cultivation and Production. Cannabis products continue to be the drug of choice among Canadian drug users. Both hashish and marijuana are readily available and widely consumed among drug users. Marijuana growers are turning away from conventional outdoor cultivation to utilize greenhouses or hydroponic facilities. Indoor growing facilities have increased the tetrahydrocannabinol (THC) level of hydroponic marijuana (estimated to be between 10-20 percent), and hydroponic marijuana is in demand by Canadian and U.S. consumers. The increase in demand coupled with high profits from sales, low start up costs and ease of operation have made marijuana cultivation attractive to criminal groups, particularly organized motorcycle gangs, which have affiliates in major metropolitan areas such as Vancouver, Toronto and Montreal. Unlike the United States, hashish also finds a broad market in Canada.

According to Canadian authorities, marijuana cultivation in British Columbia is a sophisticated, one billion-dollar-a-year growth industry with a sizeable amount of the harvest being smuggled into the U.S. A pound of high-grade marijuana smuggled into California will sell for 600 percent of its wholesale value in British Columbia. U.S.-produced marijuana is also imported into Canada, although the amount is not known.

During 2000, Canadian authorities cracked down on the production of MDMA, PCP and GHB. A number of clandestine MDMA laboratories have been located in major population areas including Toronto, Vancouver and Montreal. Outlaw motorcycle gangs and other Montreal criminal groups specialize in the manufacture of "ecstasy" MDMA/PPMA. Recent search warrants targeting outlaw motorcycle gangs have recovered large quantities of MDMA along with cocaine. Laboratories manufacture from one to five kilograms at a time, with a yield of approximately 10,000 tablets per kilogram. PCP manufacturing mostly occurs in or near Quebec City in laboratories managed by outlaw motorcycle gangs. GHB manufacturing also takes place in the Toronto area. Manufacturing of GHB and other synthetic drugs is relatively simple and two companies in Quebec and Ontario offer complete manufacturing kits on the Internet.

Domestic Programs. Based on Canadian government estimates, there are approximately 1,000,000 drug users in Canada, including some 250,000 cocaine addicts and 40,000 heroin addicts. Canada emphasizes demand reduction in its drug control strategy and, along with non-governmental organizations, offers extensive drug abuse prevention programs. The focus on prevention is considered a more cost-effective intervention. There are substantial regional differences in the patterns of drug abuse. For example, Vancouver struggles with heroin overdose deaths while Native American communities in the prairie provinces are plagued with propane and glue-sniffing.

IV. U.S. Policy Initiatives and Programs

Bilateral Cooperation. Canadian and U.S. law enforcement have an extensive cooperative relationship, perhaps the closest and most productive of our international partnerships. Strong cooperation exists not only at the federal level, bilaterally and multilaterally, but at the state and local level as well. The principal bilateral cooperative forum is the annual Cross-Border Crime Forum which engages policymakers in a joint effort to guide that relationship and to enhance coordination. Its working groups continue to identify areas and priorities, such as intelligence sharing, where we can better advance our common goals. Operation North Star is an ongoing mechanism for operational coordination. The two governments have a broad array of agreements in place to facilitate legal cooperation, such as the extradition and mutual legal assistance (MLAT) treaties, and an information sharing agreement between the U.S. DEA and the RCMP. Canada is by far the United States' principal extradition partner.

To further enhance this unparalleled relationship, the USG is committed to:

  • supporting Canadian efforts to strengthen legislation and regulatory practices consistent with international standards and practices;
  • maintaining and expanding two-way intelligence sharing;
  • maintaining and expanding professional exchanges and cooperative training activities between our law enforcement agencies; and
  • maintaining joint cross-border investigations and operations.

The Road Ahead. The United States looks forward to continuing its already excellent law enforcement partnership with Canada at both the bilateral and international level. The GOC has taken and continues to take important steps to enhance the capabilities of Canadian law enforcement to confront the growing threat of international organized crime, drug trafficking and money laundering in Canada. However, sentencing guidelines, together with stronger judicial and public support, would increase the impact of the GOC's law enforcement efforts and create a stronger deterrent to transnational crime.

Costa Rica

I. Summary

Costa Rica is a transshipment point for the smuggling of cocaine and heroin from South America to the United States and Europe. Although Costa Rica is not a major transit country for drugs coming to the United States, it remains a country of concern to the U.S. The bilateral Maritime Counterdrug Cooperation Agreement, which entered into force in late 1999, has improved the ability of the United States and Costa Rica to combat maritime drug smuggling. In 2000, Costa Rica enacted legislation to establish a professional coast guard service. Costa Rica is a party to the 1988 UN Drug Convention.

II. Status of Country

Costa Rica's strategic location on the Central American isthmus makes the country an attractive transshipment and staging area for shipments of South American-produced cocaine and heroin destined for the United States and Europe. Enhanced land interdiction capabilities caused drug traffickers to abandon traditional overland routes and redirect their illicit cargo to points north via maritime and air assets. Cocaine seizures by Costa Rican authorities fell for a second year in 2000 compared to the record seizures of 1997-98. Legislation enacted in May 1998 addressed many of the major loopholes in the Costa Rican banking system and created a Financial Investigative Unit (FIU). Costa Rica does not produce controlled precursor or essential chemicals. The importation and distribution of such chemicals and prescription drugs are subject to a stringent governmental licensing process. Costa Ricans are increasingly concerned over local consumption of illicit narcotics, particularly crack cocaine, and the violent crimes associated with drug use and trafficking. The GOCR's adoption of strict antidrug measures is an attempt to meet the serious threats posed by narcotics trafficking. Resource limitations continue to constrain enforcement.

III. Country Actions Against Drugs in 2000

Policy Initiatives. The GOCR was the first Central American country to sign a comprehensive six-part bilateral Maritime Counterdrug Cooperation Agreement with the U.S. The Costa Rican Legislative Assembly passed the Coast Guard Professionalization Law in May 2000. This law establishes an autonomous budget with higher salaries and addresses personnel professionalization through increased requirements for admission to the soon-to-be established Coast Guard Academy and institutes officer and enlisted career tracks. Under the new law, the Coast Guard is responsible for maritime law enforcement operations (counternarcotics, fisheries, immigration, and arms trafficking), protection of natural resources, port security, and maritime search and rescue.

Proposed legislation currently under consideration in the Legislative Assembly would create a Costa Rican Counternarcotics Institute, which would facilitate coordination of the GOCR's efforts in counternarcotics intelligence, demand reduction, asset seizure, and precursor chemical licensing. The legislation would expand current money laundering measures to include offenses that are not strictly narcotics-related (for additional information please money laundering section). Furthermore, the proposed legislation would address identified gaps in the internal control of precursor and essential chemicals.

Implementation of the Criminal Procedures Code, enacted in January 1998, has enhanced cooperation between the Judicial Investigative Police and the Public Prosecutor's Office.

Accomplishments. Relations between U.S. law enforcement agencies and GOCR counternarcotics organizations, including the Judicial Investigative Police Narcotics Section and the Ministry of Public Security Drug Control Police, remain close and productive, resulting in regular information sharing and joint operations. Costa Rica hosted four joint operations under the auspices of the USG-coordinated regional operation known as "Central Skies-Operation Chokehold." Central Skies Operations have resulted in the destruction of over 4.2 million marijuana plants to date. Helicopters and aircrews of Joint Task Force Bravo deployed from Soto Cano Air Base, Honduras, supported these eradication operations. Additionally, the maritime component of these joint operations has resulted in 235 boardings, seizure of 30 kilograms of cocaine and two go-fast vessels, the first successful prosecution of a maritime pollution case, detention of six vessels for illegal fishing, and the integration of the Air Surveillance Section of the Ministry of Public Security for counterdrug detection and monitoring flights.

The Drug Department of the Ministry of Public Health operates an effective program to license the import and distribution of precursor and essential chemicals and prescription medicines. It is currently seeking to improve the control of the re-sale of precursors within Costa Rica, as well as re-exportation.

Law Enforcement Efforts. The primary counternarcotics agencies in Costa Rica are the Judicial Investigative Police, under the Supreme Court, and the Ministry of Public Security's Drug Control Police. The Judicial Investigative Police operate a small, but highly professional, Narcotics Section that specializes in investigating international narcotics trafficking. The Drug Control Police investigate both domestic and international drug smuggling and distribution and is responsible for airport interdiction as well as land-based interdiction at the primary ports of entry. Both entities routinely conduct complex investigations of drug smuggling organizations, resulting in arrests and the confiscation of cocaine using the full range of investigative techniques permitted under the country's progressive antidrug statutes, including use of wiretaps, controlled deliveries, and undercover agents. Information obtained during investigations by GOCR judicial authorities displays evidence that use of Costa Rica's wiretap law has disrupted criminal organizations, making those organizations increasingly more guarded in their communications and more likely to use pay telephones or pre-paid cards and to switch cellular phones on a more frequent basis. Evidence gathered under the Costa Rican wiretap law has also facilitated narcotics prosecutions in the United States.

Costa Rica does not have an expeditious asset forfeiture procedure. Current law does not put the burden of proof on the defendant to prove legitimate purchase of assets. The development of a comprehensive asset forfeiture procedure would facilitate law enforcement efforts and could potentially provide the GOCR with a much-needed source of income and/or assets in support of such efforts.

Corruption. President Rodriguez has worked to deter corruption among public officials. U.S. law enforcement agencies consider the public security forces to be full partners in counternarcotics investigations and operations with little or no fear of compromise to on-going cases. The Minister of Public Security dismissed 21 personnel from the maritime service for corruption and incompetence following the recent passage of the Coast Guard Professionalization Law.

Agreements and Treaties. The six-part bilateral Maritime Counterdrug Cooperation Agreement is the most comprehensive agreement of its kind in the region. The agreement is designed to promote closer cooperation in the interdiction of maritime smuggling. At the same time the Maritime Agreement was signed, the U.S. and Costa Rica also signed a Memorandum of Understanding (MOU) on Maritime Cooperation and Assistance. The United States agreed in the MOU to take steps toward securing equipment, and technical and training assistance for the Costa Rican Coast Guard. The GOCR and the Netherlands are co-sponsoring an effort to establish a regional maritime counterdrug agreement for Caribbean and Central American countries. The draft, based on a Costa Rican model of the USG six-part maritime agreement, is being circulated among interested countries for review. Formal negotiations began in 2000.

Both the U.S. and Costa Rica have ratified the bilateral Stolen Vehicles Treaty concluded in 1999. The U.S.-Costa Rican extradition treaty entered into force in 1991. Although Costa Rican law does not permit the extradition of nationals, the treaty is used on a regular basis to extradite non-Costa Rican national. Costa Rica is a party to the 1988 UN Drug Convention and all other UN narcotics agreements. Costa Rica and the U.S. are also parties to bilateral drug information and intelligence sharing agreements dating from 1975 and 1976. Costa Rica is a member of the Caribbean Financial Action Task Force and the Egmont Group.

Cultivation and Production. Cannabis cultivation is relatively small-scale and generally found in remote mountainous areas near the Panamanian border, in the Caribbean region near Limon and Talamanca, and the Valle del General on the southern Pacific coast. Such cultivation is sometimes intermixed with legitimate crops. There is no evidence of the export of cannabis from Costa Rica. Costa Rica does not cultivate other illicit drugs. No clandestine cocaine laboratories have been detected in Costa Rica since 1986.

Drug Flow and Transit. Overland shipments of illicit narcotics transiting Costa Rica are more likely to be transported in smaller vehicles than in the tractor-trailers that drug traffickers used before 1999. Historically, overland shipments would proceed to San Jose for temporary storage prior to consolidation or re-packing for transit northward. Current information indicates that such shipments are being moved directly from the southern to the northern border as quickly as possible, and then are being passed into Nicaragua. The recent trend of trafficking narcotics by maritime routes has continued. The narcotraffickers avoid overland routes by using go-fast vessels to transport drugs by way of the Pacific Ocean and Caribbean. Costa Rican internal drug use is mostly limited to marijuana, cocaine, and crack. However, the club drug MDMA, also known as ecstasy, is available and increasing in popularity among young adults. LSD has also been detected. The dramatic decline in the availability of cocaine at the street level, as reported last year by the Judicial Investigative Police, appears to be a sustained trend with street prices for cocaine continuing to rise. This can partially be attributed to the current preference by traffickers of directing their shipments into Guatemala and Mexico, avoiding the rest of the isthmus.

Demand Reduction. Costa Ricans have become increasingly concerned over local consumption, especially of crack cocaine. Abuse appears highest in the Central Valley (including the major cities of San Jose, Alajuela, Cartago, and Heredia), the port cities of Limon and Puntarenas, the north near Barra del Colorado, and along the southern border. The National Drug Prevention Council (CENADRO) oversees drug prevention efforts and educational programs throughout the country, primarily through well-developed educational programs for use in schools and community centers. CENADRO also serves as the custodian for assets seized from narcotics traffickers. The Costa Rican Drug Abuse Resistance Education (DARE) Foundation, modeled after its U.S. counterpart, conducts drug awareness programs at over 500 public and private schools, and is considered one of the top international DARE programs. The DEA's Costa Rica office collaborated with DARE Costa Rica in November in conducting the first Red Ribbon Campaign outside the United States.

IV. U.S. Policy Initiatives and Programs

U.S. Policy Initiatives. U.S. counternarcotics goals in Costa Rica aim to reduce the transit of drugs to U.S. markets. Objectives include reducing the flow of illicit narcotics through Costa Rica, enhancing the effectiveness of the criminal justice system, reducing the use of Costa Rica as a money laundering center by strengthening enforcement of recently approved controls against such activities, and supporting efforts to locate and destroy marijuana fields. Specific objectives include: continuing to implement the bilateral Maritime Counterdrug Cooperation Agreement; enhancing interdiction of drug shipments by improving the facilities and training personnel at the northern border crossing of Penas Blancas; enhancing the ability of the Air Section of the Public Security Ministry to respond to illicit drug activities by providing equipment and technical training; improving law enforcement capacity through providing specialized training and equipment to the Judicial Investigative Police Narcotics Section, the Drug Control Police, Joint Counternarcotics Intelligence Center (CICAD), the National Police Academy, and the Customs Control Police; and to increase public awareness of dangers posed by drug use through assistance to Costa Rican demand reduction programs and initiatives.

The single border crossing between Costa Rica and Nicaragua at Penas Blancas provides a unique opportunity for law enforcement officials to reduce northbound overland cocaine trafficking through Central America via the Pan American Highway. There are no secondary crossing points or alternative routes on the Costa Rican-Nicaraguan border to bypass the main check point. The U.S. Embassy is working with GOCR law enforcement authorities to establish enhanced port-of-entry/exit facilities for greater border control. This facility will have the potential for future expansion to allow for southbound inspections seeking traffic in illegal arms, currency, precursor chemicals, and stolen equipment.

The Department of State allocated $1.9 million from the Colombia Interdiction and Alternative Development Supplemental appropriation for expanded assistance to the Costa Rican Coast Guard as outlined in the MOU signed along with the Maritime Agreement. This assistance is designed to enhance Costa Rican and U.S. maritime security through the development of a professional Coast Guard. Plans include acquiring eight small boats, supporting the transfer of a second U.S. Coast Guard Point Class cutter, providing advanced professional and technical training for GOCR personnel, and assisting with the renovation of three Coast Guard stations on the Pacific coast.

Bilateral Cooperation. The U.S. Department of State's Bureau of International Narcotics and Law Enforcement (INL) sponsored numerous technical assistance and training programs for Costa Rican officials during 2000. Regional training opportunities included the extensive U.S. Customs Service Integrity and Risk Assessment series and several INL-sponsored FBI professional development seminars with topics ranging from stolen vehicles to media relations. INL and DEA sponsored a Costa Rica-specific money laundering seminar for public and private institutions and officials as well as an advanced training seminar on precursor chemicals. INL funding supported the participation of 12 Coast Guard personnel in a three-month training course in patrol boat operations at the U.S. Navy Small Craft Instruction and Technical Training School in early 2000; a two-week Port Security Program for 52 GOCR officials from five GOCR law enforcement agencies in June; and a follow-on Port Security and Container Inspection Program in September.

The U.S. Embassy San Jose and U.S. Southern Command sponsored the first Regional Summit on Anti-Corruption and Counterdrug Activities for 160 government representatives from Central America and Mexico, on February 24-25, 2000, and the first Central American Patrol Boat Commanders Conference, on May 17-19, 2000. Both conferences promoted the broader U.S. objective of encouraging greater counternarcotics cooperation with and among the Central American countries.

The U.S. purchased specialized surveillance gear and related computer equipment for the Judicial Investigative Police Narcotics Section and the Drug Control Police to assist in narcotics investigations. The U.S. also acquired upgraded computer equipment for the Public Prosecutor's Narcotics Section and the Ministry of Public Health's Precursor Chemicals Unit. CICAD also received technical equipment to support the implementation of Guardian software and the Financial Analysis Unit.

The Road Ahead. U.S.-GOCR cooperation will intensify with the recent allocation of funding for the development of the Costa Rican Coast Guard and as the U.S. assists in enhancing Costa Rica's capabilities to engage in the joint operations contemplated by the bilateral Maritime Counterdrug Cooperation Agreement. The United States seeks to improve GOCR capabilities to curtail the use of Costa Rica as a narcotics transshipment and temporary storage area, discourage drug consumption, and fight money laundering. The U.S. will cooperate with the GOCR in its efforts to professionalize its public security forces and implement and expand the strict controls against money laundering enacted in 1998.

El Salvador

I. Summary

El Salvador is a transit country for narcotics, mainly cocaine, moving to the U.S., although evidence in 2000 did not support a finding that drugs coming into the U.S. from El Salvador were of sufficient quantity to have a significant effect on the U.S. Although it is not a major transit country for drugs coming to the United States, El Salvador remains a country of concern to the U.S. Local consumption is on the rise, and law enforcement agencies have noted a significant increase in the production and sale of low-cost crack cocaine. Under the guidance of President Francisco Flores, the Government of El Salvador (GOES) has established Grupo Cuscatlan, an interagency counternarcotics coordination group which includes the military and civilian agencies. El Salvador participated in two joint eradication/training efforts with the U.S. in 2000, Operation Pelican and Central Skies, in addition to participating in a regional narcotics interdiction exercise called Operation Liberator. The Anti-Narcotics Division (DAN) of the National Civilian Police (PNC) continues to improve its professional capability, and the Joint Intelligence Coordination Center (JICC) is expanding its interaction with EPIC. The GOES has been purging its National Police of officers suspected or accused of crimes or corruption, and a similar process is now underway in the Attorney General's Office and the court system.

The GOES approved in record time a U.S. request to establish a Forward Operating Location (FOL) in El Salvador's main airport. The FOL has already provided valuable interdiction information against Pacific traffickers. Using funds approved by Congress as part of Plan Colombia, and building on programs begun using relief funds from Hurricane Mitch, the United States is working with the GOES to strengthen existing capabilities to fight corruption, reduce the transit of illegal contraband, and erect barriers to alien smuggling. Where those capabilities are non-existent or in a fledgling state, U.S. assistance is enhancing institutional abilities.

The GOES Financial Investigation Unit began operations in 2000, a major step in the implementation and enforcement of its 1998 money laundering legislation. The GOES has an interagency group providing oversight to efforts to address the problem of precursor chemicals, and the U.S. continues to provide training to further develop expertise in this area. El Salvador is a party to the 1988 UN Drug Convention.

II. Status of Country

Cocaine seizures in El Salvador remain far short of those in neighboring countries, and the quantities seized likely do not reflect the true level of trafficking. The Pan American and Litoral Highways have been major transit routes, and there is some evidence of increased transit via the seaport of Acajutla en route to ports in Guatemala and Mexico, where they are staged for further transport to the United States. El Salvador produces only small quantities of cannabis for domestic consumption. The installation of a new air traffic control radar has helped reduce unregistered air traffic through Salvador air space. A new border crossing station at the border with Honduras will help reduce trafficking on that part of the Pan American Highway, and a strengthened national K9 program should help reinforce interdiction efforts. The GOES continues to move actively against potential money laundering, expanding its efforts to encompass casinos and money exchange houses, in addition to commercial banks. (For additional information se Money Laundering Section)

III. Country Actions Against Drugs in 2000

Policy Initiatives. The GOES created Grupo Cuscatlan, an inter-agency cooperative body incorporating civilian law enforcement and military elements. The director of the National Civilian Police (PNC) instituted an ongoing internal investigation which is sharply reducing the number of corrupt police, and he is further improving screening and training procedures for new recruits. Although PNC drug seizures increased moderately over 1999, the Director was unable to meet the sharp increase he had projected. As a result, he has vowed that the PNC will redouble its efforts in the coming year. The GOES also initiated an internal investigation of the Attorney General's Office and the courts aimed at purging corrupt elements.

Accomplishments. El Salvador participated in two joint eradication/interdiction/training exercises with the U.S. in 2000, Operation Pelican and Central Skies. It also participated in the first combined maritime operation, Operation Accion Aliado. U.S. law enforcement and military officials participating in these exercises and operations praised the high degree of cooperation from the Salvadoran police and military participants, and noted the good internal Salvadoran interagency cooperation resulting from coordination provided by Grupo Cuscatlan. Salvadoran police and enforcement authorities also took part in a regional coordination/training exercise, Operation Liberator. A new border crossing inspection station will be constructed in 2001 to improve border controls with Honduras. The FOL began operating in 2000. The Legislative Assembly is considering a package of legislative changes, including wiretap authorization and organized crime provisions. The Vice President announced the establishment of a code of government ethics. The Salvadoran legislature approved a constitutional amendment permitting the extradition of nationals.

Law Enforcement Efforts. The 422 kilograms of cocaine seized in 2000 represents a significant increase from 1999's 23.8 kilograms and 1998's 42 kilograms. Cannabis seizures in 2000 totaled 451 kilograms, an increase from the seizure of 280.8 kilograms in 1999. If the Legislative Assembly passes proposed laws currently under consideration, the police would be granted powers that could significantly expand their ability to conduct investigations and effect seizures. Under the auspices of Grupo Cuscatlan, Salvadoran military assets are now being used in ground, air, and maritime capacities in support of antinarcotics operations.

Corruption. The GOES has been active on a variety of fronts in the fight against corruption. In 2000, the Vice President announced a code of government ethics. The police, Attorney General's Office, and the courts all are involved in an anticorruption based restructuring which should result in a more reliable, professional, and transparent legal system. The PNC's Internal Investigations Unit has been established, as has the Office of Crimes Against the State in the Attorney General's Office. The U.S. will continue to assist with training for all these institutions to support the ongoing anticorruption initiatives.

Agreements and Treaties. The GOES approved in record time an agreement to allow the U.S. to establish a Forward Operating Location (FOL) on the military side of Comalapa Airport. The Salvadoran legislature approved a constitutional amendment allowing the extradition of Salvadoran nationals. As a result, the U.S. and El Salvador anticipate entering into negotiation in 2001 of a modern extradition treaty to replace the current extradition treaty dating from 1911. The U.S. and Salvadoran governments also are actively discussing maritime and stolen vehicles treaties which could be signed in 2001. The GOES is a party to the 1988 UN Drug Convention. In December 2000, El Salvador signed the UN Convention Against Transnational Organized Crime.

Drug Flow/Transit. Illegal drug traffic appears to move through El Salvador on the Pan American and Litoral Highways. Small boats may be in use for regional trafficking, and large shipments likely transit the seaport of Acajutla on the way to ports in Guatemala and Mexico. Intelligence suggests substantial trafficking by "mother-ships" and go-fast boats bypassing Salvadoran waters. Unregistered traffic by small planes through Salvadoran airspace has been significantly decreased by the installation of a new, more powerful radar at Comalapa Airport and interdiction cooperation between the military, the port authority, and the PNC.

Domestic Programs/Demand Reduction. Local drug consumption, particularly of crack, continues to increase in El Salvador. "FUNDASALVA," El Salvador's premier substance abuse institution, plans to launch a demand reduction public education advertising campaign in 2001, with U.S. assistance. There are domestic treatment programs in place, including in small urban centers. The Drug Abuse Resistance Education (DARE) program has been given new resources by the PNC director.

IV. U.S. Policy Initiatives and Programs

U.S. Policy Initiatives. The U.S.' broad-based efforts in El Salvador are designed to strengthen and further professionalize the PNC, especially the Anti-Narcotics Division (DAN), to increase Salvadoran capability to combat money laundering, and to ensure a transparent and professional criminal justice system.

Bilateral Cooperation. In 1999, El Salvador received $950,000 in supplemental Hurricane Mitch funds, which were allocated to support ongoing anticorruption efforts, including the new PNC Inspector General's Internal Affairs Unit ($300,000), the Attorney General's Office of Crimes Against the State ($300,000), and the establishment of an independent Office of Government Ethics ($350,000). In 2000, El Salvador received a $3 million allocation from the Plan Colombia supplemental legislation, which will fund a variety of antinarcotics projects including: the establishment of an interagency antinarcotics operations center headed by the DAN; the provision of communications equipment for the PNC, the DAN and border police; the construction of DAN substations at remote entry points; new maritime interdiction equipment; and specialized training for judges, police and prosecutors. The U.S. Coast Guard has agreed to transfer an 82-foot patrol boat in May 2001 and anticipates donating additional naval assets to improve maritime interdiction.

The Road Ahead. The establishment of Grupo Cuscatlan, the government's anticorruption initiatives, and the increasing professionalism of Salvadoran law enforcement and military participants in joint U.S. exercises are important steps in improving antinarcotics efforts. New naval assets will enhance maritime interdiction capabilities. In the coming year, the U.S. will work with the GOES to improve detection and interdiction at the borders, particularly with Honduras, and at the port of Acajutla. The new border crossing station, a revitalized K9 program, and expanded and increasingly specialized training will head the U.S.' agenda in 2001. The U.S. will continue to work with the Legislative Assembly and the GOES to ensure passage of a new package of legislation granting the police broader and stronger authorities. The U.S. also will work toward signature of maritime, extradition, and stolen vehicles treaties.

Guatemala

I. Summary

Guatemala remains a major drug-transit country for South American cocaine en route to the United States and Europe. Cocaine is moved through Guatemala by air, road, and in seagoing vessels of all types. In 2000, U.S. Government (USG) law enforcement agencies worked closely with the Government of Guatemala (GOG) to increase law enforcement capabilities to counter the constant flow of drugs transiting the country. Seizures declined significantly due to the tremendous turnover in personnel in law enforcement and other GOG agencies, an acute lack of resources, and widespread corruption. Professionalization of the National Civilian Police's Department of Anti-Narcotics Operations (DOAN), the main Guatemalan counternarcotics force, is a prime objective of the Government. The GOG is working, with USG assistance, to develop effective, integrated law enforcement and counternarcotics training programs to continue to improve the quality of the DOAN and to enhance interdiction and eradication operations. There are also efforts to improve the training for narcotics prosecutors. The GOG has a growing domestic consumption problem and supports a very active demand reduction program.

The GOG has yet to seriously consider enacting comprehensive money laundering legislation and has not positively responded to U.S. overtures for a comprehensive six-part maritime counternarcotics agreement. Guatemala is a party to the 1988 UN Drug Convention.

II. Status of Country

Guatemala is the preferred country in Central America for storage and consolidation for onward shipment of cocaine to the United States. U.S. estimates indicate that over 300 metric tons of cocaine are shipped through the Central American corridor to Mexico and the United States annually. Guatemalan law enforcement agencies interdicted close to one-and-a-half metric tons of cocaine in 2000. This was a significant drop from the previous year's ten metric tons even though narcotics-related arrests almost doubled to 842. Crack seizures rose sharply, highlighting the marked increase in domestic consumption apparently caused by the narcotraffickers paying for transportation services with drugs rather than money.

Cocaine seizures declined because of widespread corruption, high turnover of law enforcement personnel at all levels, and a lack of financial support from the incoming administration. Since the Portillo administration took office in January 2000, there have been four different directors of DOAN. This turnover has made long-range planning for operations and investigations nearly impossible and the formation of working relationships very difficult. With only limited air assets, the Guatemalan police have lacked an airlift capability to support their eradication and drug interdiction efforts. They often have trouble providing even basic equipment and provisions to the DOAN agents in the field. This is exacerbated by their expansion of recent years into more areas of the country. Corruption is endemic in all sectors and levels of the government and hindered counternarcotics operations during 2000.

The DOAN, which receives significant training and support from the USG, is considered to be one of the best-trained and armed units in the National Civilian Police (PNC). Along with other GOG entities, it regularly cooperates with U.S. law enforcement agencies in combating narcotrafficking. However, it too has been adversely affected by constant turnover and a shortage of resources.

The Public Ministry's special narcotics prosecutor's offices, which receive USG training and assistance, continue to try cases and achieve convictions for minor narcotics offenders. Unfortunately, success in prosecuting major narcotraffickers has been limited. Intimidation, lack of resources, and corruption in the judiciary are the primary reasons for the lack of success in prosecuting and convicting major traffickers.

Guatemala grows minimal quantities of opium poppy and marijuana. Apart from crack and marijuana for local consumption, narcotics are generally not processed in Guatemala.

Guatemala has yet to pass any money laundering legislation due to major resistance from the banking and other sectors. The banking sector has very strict secrecy laws and allows the use of bearer shares.

Diversion of precursor chemicals is considered to be a growing problem in Guatemala. While the GOG has legislation identifying 46 precursor chemicals, it has yet to pass the implementing regulations that would make the legislation useful for enforcement and prosecution purposes. However, the GOG was successful in making one major precursor chemical seizure using the precursor chemical provisions provided for in the 1988 UN Drug Convention.

The GOG has an aggressive demand reduction program aimed at a growing substance abuse problem. As part of its five-year master plan adopted in 1998, Guatemala's National Drug Coordinating Agency, SECCATID, has continued to work very closely with the USG and international organizations, including the UN and the OAS, in providing seminars, surveys, and education designed to decrease consumption and raise public awareness about the plague of consumption and narcotrafficking.

III. Country Actions Against Drugs in 2000

Policy Initiatives. In the year 2000, Guatemala signed three Letters of Agreement (LOAs) with the USG on counternarcotics and demand reduction. The GOG increased DOAN staffing and is currently recruiting a limited number of agents for new posts in some of the more remote areas of the country. The GOG, with U.S. assistance, has continued to improve the DOAN headquarters facility, along with the planning, command and control center, and a number of satellite offices. A major accomplishment was the recent activation of a direct communications link to U.S. counternarcotics information tracking services. It is hoped that this U.S.-funded initiative will allow the DOAN staff to plan and execute more effective counternarcotics operations.

In early 2000, the Guatemalan Congress decided that all U.S. military antinarcotics operations on Guatemalan soil required its advance approval. However, in August 2000, the Congress modified this decision by approving legislation that provided a blanket one-year authorization for such operations.

The Guatemalan Supreme Court, with U.S. assistance, has established a new program of special courts that will be staffed with the best qualified personnel available to handle sensitive cases that regular courts cannot. Two of these courts have already opened and one more is slated for the year 2001.

Accomplishments. Even though seizures decreased significantly in comparison with previous years, there were important seizures. In April 2000, DOAN seized 797 kilograms of cocaine that were concealed in electrical transformers. Information provided by the U.S.-supported Port Security Program (PSP) played a role in realizing this seizure. In March 2000, DOAN was able to seize a small aircraft with 214 kilograms of cocaine. This last year also saw the PNC and DOAN dismantle a large drug trafficking ring located in the Guatemala City International Airport.

Various USG agencies have also begun working with DOAN on forming a rapid response team that will randomly visit the ports, land border entry points, and highway checkpoints in an effort to increase seizures. The USG provided polygraph training to five PNC agents who are the nucleus of a vetting unit that will provide the PNC and DOAN an important and previously unavailable tool.

Illicit Cultivation and Production. While there has been no recent aerial reconnaissance to accurately evaluate the growing areas, the USG believes illicit cultivation is still quite low compared to the early 1990's, when Guatemala was a major producing country for opium poppy. During 2000 opium eradication totaled a single hectare. Marijuana cultivation continues to be a problem in the northern jungle areas along the borders with Belize and Mexico. The DOAN eradicated 32 hectares of marijuana in 2000 compared to 52 hectares in 1999. The lack of resources in general, and air assets in particular, has made eradication a difficult mission for the DOAN.

Sale, Transport, and Financing. The Pan-American Highway is a major conduit of illegal drugs traveling north to Mexico and eventually the U.S. Drugs also are transported to Europe through Guatemalan commercial maritime vessels. Earlier this year, Dutch police made a large seizure of cocaine that was concealed in a banana shipment from Guatemala. The DEA reports that the number of Guatemalan "mules" being caught in U.S. airports with cocaine and heroin in or on their bodies has increased greatly. U.S. law enforcement sources indicate that air transshipment of cocaine decreased, while shipment via boats increased in 2000. The use of commercial containers, both on land and through seaports, continues to offer the best opportunity for smuggling larger quantities of drugs through Guatemala.

Money Laundering. While recent statistics are unavailable, many believe that money laundering is on the rise in Guatemala. In November of 2000, the GOG ratified the Central American Convention for the Prevention of Money Laundering and Related Crimes. While this convention lacks teeth without the proper money laundering legislation, its ratification is an indication of the GOG's recognition of the need to take action. (For additional information see Money Laundering Section)

Asset Seizures. The GOG passed reforms to drug enforcement legislation in November 1998 to allow the use of seized assets by the police, and the DOAN is now using some seized vehicles to support their operational requirements. However, Guatemalan law still does not allow the DOAN to use monies seized in narcotics cases. The use of seized assets is still relatively new, and the procedures for using the assets are complicated, difficult to use and not transparent. The U.S. is currently developing a standard procedure for the DOAN, so that it can more easily and regularly apply for and receive the maximum amount of available seized assets.

Extradition. The extradition treaty between the GOG and the USG dates from 1903; a supplementary extradition treaty adding narcotics offenses to the list of extraditable offenses was adopted in 1940. Their use in recent years has required a significant expenditure of effort and time on the part of both the USG and the GOG. Despite limited success with formal extraditions, the GOG is sometimes able to expel/deport U.S. fugitives on the basis of violations of Guatemalan immigration laws.

Mutual Legal Assistance. The USG does not have a mutual legal assistance treaty with Guatemala.

Law Enforcement and Transit Cooperation. Guatemalan law enforcement representatives work enthusiastically with U.S. personnel and organizations to curtail the flow of drugs through Guatemala. Several U.S. law enforcement agencies have active collaborative relationships with Guatemalan law enforcement authorities. Guatemala continues to exchange information and maintain links with Joint Intelligence Coordination Centers (JICC) throughout Central America and with the El Paso Intelligence Center (EPIC). The Port Security Program (PSP), a self-financed program that fosters cooperation between the GOG, the USG and private shipping companies operating in Guatemala, continues to contribute to the counternarcotics effort. The program is funded by a fee levied on shipping companies and used to finance the program's day-to-day operations that include providing monetary and technical assistance to the DOAN agents who operate in the ports. The USG provides technical, logistical, and training assistance. Guatemala participated in two Mayan Jaguar combined maritime counterdrug operations with the U.S. Coast Guard.

Demand Reduction. The GOG is firmly opposed to illicit drugs and continues to support drug education and rehabilitation programs. In 2000, SECCATID implemented a variety of projects as part of their comprehensive demand reduction strategy. Through the National Program of Preventive Education, SECCATID trained 350 more instructors this year throughout the country using the "train the trainer" concept. SECCATID has also hosted over 700 parents in monthly drug education seminars throughout the country.

This year SECCATID published a booklet entitled "Manual for Teachers About Drug Prevention." The manual is now being distributed to schools throughout the country for use as part of the normal curriculum. SECCATID, with the help of local community involvement, also implemented a national awareness billboard campaign against drug consumption. This last year also saw the creation of an Ambulatory Drug Rehabilitation Program that has produced some very positive results. The program provides the only outpatient-based drug rehabilitation program in Guatemala. The program insists on addicts recognizing that they have a problem and also promotes family involvement in the rehabilitation program when possible.

Law Enforcement Efforts. The GOG continued efforts to modernize the PNC despite budget cuts. This year, they centered on investigative development, basic investigative training, crime scene management, updating the DOAN intelligence functions, creating the vetting unit, and fully establishing a counternarcotics command and control center. However, frequent turnover in the command structure created management problems that undermined the PNC's performance.

Corruption. Guatemala has signed, but not ratified, the Inter- American Convention Against Corruption. Corruption and intimidation in Guatemalan justice and law enforcement institutions continue to be serious concerns. Police are regularly accused of corruption, prosecutors mishandle cases, and some judges appear to be colluding with drug traffickers. For example, five narcotraffickers were released after having their case moved through a series of judges, with the last one reducing the charges and subsequently releasing the suspects without a proper legal basis. Even the Congress is not exempt from corruption, as 23 ruling party congressmen have been accused this year of altering financial details of a tax law after it had been approved by the general session. "Guategate," as the case is called, has occupied a tremendous amount of time of the anticorruption unit and the judiciary. GOG efforts to fight corruption have been generally ineffective and have contributed to disillusionment with the government's commitment to solving this problem.

The Public Ministry (MP), with USG assistance, opened the new Anti-Corruption Prosecutor's office in April 2000. The unit has since initiated almost a thousand cases against government officials. It remains to be seen whether these cases will result in convictions.

The USG funded the first ever Anti-Corruption Seminar for high-level GOG and regional leaders this year. The attendance was a veritable "Who's Who" of Guatemala. While immediate results are not expected, the fact that almost all high-level government officials attended and signed a resolution to fight corruption raises hopes that anticorruption efforts are going to intensify in the coming years.

Agreements and Treaties. Guatemala is a party to the 1961 UN Single Convention and its 1972 Protocol; the 1971 UN Convention on Psychotropic Substances; the 1988 UN Drug Convention; the Central American Commission for the Eradication of Production, Traffic, Consumption and Illicit Use of Psychotropic Drugs and Substances; and the Central American Treaty on Joint Legal Assistance for Penal Issues. Guatemala has also signed bilateral counternarcotics agreements, including information exchanges, with Mexico (1989), Venezuela (1991), Argentina (1991), Colombia (1992), Ecuador (1992), Peru (1994), and Spain (1999). While most GOG law enforcement efforts have been fully consistent with the goals and objectives of the 1988 UN Drug Convention, some aspects of the Convention, such as the provisions on extradition and money laundering, have not been codified into law. Intermittent negotiations on a bilateral Maritime Counterdrug Agreement occurred between 1997 and 1999; however, there has been no progress since then. In December 2000, Guatemala signed the UN Convention Against Organized Crime.

IV. U.S. Policy Initiatives and Programs

Policy Initiatives. A U.S. regional project to begin tracking commercial freight is just coming online and is expected to help in countering this threat. U.S. efforts will continue to focus on developing an effective interdiction program and a more professional DOAN with effective intelligence capabilities. They also will focus on continued training and support for the narcotics prosecutors and members of the judicial system. The U.S. will continue to press the GOG to pass specific legislation to combat narcotrafficking and money laundering before they threaten the stability of Guatemala's fragile financial sector.

The Road Ahead. Now that the Portillo Administration has completed a full year in office, the problem of excessive turnover of counternarcotics personnel should be resolved. Since most of the new administration's legislative energies were devoted to domestic concerns in the past year, the GOG should find it easier to pursue some of the more complicated legislative and bilateral initiatives that are needed to successfully engage the narcotraffickers. The GOG antinarcotics forces will continue to develop qualitatively and quantitatively, with more effective investigative and law enforcement units to control transshipment, expanded case management and tracking, increased data collection and analysis capability, and greater regional cooperation.

The GOG plans to increase public education and demand reduction efforts, bringing in more private and public funding and expanding regional cooperation. Cocaine abuse, primarily crack, is expected to continue to grow as traffickers trade a percentage of cocaine shipments for transportation and security services. Domestic cocaine consumption will increase drug-related domestic crime, adding to the burden on a police force that is already struggling to cope with the current wave of violent crime that is blanketing the country.

Guatemala Statistics
(1992-2000)

 

2000

1999

1998

1997

1996

1995

1994

1993

1992

Opium

                 

Potential Harvest (ha)

0

0

10

7

0

39

50

438

730

Eradication (ha)

1

1

5

3

12

86

150

426

470

Cultivation (ha)

1

1

15

10

12

125

200

864

1,200

Potential Yield (mt)

0.00

0.00

0.20

0.10

0.00

0.40

0.50

4

7.0

Cannabis

                 

Potential Harvest (ha)

unk

0

82

100

41

50

100

unk

80

Eradication (ha)

32

52

58

50

213

250

100

200

40

Cultivation (ha)

32

52

140

150

254

300

200

unk

120

Potential Yield (mt)

1

0

10

12

5

6

12

 

20

Seizures

                 

Cocaine (mt)

1.4

10.1

9.2

4.3

4.0

1.0

2.0

7.6

9.5

Cannabis (mt)

0.03

0.65

0.42

0.34

16.40

0.50

1.76

2.1

0.7

Heroin (kg)

9.30

52.00

3.65

16.20

7.80

0.00

0.00

0.00

0.001

Opium (kg)

1.0

0.0

0.0

0.0

0.0

0.0

0.0

2.0

 

Arrests

842

472

928

188

189

       

Honduras

I. Summary

Honduras remains a transit country for drugs, primarily cocaine, moving toward Mexico and the U.S. from South America. Evidence in 2000 did not support a finding that drugs entering the U.S. from Honduras were in an amount sufficient to have a significant effect on the U.S. However, the entire region of Central America, including Honduras, remains of concern to the U.S. Corruption is endemic and continues to undermine Honduran law enforcement and counternarcotics efforts. The Honduran Congress ratified a maritime counternarcotics agreement with the U.S. that will facilitate U.S. support for Honduran interdiction operations. The Honduran Congress also approved a constitutional judicial reform amendment designed to improve the effectiveness of the judiciary. The Government approved a counternarcotics master plan, but funds to implement it are limited. Both the Honduran military and Ministry of Security took a more active role in antidrug operations. The U.S. continues to provide funding, training, and technical support to improve Honduran law enforcement capabilities. Ensuring the detention, prosecution, and incarceration of major offenders, however, remains a challenge. Honduras is a party to the 1988 UN Drug Convention.

II. Status of Country

Honduras produces a limited amount of marijuana but is not a significant drug producing country. Its primary drug problem stems from the trafficking of hard drugs, in particular, cocaine, via air, land, and maritime routes. There are direct air and maritime links to U.S. cities and the Pan American Highway crosses southern Honduras. The Honduran police and Navy have limited maritime assets to counter narcotrafficking. The assassination in November 2000 of a drug smuggler by two Hondurans in the pay of Colombian traffickers, later shot to death by Honduran police, highlights the reality that international drug transporters are active in Honduras. U.S. law enforcement agencies believe money laundering in Honduras is increasing, although the country is not a major money laundering center.

III. Country Actions Against Drugs in 2000

Policy Initiatives. The National Congress ratified an agreement with the U.S. to facilitate maritime counternarcotics cooperation, which is expected to go into effect in early 2001. The Government also approved a counternarcotics master plan. In late 2000, the National Congress approved a judicial reform constitutional amendment aimed at reducing the arbitrary administration of justice. These reforms have the potential to decrease opportunities for criminals to manipulate the judicial system but will require substantial political will to implement.

Accomplishments. As of December 1, 2000, the Honduran antidrug police, the (DLCN) and the National Preventive Police (PNP) had seized 1.139 metric tons of cocaine, 1,272 rocks of crack, and 2,550 pounds of marijuana. The DLCN and PNP also had made 892 narcotics-related arrests. The Public and Security Ministries and the Honduran Navy signed an agreement to establish a small maritime facility in Gracias a Dios Department. The Honduran police have begun to interdict cocaine transshipments through frontier posts, drawing on increased U.S. Government-provided counternarcotics training.

Law Enforcement Efforts. Counternarcotics operations remain a high priority for the Government of Honduras (GOH), but a lack or resources and training combine with ineffective institutions to hamper these efforts. There is mounting evidence of the penetration of law enforcement agencies by narcotraffickers and other criminals. For example, a DLCN unit arrested a police official assigned to Gracias a Dios Department found carrying cocaine from that region to La Ceiba. In another instance, the DLCN intercepted a large cocaine shipment in transit from San Pedro Sula to Guatemala by truck. Although they arrested the driver, he eventually gained his release through bribery.

Corruption. Corruption is arguably the single most serious impediment to more effective counternarcotics efforts and remains a major problem in all aspects of national life. The Minister of Security has proposed a series of measures to counter the influence of corruption on law enforcement and judicial authorities, but the National Congress has yet to enact any of them. The Government dismissed a number of officials suspected of involvement in corrupt practices, including the deputy national police commissioner, but has yet to conduct a wide-ranging investigation into criminal penetration of law enforcement and judicial units. Nationally elected officials enjoy legal immunity for all acts while in office, creating a perverse incentive for people involved in illicit activity to run for office and complicating enforcement efforts against suspected illegal narcotics activity.

Agreements and Treaties. The Honduran Government is an active member of the Inter-American Drug Abuse Control Commission (CICAD). Honduras also hosts the Regional Center for Legal Development and Judicial Cooperation in Central America, which is headed by a Nicaraguan. Honduras has counternarcotics agreements with the U.S., Belize, Colombia, Jamaica, Mexico, Venezuela, and Spain. The U.S. and Honduras continue to negotiate a stolen vehicles treaty. The U.S. and Honduras concluded a maritime counternarcotics agreement that is to enter into force in early 2001. The agreement will allow U.S. vessels to operate in Honduran waters in support of Honduran law enforcement efforts. In addition, the agreement provides for information exchange and the coordination of joint counternarcotics activities. A 1909 extradition treaty between the U.S. and Honduras is in force, however, the 1982 Honduran Constitution prohibits extradition of Honduran nationals. In December 2000, Honduras signed the UN Convention Against Transnational Organized Crime.

Cultivation/Production. Marijuana remains the only illegal drug known to be cultivated in Honduras. The GOH lacks the technical ability to determine the size of the crop and conducts eradication operations on an intermittent basis. During 2000, the GOH eradicated 589,027 marijuana plants.

Drug Flow/Transit. The vast majority of drugs entering Honduras are destined for the U.S., although evidence in 2000 did not support a finding that the quantity of drugs that entered the U.S. from Honduras was sufficient to have a significant effect on the U.S. There are increasing reports that traffickers are using drugs, rather than currency, to pay local contractors for services. The U.S. law enforcement community believes the volume of drugs transiting Honduras increased in 2000, although it is difficult to quantify the amounts involved since most shipments go undetected. Drug smuggling through Honduran ports on the Caribbean has encouraged the port authority to work with private companies and U.S. officials to develop a port security program. Commercial and private vehicles continue to be used to smuggle cocaine on overland routes. Illegal landings in Gracias a Dios Department also are used to deliver cocaine for transshipment via small boat to La Ceiba for embarkation on commercial vessels, or via truck to Guatemala.

Asset Seizure and Forfeiture. The National Congress enacted an asset seizure law in 1993 that subsequent Honduran Supreme Court rulings substantially weakened. The draft legislation mentioned above, however, strengthens the asset seizure provisions of Honduran law.

Precursor Chemical Control. The GOH continues to try to limit the illicit introduction of precursor chemicals into the country. However, comprehensive regulations to control the sale of chemicals necessary for the processing of illegal narcotics have never been developed. There is no evidence to suggest the presence of large-scale narcotics labs in Honduras.

Domestic Programs/Demand Reduction. Alcohol is by far the most abused drug in Honduras, followed by—to a much lesser degree—cocaine, marijuana, and inhalants. Crack cocaine use is increasing, however, particularly along the north coast, in the Bay Islands and in urban centers. Reports of so-called designer drugs such as "ecstasy" have appeared in the press.

Honduran government efforts to fight drug abuse lack structure and sufficient funding to have much of an impact, and demand reduction has not traditionally been a part of Honduran counternarcotics efforts. Until recently, drug abuse was rarely addressed by politicians or raised as an issue in the public domain. More attention has been given to the issue in recent years, but drug abuse is still viewed as merely one among many public health and social problems linked to unemployment, poverty, and the growing number of youth gangs or "maras."

The Honduran Government's demand reduction entity "IHADFA"—the Institute for the Prevention of Alcoholism and Drug Addiction—conducts prevention programs throughout the country. IHADFA also chairs the umbrella groups "CIHSA"—the inter-institutional coordinating body for addiction, through which it oversees programs operated by the ministries of public health and education, as well as by non-governmental organizations. However the majority of CIHSA members are social development organizations, many of them religion-based, for which prevention is only one of many objectives.

IV. U.S. Policy Initiatives and Programs

U.S. Policy Initiatives. U.S. counternarcotics initiatives focused on gaining ratification by the Honduran Congress of the maritime counternarcotics accord and implementation of bilateral counternarcotics and anticorruption projects. The U.S. has signed a series of bilateral agreements with key Honduran Government agencies to provide anticorruption assistance by funding the acquisition of computers and conduct training. The U.S. Customs Service sponsored a series of anticorruption conferences. The U.S. and Honduras continued to negotiate the language of a proposed stolen vehicles agreement.

Bilateral Cooperation. The canine program moved forward, with four dogs delivered and four handlers trained in 2000. The U.S. Customs Service is to train five more handlers and deliver five dogs in 2001. Three vehicles to transport canine units were delivered to the Public Ministry counterdrug unit in December. Plans for constructing a counternarcotics and customs checkpoint on the Pan American Highway were also prepared, with completion anticipated in August 2001. The U.S. provided two refurbished 36-foot patrol boats for counternarcotics purposes. The U.S. will provide financial support to the DLCN, Ministry of Security, and Honduran Navy to establish a small maritime facility in Gracias a Dios Department, a major narcotrafficking center. Representatives from the DLCN, the police counterdrug unit, and the Public Ministry's organized crime unit attended a U.S.-funded Advanced Narcotics Investigators Course in Guatemala.

Honduran demand reduction programs are benefiting from a three-fold expansion in U.S. funding compared to FY 1999. The U.S. Embassy cooperates with IHADFA by funding educational and community-based programs for children at risk and "maras" (youth gangs). These programs include workshops and training seminars for parents, teachers, and community leaders, and the development of alternative activities for at-risk populations. Honduran maritime forces joined the U.S. Coast Guard in several maritime counterdrug operations such as OP Lifesaver and OP Seguridad.

The Road Ahead. The Honduran Government remains committed to the battle against the use or transport of illegal drugs. The Security Ministry has taken a keen interest in bilateral counternarcotics cooperation following the appointment of a new Minister. The Honduran military has begun to assume a greater role in counternarcotics affairs, following the 1999 constitutional amendment that established a military counternarcotics mission. While the Government has approved a counternarcotics master plan, funding is limited and U.S. assistance to accomplish key goals will remain crucial. Corruption and drug-related violence continue to pose a major challenge to effective law enforcement.

Mexico

I. Summary

Mexico faces a broad array of drug-related problems including the production and transshipment of illicit drugs, money laundering, illicit firearms trafficking, and growing consumption. The Government of Mexico (GOM) remained committed its longstanding policy of combating drug trafficking and related crimes, and to close cooperation with the U.S. and other countries in the Hemisphere. In its struggle against drugs, Mexico still faces daunting challenges. The drug trafficking organizations that control the production and shipment of drugs, along with related money laundering and criminal activities, remain powerful. These groups are well organized and adept at corrupting or intimidating public officials. Corruption of the law enforcement sector by drug trafficking organizations remains a serious institutional problem. These organizations likewise pose a serious threat to the United States, controlling drug distribution networks throughout much of the country.

Mexico's counterdrug program achieved a number of important successes in 2000. Mexican authorities arrested two key members of the Tijuana based Arellano Felix Organization (AFO). Mexico's aggressive eradication program, coupled with drought in the principal drug cultivation areas, resulted in record low levels of opium poppy production. Bilateral counterdrug cooperation was characterized by improved information sharing and the establishment of formal mechanisms to achieve shared goals. The two governments collaborated on a bilateral evaluation of illicit crop cultivation. Bilateral maritime cooperation advanced with the creation of a technical working group. In an important decision announced January 2001, the Mexican Supreme Court affirmed the GOM's authority to extradite Mexican nationals. This, along with the Mexican Senate's December 2000 ratification of the temporary surrender protocol to the bilateral extradition treaty, should improve cooperation in bringing drug traffickers and other criminals to justice.

In July 2000, Vicente Fox Quesada was elected president of Mexico on a platform of restoring public security and putting an end to corruption. The Fox Administration has pledged its commitment to combating drug traffickers and ending impunity. It has proposed several structural changes to Mexico's law enforcement institutions, including the creation of a new Public Security Ministry and professionalization of the national police forces. These commitments offer unprecedented opportunities for greater cooperation and mutual assistance with the U.S. However, corruption and the ability to implement proposed reforms present significant hurdles for success of the GOM's counterdrug strategy.

II. Status of Country

Mexico is the principal transit route for U.S.-bound cocaine from South America. DEA estimates that 55 percent of the cocaine sold in the U.S. transits Mexico. Cocaine and other drugs are smuggled via every conceivable commercial and non-commercial conveyance: air or maritime containerized cargo; fishing vessels; flights to clandestine landing points; and airdrops to go-fast boats off Mexican coasts. Human "mules," including undocumented migrants and children who backpack or strap the drugs to their bodies, also transport smaller quantities of the contraband.

Although only one suspect flight originating outside Mexico was detected in 2000, hundreds of internal flights moving drugs, primarily marijuana, from South/Central Mexico to the border overwhelmed limited law enforcement air and land assets. During 2000, the eastern Pacific coast of Mexico continued to be the favored route for maritime trafficking because of the vast area and a lack of natural choke points. In addition, there was a resumption of non-commercial vessel movement to Mexico's Yucatan Peninsula through the Western Caribbean. Maritime trafficking can involve single or multiple vessels, go-fast boats, fishing vessels and commercial carriers. Traffickers continued to use air shipments, although they appeared to be less frequent than maritime deliveries, as well as the overland route via Mexico's southern border from Guatemala and Belize.

Mexico-based transnational criminal organizations have become the largest distributors in the U.S. of methamphetamine and its precursor chemicals. The rate of increase in methamphetamine seizures—638 kilograms for 2000 versus 358 kilograms for 1999 and 96 kilograms for 1998—suggests a growing involvement by Mexican traffickers in this trade that targets the U.S. Seizures of Mexico-bound ephedrine, the primary ingredient used to manufacture methamphetamine and similar stimulants, have focused attention on the magnitude of ephedrine acquisition by Mexican organized crime groups. Mexico is also a transit point for potassium permanganate, used in the purification process for cocaine.

Mexico's eradication program is one of the oldest and largest in the world. The military and Attorney General's Office (PGR) continued their successful manual and aerial eradication programs, posting figures comparable to 1999's record gains. Most drug crop cultivation occurs in small fields located in remote areas to evade detection and eradication. Since lands used for illicit cultivation are subject to seizure, many growers use public or communal lands to avoid tracing ownership.

Although Mexico produces only about two percent of the world's opium, nearly its entire harvested illicit crop is converted into heroin and shipped to the U.S. USG estimates of opium poppy production in Mexico during the past decade show potential yields of 4 to 6 metric tons of heroin annually. GOM eradication efforts, coupled with a severe drought, caused cultivation to plummet almost 50 percent to a record low—to 1,900 hectares -and potential heroin production to fall from over 4 metric tons in 1999 to only 2.5 metric tons in 2000.

During the past three years, marijuana cultivation has yielded an estimated 6,700-8,600 metric tons annually. In 2000, net marijuana cultivation showed no significant change, increasing by only 200 hectares to 3,900 over 1999. As a result, potential marijuana production increased from 6,700 metric tons in 1999 to 7,000 metric tons last year. In crop field surveys during the past three years, a more robust plant has been observed throughout Mexico. The plant grows to a height of two meters and has more flowering area, the most potent part of the plant. Mexican agronomists assess that the plant has higher levels of THC and, because of resin-coated foliage, is more resistant to herbicides.

Drug related violence in Mexico is on the increase. In the past, drug-related violence was mostly confined to rivalries between trafficking organizations. These organizations, however, have demonstrated blatant disregard for human life, as executions of law enforcement personnel, government officials, and innocent bystanders have increased.

In recent years, international money launderers have turned increasingly to Mexico for initial placement of drug proceeds into the global financial system. Measures enacted by Mexico in 1996 provide the legal framework for more effective control of money laundering. Recent legislative modifications and regulations that lower the CMIR threshold (inbound or outbound declarations of large amounts of currency or monetary instruments) and impose requirements for suspicious transaction reports, currency transaction reports, "know your customer", and record keeping requirements on non-bank financial institutions (currency exchange houses, credit institutions, stock market, insurance companies, and bail bond companies) should improve the GOM's ability to prosecute money laundering cases.

In January 2000, the GOM signed a Memorandum of Understanding with the U.S. to facilitate tracking of the movement of large sums of money from the U.S. to Mexico. In June 2000, Mexico became a member of the Financial Action Task Force (FATF), a global body dedicated to fighting money laundering. In November 2000, the Mexican Secretariat of Finance and Public Credit proposed to regulate non-bank financial institutions such as foreign exchange houses (casas de cambio). In January 2001, Mexico enacted domestic legislation to strengthen reporting of large value domestic currency transactions. However, enforcement continues to be weak and convictions scarce. Additional efforts need to be directed towards developing cooperative relationships among law enforcement, financial regulators, and the financial sector to reduce financial system vulnerabilities.

In recent years, Mexican law enforcement agencies intensified counterdrug enforcement while increasing information exchange with the U.S. and other international partners. Efforts to arrest members of the Baja California-based Arellano Felix Organization (AFO) since March 2000 have been relatively successful. The GOM still lacks the broad institutional capability to fully implement its antidrug legislation and national drug strategy. Chronic problems of corruption, weak police and criminal justice institutions, budget constraints, and severe poverty in rural areas where drug crops are cultivated hamper Mexico's ability to combat drug trafficking.

III. Country Actions Against Drugs in 2000

Policy Initiatives. Mexico's national antidrug strategy encompasses the full range of actions called for in the 1988 UN Drug Convention and highlights the importance of international cooperation, particularly with neighboring states.

In July, Vicente Fox Quesada was elected president on a platform that emphasized improved efforts against organized crime and elimination of official corruption. The Fox administration, which took office December 1, 2000, has outlined an ambitious plan for strengthening and restructuring federal law enforcement agencies, in particular strengthening the prosecutorial role of the PGR and transferring key police functions from the Secretariat of Government to a new Secretariat for Public Security and Justice. The administration has expressed its intention to professionalize and strengthen the role of the Federal Judicial Police, to be renamed the Federal Investigation Agency. A cabinet-rank Comptroller General will focus on white-collar crime by public officials and chair an inter-agency, cabinet-level panel on anticorruption. In late December, Fox announced his intention to deploy at least 2,000 Federal Preventive Police (PFP) to Tijuana to "put an end to the power exercised by the Arellano Felix Organization."

Appeal provisions provided in the 1999 Asset Seizure and Sharing Law continue to hamper asset forfeiture by allowing drug traffickers to file prolonged legal appeals against GOM efforts to seize their properties.

Institutional Development. Institutional weaknesses within national law enforcement organizations remain a serious obstacle to the efficiency and reliability of Mexican police forces. In 2000, a renewed focus by the GOM on the professionalization of its law enforcement agencies was accompanied by increased collaboration with the U.S. on training. The PGR, PFP, and the National Public Safety System (which coordinates training for state police) were more proactive in coordinating a wide range of public security and counterdrug training opportunities, including courses on ethics, human rights, "train-the-trainer" and basic investigation. The GOM gave special emphasis to counterdrug training. Approximately 4,000 students participated in at least 122 U.S. sponsored courses offered through Mexican law enforcement training institutions.

A new federal law enforcement entity for crime prevention, the PFP, operational since mid-1999, is charged with prevention of federal crimes such as terrorism, smuggling, kidnapping, arms trafficking, drug trafficking, and protection of federal installations such as airports, ports, highways, and borders. Intelligence gathering and analysis to support this mandate is a major operational tool of the new force, whose commanders and agents are among the highest paid police officials in Mexico.

Major improvements to the infrastructure of other key government agencies will support Mexican efforts to combat drug trafficking and related crimes. The National Public Safety System invested approximately $1 billion U.S. dollars in both state and federal law enforcement agencies in 2000. The GOM invested in several new tools for law enforcement, including: a nationwide fingerprint database which consolidated over 500,000 paper records; and the purchase of 24 Bell helicopters for drug crop eradication by the Mexican Attorney General's office. In the area of money laundering, the Secretariat of the Treasury completed a major project to allow automated filing of Mexican financial sector reports from banks. This effort will greatly speed the receipt and analysis of data used to identify and track money-laundering operations.

The Office of the Special Prosecutor for Drug Crimes (FEADS) received a major upgrade to its communications system and computer network. The USG donated four ion scanners to assist FEADS in detecting minute traces of drug residue. The scanners have already been used to establish probable cause on one maritime smuggling event.

The Mexican Secretariat of National Defense (SDN) spends approximately 16 percent of its budget on eradication and interdiction. According to media reports, the SDN will receive a budget increase of 12 percent in 2001 to further support counterdrug efforts.

Law Enforcement Efforts. Mexico's antidrug enforcement efforts included organized crime investigations, the arrest of several important traffickers, sustained marijuana and poppy eradication, money laundering investigations (see money laundering section of this report), chemical diversion control (see chemical control section of this report), and increased bilateral cooperation in air, land and maritime drug interdiction.

Arrests. The GOM arrested a number of important traffickers in 2000, most significantly two high level associates of the Arellano Felix Organization. On May 3, 2000, the Mexican military arrested Ismael "El Mayel" Higuera Guerrero, chief operations officer for the AFO, in Tijuana. On March 11, 2000, Mexican authorities arrested Jesus "Chuy" Labra Aviles, the AFO financial manager. Other key AFO collaborators captured in 2000 included Enrique Harari Garduno, a former Federal Highway Police director who provided protection and insider information to the AFO; Carlos Ariel Charry Guzman, a Colombian affiliated with the Revolutionary Armed Forces of Colombia (FARC), who served as a go-between for Colombia-Mexico drug shipments for the AFO; and Ismael Higuera Avila, son of Ismael Higuera, who was arrested in Ensenada in August and was formally arraigned on drug trafficking charges a month later.

Notable also was the arrest of Agustin Vazquez Mendoza, captured in the state of Puebla in July 2000, after a six-year manhunt by U.S. and Mexican law enforcement agents. Vasquez Mendoza allegedly was responsible for the 1994 killing of a DEA agent in Phoenix, Arizona, and his arrest would not have occurred without significant sustained support by Mexican federal and state police agents. His extradition to the U.S. is pending appeal.

In addition, a joint U.S.-Mexican investigation—Operation Tar Pit—resulted in the arrests of significant heroin traffickers Isaias and Juan Hernandez Ibarra. Extradition requests are pending. In November 2000, Hugo Baldomero Medina Garza, a key figure of the Gulf Cartel, was arrested in Tampico, Tamaulipas on charges of drug trafficking, illegal arms possession, and money laundering. Mexican authorities are actively pursuing his prosecution. In March of 2000, GOM vetted units arrested significant Mexican drug trafficker Olegario Meraz Gutierrez, cousin of major trafficker Jose Albino Quintero Meraz.

Although none of the leading Mexican drug traffickers was arrested or convicted in 2000, these actions represent significant accomplishments for Mexico's counterdrug agencies, both in arresting and initiating prosecution of high-level traffickers. Each of these arrests involved successful operational planning and execution, and a new level of interagency cooperation.

Seizures. Mexican law enforcement and military entities reported the following (provisional) seizure and destruction statistics:

  • 23.2 metric tons of cocaine (31 percent decrease over last year)
  • 2005.1 metric tons of marijuana (37 percent increase)
  • 302.0 kilograms of heroin (17 percent increase)
  • 409.3 kilograms of opium gum (49 percent decrease)
  • 638.2 kilograms of methamphetamine (78 percent increase)
  • 23 clandestine laboratories (64 percent increase)

Asset Seizure & Forfeiture. In February 2000, GOM investigations identified and dismantled a complex money laundering operation connected to the Amezcua Contreras organization. Through the investigation, the PGR was able to identify and seize 70 properties, including bank accounts, 20 companies and six aircraft.

In May 2000, the GOM seized 20 properties associated with Ismael Higuera Guerrero. In June 2000, raids conducted on multiple properties resulted in the seizure of five ranches presumably owned by Ismael Zambada Garcia in Sinaloa. Zambada Garcia is a major trafficker previously associated with the Juarez cartel. In July 2000, Renato Tostado Felix, an alleged gunman for Juan Jose Esparragoza Moreno, was arrested and four properties and bank accounts were seized. Esparragoza, known as "El Azul," is a major trafficker and former member of the Juarez cartel.

Mexican authorities seized approximately 8 million U.S. dollars in AFO property following the arrests of Jesus "Chuy" Labra and Ismael Higuera Guerrero.

As a result of combined operations, the PGR and U.S. Customs Service seized over 20 aircraft involved in drug trafficking in northern Mexico.

Illicit Cultivation and Production. Mexico's aggressive eradication campaign, coupled with drought conditions in 1999 and 2000, has reduced net cultivation of opium poppy to record lows. Illicit cultivation is characterized by small fields in remote locations on public lands and is widely dispersed across a large potential growing area.

In 2000, the GOM eradicated 15,621 hectares of opium poppy (up from 15,470 in 1999) and 31,019 hectares of cannabis (down from 33,583 in 1999). The GOM does not produce estimates of illegal drug crop cultivation; however, U.S. experts estimate that Mexico's net opium drug crop production in 2000 was 24 metric tons of opium gum compared to 43 metric tons in 1999 and 60 metric tons in 1998. Net marijuana production was 7,000 metric tons of cannabis, compared with 6,700 metric tons in 1999 and 8,300 metric tons in 1998. Marijuana production declined throughout the 1990's while opium poppy production, which had fluctuated roughly between 4,000 and 5,000 hectares of net cultivation, dropped to its lowest level ever.

Cooperation between GOM and U.S. entities involved in eradication and assessment of drug crop production has been excellent. The two governments held frequent exchanges of information regarding new types of drug crops resistant to herbicides and eradication operations and in 2000 initiated a bilateral study to refine the estimated opium yield of Mexican poppy plants.

Extradition. In 2000, the GOM extradited 12 fugitives to the United States as compared to 14 in 1999. Of the 12, six were sought on drug-related charges (three U.S. citizens, two Argentines and one Mexican national). No major drug trafficker was extradited in 2000.

In January 2001, the Mexican Supreme Court ruled that the GOM, in its discretion, could extradite Mexican nationals pursuant to the existing U.S.-Mexico Extradition Treaty. This decision, which impacts a large number of outstanding cases, resolves a perceived contradiction between the Mexican Penal Code, Mexican extradition law, and the extradition treaty over whether Mexican citizens must be tried in Mexico for crimes committed abroad or may, "in exceptional cases," be extradited for trial in the country whose laws have been violated by their criminal activities. Despite this perceived contradiction, the GOM extradited seven Mexican nationals and one dual U.S.-Mexican national to the United States in cases it deemed exceptional between 1996 and 2000. However, during the same time period, Mexican intermediate appellate courts entered nonappealable release orders in favor of two significant drug-trafficking fugitives, Oscar Malherbe and Jaime Gonzalez-Castro, based on findings that the jurisdiction of Mexican courts to prosecute Mexican nationals for offenses committed abroad preempted any discretion of the Mexican executive branch to extradite them.

Notwithstanding the favorable Supreme Court decision on the nationality issue, adverse lower court decisions on other issues continue to impede the extradition process. In fact, in 2000, four fugitives (three wanted for narcotics trafficking and one for money laundering) were released after Mexican courts ruled against U.S. extradition requests. Most significant is the issue of life imprisonment, which was the basis for the 2000 release of narcotics trafficker Jaime Ladino-Avila after a court ruled that his potential sentence of life imprisonment in the United State violated the Mexican Constitution's prohibition against cruel or unusual punishment While a battery of Foreign Ministry and judicial opinions throughout 2000 reached the opposite conclusion of the Ladino court, underscoring that the Mexican Constitution contemplates imprisonment and that potential life imprisonment abroad should not frustrate the extradition process, the issue remains to be resolved by the Mexican Supreme Court. An unfavorable decision by the Supreme Court could extend to all extradition cases where a fugitive, regardless of nationality, faces a potential life sentence in the United States.

As of December 31, 2000, there were 51 persons in Mexican custody pending extradition to the United States. This group includes drug related defendants Agustin Vasquez Mendoza, wanted in connection with the 1994 murder of DEA agent Richard Fass; Ismael Higuera Guerrero, a top lieutenant of the AFO; and the brothers Isaias and Juan Hernandez Ibarra, major heroin traffickers; and Jesus Amezcua Contreras, a noted methamphetamine trafficker. Unfortunately, the extradition case against Jesus Amezcua's brother, Luis Amezcua, was dismissed in January 2001 by a Mexican court due to lack of active pursuit by the GOM, but he remains in custody on Mexican charges.

Demand Reduction. Mexico faces an increased drug abuse threat related to narcotrafficking. A GOM research study shows that Mexican cocaine consumption has tripled in five years. An estimated 2.5 million Mexicans used illegal drugs in 1998. The third annual U.S.-Mexico Binational Demand Reduction Conference was held in April 2000 in Phoenix, AZ. Experts in treatment and addictions from both nations have established an ongoing dialogue on all facets of drug consumption and treatment. The Mexican government has given special attention to the northern border where the incidence of drug abuse is as much as three times the national average. Demand reduction projects in the border cities of Tijuana and Ciudad Juarez have sought alliances with similar efforts in adjacent U.S. cities.

In June 2000, the GOM named a "drug czar for demand reduction," who brought new attention and focus to federal efforts to reduce drug use. The czar also assumed the helm of the National Council Against Addictions (CONADIC), which was elevated to the Under-Secretary level within the Secretary of Health. CONADIC has since been reorganized and has greatly decentralized the decision making process to state and local governmental and NGO entities. A national media campaign against illegal drug use, alcohol abuse, and tobacco consumption was launched, and an advisory board and trust fund were established to support demand reduction projects.

Corruption. Pervasive corruption in Mexican government institutions remains the greatest challenge facing the GOM in its efforts to fight drug trafficking and organized crime. Long term efforts by the GOM to address the climate of corruption have been stymied by administrative shortcomings in its law enforcement agencies such as a lack of police operational funds, lack of equipment and training, low salaries, and limited career trajectories. Drug money further corrodes an already weak culture of law enforcement. Despite aggressive efforts during the past two years to establish a vetting process for federal police agents, the GOM made little progress against drug related corruption in 2000.

A joint U.S.-Mexico effort to create within the PGR specially vetted counterdrug units insulated from corruption has not lived up to its potential. However, they continue to provide the best option available for eliminating the existence and toleration of corruption within the law enforcement sector.

Notable instances that appear to be related to law enforcement corruption which occurred in 2000, include:

  • In March, the Chief Administrative Officer of the PGR, Juan Manuel Izabal Villicana, committed suicide shortly after $700,000 USD was discovered in his safety deposit box and additional money was found in other safety deposit boxes. One of Izabal's deputies, Jorge Francisco Miranda Noricumbo, director of criminal assets seized by the PGR, was briefly detained and is now free on bail. While the investigation is underway, the incident further undermined public confidence in government institutions.
  • In April 2000, two senior PGR prosecutors and one military officer were murdered. The loss of these officials who were aggressively investigating the AFO was a major blow to Mexican counterdrug efforts. Four federal police agents believed to be working for the AFO were arrested in connection with the murders, and the chief suspect in the case, FEADS Commander Cesar Jimenez, is a fugitive.
  • On August 31, two senior military officers, GEN Mario Acosta Chaparro and GEN Francisco Humberto Quiros Hermosillo were arrested and charged with links to the Amado Carillo Fuentes trafficking organization.

The GOM has established several programs to deal with corruption. The National Public Safety System has established a national police registry to prevent police officials dismissed for corruption from being hired by another law enforcement entity. Additionally, the PGR's employee suitability unit, the Confidence Control Center, conducts background checks and polygraphs on all federal prosecutors, police agents, forensic experts, and pilots assigned to counterdrug duties. Employees who are removed through due process after failing the screening, or who are found to be corrupt or incompetent, have no right to reinstatement, although under certain circumstances they may be compensated for their dismissal.

President Fox has appointed Francisco Barrio Terrazas, the former governor of Chihuahua, as an anticorruption czar, with broad authority to establish anticorruption programs in federal agencies. As Secretary of the Controller and Agency for Administrative Development (SECODAM), Barrio also has oversight over Inspector General-type audits of federal agencies. SECODAM focuses primarily on white-collar corruption, management training and internal controls, and can levy administrative sanctions against corrupt officials.

Agreements and Treaties. Mexico is a party to the 1988 UN Drug Convention, the 1961 UN Single Convention on Drugs as amended by the 1972 Protocol, and the 1971 UN Convention on Psychotropic Substances. It also subscribes to regional antidrug commitments, including the 1996 Anti-Drug Strategy in the Hemisphere and 1990 Declaration of Ixtapa, which commit signatories to take strong action against drug trafficking, including controlling money laundering and preventing chemical diversion. Mexico has bilateral narcotics accords with 32 countries.

The U.S.-Mexico extradition treaty has been in force since 1980. A U.S.-Mexico protocol to the extradition treaty permitting the temporary surrender for trial of fugitives who are serving a sentence in one country but also are wanted on criminal charges in the other was approved by the U.S. Senate in October 1998 and ratified by President Clinton in January 1999. The Mexican Senate approved the protocol in December 2000, and its entry into force is anticipated in early 2001.

Bilateral Cooperation. The U.S. and Mexico cooperate in a range of bilateral counterdrug and law enforcement fora. Senior bilateral entities include the Legal Working Group of the Binational Commission chaired by the Attorneys General of both countries and the High-Level Contact Group on Drug Control (HLCG), headed by the Office of National Drug Control Policy (ONDCP), the U.S. Attorney General, the Mexican Foreign Secretary, and the Mexican Attorney General. The HLCG met in April and in August 2000 to report on progress made by its five working groups (money laundering, demand reduction, arms trafficking, interdiction) to review action plans and goals, and to develop priorities for future cooperation. The Senior Law Enforcement Plenary Group also continues its regular meetings to monitor and guide bilateral actions at the practical and operational level.

Military to Military Cooperation. The Mexican military has been more open than at any time in recent memory and has pressed for expanded cooperation in overland interdiction and increased USG-funded training. A visit to the U.S. by then-Secretary of National Defense Cervantes in January 2000, was followed by visits to Mexico by the Chairman of the Joint Chiefs, J5 and the U.S. Army Chief of Staff.

Money Laundering. Despite the legislative and regulatory advances of the past few years and enhanced domestic and international cooperation, effective implementation of Mexico's anti-money laundering program remains weak. Some financial institutions, such as the "casas de cambio" are exempt from the CTR record keeping and reporting requirements, although this may well change in 2001 as Mexico recognizes and plugs this loophole.

Maritime Interdiction. In April 2000, under the auspices of the HLCG, the U.S. and Mexico established an operationally focused Interdiction Working Group to exchange drug interdiction information that has improved communications and cooperation. In October, the group adopted a protocol to facilitate communications between maritime interdiction elements of both countries. Although multi-ton maritime seizures are down, maritime coordination in "at sea" operations and patrolling has increased significantly.

In November, the U.S. and Mexico held a training exercise in post-seizure analysis for agents and prosecuting attorneys of the Mexican counterdrug agency (FEADS), PFP, Secretariat of Communications and Transportation (SCT), and officials from the U.S. Coast Guard, DEA, FBI, and U.S. Attorney's office. The highlights of the exercise were the use of the ion scanner, crew interview techniques, and detection of false compartments on maritime vessels. A joint session given by Mexican and U.S. prosecutors on protecting the chain of evidence for case prosecution served to educate participants on the needs of judicial officials in both the U.S. and Mexico.

Significant maritime seizures in 2000 included: 5.5 metric tons cocaine, F/V Valeria (January 25); 2.4 metric tons cocaine, go-fast (March 29); 3.5 metric tons cocaine, F/V Top Flight (June 18); 2.4 metric tons cocaine, G/F Rosita (August 21); 1.378 kilograms cocaine, go-fast (October 14); 3.2 metric tons cocaine, go-fast (November 28).

Judicial Exchanges. The U.S.-Mexico Judicial Exchange Program, coordinated by a Binational Committee of Judges and the National Center for State Courts (NCSC), has helped to increase communication and mutual understanding among the judiciaries of the two nations. Over 500 Mexican judges have participated in U.S.-sponsored conferences, seminars, training courses, and graduate programs in the past three years.

In addition, USAID's Rule of Law program has worked closely with GOM entities to develop and strengthen justice sector institutions. Initiatives undertaken in 2000 include: 1) a Judicial Masters program developed by the National University of Mexico (UNAM); 2) a diagnostic of Mexican state courts completed by UNAM and used by President Fox's Transition Team as a source for future policies regarding the Judicial Branch; and 3) a community mediation center in the state of Jalisco established by the Center for Attention to Victims of Crime (CENAVID), a local NGO, to demonstrate how mediation can improve the quality of legal aid services for the poor.

IV. U.S. Policy Initiatives and Programs

As neighboring states facing a common threat, each country's antidrug efforts are directly affected by the policies and efforts of the other. Therefore, both the U.S. and Mexico have sought, through bilateral fora such as the HLCG and Senior Law Enforcement Plenary, and through the Bi-National Drug Strategy, to construct complementary programs and policies. U.S. drug control policy in Mexico is aimed at supporting political commitment and strengthening the institutional capability of the GOM to take effective measures against the production and trafficking of illicit drugs and related crimes. The USG seeks to work collaboratively with Mexico to apprehend and prosecute the leaders of the transnational criminal organizations, to disrupt or dismantle cartel operations, to combat money laundering, arms trafficking, and precursor chemical diversion, and to reduce the demand for drugs.

Cooperative initiatives along our common border are a priority for both nations. In addition, the U.S. seeks to support the GOM's efforts to strengthen institutions, to improve training for its personnel, to modernize the justice sector, and to promote anticorruption reforms. Critical to this success is the identification and prosecution of corrupt law enforcement, military, political, and business leaders who protect traffickers.

The Road Ahead. Mexico and the U.S. will continue to cooperate in a broad spectrum of counterdrug activities, including those targeting drug abuse, trafficking and production. The effectiveness of national and bilateral efforts against drug crimes will depend largely on demonstrable progress in disrupting and dismantling transnational narcotrafficking organizations. This includes apprehending, prosecuting and convicting major drug traffickers, and exposing and prosecuting individuals and businesses involved in providing critical support networks such as money laundering and front companies, security transportation, and warehousing.

Continued measurable progress in reducing the production of illicit drugs and the flow of such drugs through Mexico into the U.S. has long been a shared USG-GOM objective. Continuation of programs to exchange information or experiences in specialized areas will contribute to such progress.

The methamphetamine problem is of serious concern to the U.S. and of increasing concern to Mexico as the consumption rate, particularly in the northern border areas, continues to rise. Much of the methamphetamine sold in the U.S. is believed to originate from the western coastal states of Mexico. Mexico should become more aggressive in chemical control and the coordination of bilateral initiatives should be addressed to deal with this growing problem.

The elimination of official corruption is key to improving counterdrug efforts. The establishment of effective internal affairs units within Mexican law enforcement bodies is critical. The Mexican police must become more aggressive in their efforts to seek out and punish corrupt officials from their own ranks. The establishment of internal audit divisions to deal with administrative corruption that leeches resources from field units will further strengthen the operative elements of the police forces.

As experience in other countries has shown, vetted unit initiatives offer an opportunity to initiate and to advance investigations against major drug traffickers. Bilateral cooperation, confidence building, and information sharing will continue to improve by adoption of a strengthened vetting process. The vetting process that screens officials to serve in specialized units should be incorporated as ongoing and random screening, rather than a one-time exercise.

Security for both Mexican and U.S. law enforcement personnel is of paramount importance. Close collaboration between the U.S. and Mexico, such as existed during the Agustin Vasquez Mendoza case, sends a strong signal to drug traffickers that threats against U.S. or Mexican agents will not be tolerated.

Mexico has had only a handful of successful money laundering prosecutions and convictions. Recent changes to money laundering regulations will improve the ability of the Mexican government to track money laundering operations from unregulated exchange houses and other financial institutions. Establishment of a mechanism to obtain information necessary for investigations from Mexican banking institutions and closer collaboration between financial investigative units within the Mexican government would facilitate the successful prosecution of money laundering cases.

The USG will continue to offer technical support to Mexico in developing and strengthening its counterdrug institutions. Despite increased GOM support to law enforcement, better equipment, more and better-trained personnel, and improved salaries and benefits are still needed to bring law enforcement units to full operating efficiency.

Increased cooperation on post-seizure and post-arrest analysis will enhance investigations against major trafficking organizations.

The Mexican Supreme Court's decision to validate the extradition of Mexican nationals is a welcome development as it supports the principle that criminals should be tried where the crime was committed. The Mexican "amparo" process, a cumbersome appeals process, continues to hinder the extradition of major drug traffickers to the U.S. and feeds the perception that Mexico is a safe-haven for fugitives from justice.

The two countries have made progress in initiating or implementing important elements of the common strategy for cooperative action against illicit drugs. Shared objectives in 2001 are to:

  • Reduce the demand for illicit drugs in both countries by intensifying antidrug information and educational efforts;
  • Improve our respective capacities to disrupt drug shipments by land, air and sea;
  • Focus law enforcement efforts against criminal organizations and those who facilitate their operations;
  • Strengthen U.S./Mexican law enforcement cooperation and policy coordination, especially through the vetted unit program;
  • Make effective use of extradition procedures and ensure that fugitives are brought to justice expeditiously and with due legal process;
  • Enforce existing laws more effectively to detect and penalize money laundering; enhance bilateral and multilateral exchanges of expertise to combat money laundering;
  • Continue training and technical cooperation programs.

Mexico Statistics
(1992-2000)

 

2000

1999

1998

1997

1996

1995

1994

1993

1992

Opium

                 

Potential Harvest (ha)

1,900

3,600

5,500

4,000

5,100

5,050

5,795

3,960

3,310

USG Estimated Impact1   (ha)

7,600

7,900

9,500

8,000

7,900

8,450

6,620

7,820

6,860

Eradication (ha)

15,300

15,469

17,449

17,732

14,671

15,389

11,036

13,015

11,583

Cultivation (ha)

9,500

11,500

15,000

12,000

13,000

13,500

12,415

11,780

10,170

Potential Yield (mt)

25

43

60

46

54

53

60

49

40

Cannabis

                 

Potential Harvest (ha)

3,900

3,700

4,600

4,800

6,500

6,900

10,550

11,220

16,420

USG Estimated Impact1 (ha)

13,000

19,400

9,500

10,500

12,200

11,750

8,495

9,970

12,100

Eradication (ha)

33,000

33,583

23,928

23,576

22,961

21,573

14,227

16,645

16,872

Cultivation (ha)

16,900

23,100

14,100

15,300

18,700

18,650

19,045

21,190

28,520

Potential Yield (mt)

7,000

6,700

8,300

8,600

11,700

12,400

5,908

6,283

7,795

Seizures

                 

Opium (mt)

0.27

0.80

0.15

0.34

0.22

0.22

0.15

0.13

0.17

Heroin (mt)

0.268

0.258

0.120

0.115

0.363

0.203

0.297

0.062

0.097

Cocaine (mt)

18.3

33.5

22.6

34.9

23.6

22.2

22.1

46.2

38.8

Cannabis (mt)

1,619

1,459

1,062

1,038

1,015

780

528

495

405

Methamphetamine (mt)

0.555

0.358

0.096

0.039

0.172

0.496

0.265

Arrests

                 

Nationals2

 10,771

10,261

10,034

10,572

11,038

9,728

6,860

17,551

27,369

Foreigners

 233

203

255

170

207

173

146

75

208

Total Arrests

 11,004

10,464

10,289

10,742

11,245

9,901

7,006

17,626

27,577

Labs Destroyed

 23  14

7

8

19

19

9

5

4

1 The eradication figures shown are derived from data supplied by Mexican authorities. The effective eradication figure is an estimate of the actual amount of a crop destroyed--factoring in replanting, repeated spraying of one area, and other factors.

2 In 1995, the PGR revised downward the 1994 national detainees figure from 14,968 to 6,860.

Nicaragua

I. Summary

While Nicaragua is not a major drug producing country, it is a transit area for illegal narcotics en route from South America to the U.S. Evidence in 2000 did not support a finding that the illicit narcotics entering the U.S. from Nicaragua were in an amount sufficient to have a significant effect on the U.S., but Nicaragua is a country of concern to the U.S. Drug consumption within Nicaragua is on the rise, particularly along the impoverished Atlantic Coast. The Nicaraguan Government has shown its commitment to the fight against the narcotics trade. However, the Nicaraguan National Police (NNP) still need significant support. Severe resource constraints and a legal system plagued with inefficiency and corruption have made it difficult for the police to make significant progress in this area.

Important legal reforms are now under consideration. During 2000, the USG provided significant assistance to the counternarcotics efforts of the Nicaraguan Police. Nicaragua's weak and under-regulated banking sector makes it a susceptible to money laundering activities. Nicaragua is a party to the 1988 UN Drug Convention.

II. Status of Country

The Government of Nicaragua (GON) has become increasingly aware of the dangers posed by drug trafficking and has focused on policy and structural changes to fight the problem. Public awareness has also increased. The primary threats are drug transshipment and consumption. Colombian and other drug trafficking organizations move drug shipments through Nicaragua mainly over land and sea routes. The Atlantic Coast, in particular, has become a way station for "go-fast" boats en route from Colombia to points further north. Traffickers often pay local facilitators in drugs, fueling growing drug consumption in the country. While Nicaragua's banking system is too small to be considered a prime target for potential money laundering, U.S. experts believe this could change if fundamental problems in Nicaraguan banking regulations are not addressed.

The Nicaraguan National Police is a capable law enforcement organization, but their effectiveness is limited by severe resource constraints and weaknesses within the criminal justice system, notably inefficiency and corruption. The army, which includes a naval unit, provides some support to Nicaraguan law enforcement in combating drug trafficking. Consumption of illegal drugs (especially crack cocaine) is a serious and growing problem, particularly along the Atlantic Coast.

III. Country Action Against Drugs in 2000

Policy Initiatives. During 2000, the GON moved forward in its efforts to modernize the country's legal machinery for confronting the narcotics trade. A proposed new criminal code is working its way through the legislature and GON officials anticipate that it will be approved in 2001. The Supreme Court approved a new Penal Procedural Code on November 24, 2000, which is being reviewed by the Justice Commission of the National Assembly. Should the bill receive final approval, the new penal code procedures would help move Nicaragua from an inquisitorial justice system (in which judges handle investigations based on written reports submitted by the police) toward becoming an accusatorial system (in which police carry out investigations and defendants can present oral arguments on their own behalf). The National Assembly has also discussed creating an independent "Public Ministry" that will give prosecutors greater autonomy.

Accomplishments. The GON took a number of important steps in 2000 to strengthen its national antidrug effort. The National Assembly formed an Institute to study the drug problem. On August 15, the Chief of the National Police and the Commander of the Army signed a formal cooperative agreement that established mechanisms to share information and coordinate counternarcotics enforcement activities. The GON increased the size of the National Police Narcotics Unit from 96 to 116 officers.

Law Enforcement Efforts. Nicaraguan authorities seized 1,693 kilograms of cocaine and three kilograms of heroin. An additional 27 kilograms of heroin that had been shipped through Nicaragua were seized in the U.S. In addition, the authorities seized 83,066 marijuana plants and 5,135 crack stones. When one includes the heroin seizures in the U.S., Nicaragua-related heroin confiscations rose significantly from the previous year.

Corruption. Efforts to resist corruption are complicated by the fact that the police have the lowest salaries in Central America—an entry-level police officer makes less than $80 a month. During 2000, the Nicaraguan Police undertook several measures to combat and control corruption in their ranks. The Police began a new system of rotating Captains and Lieutenants serving in rural areas. Personnel at the Commissioner and Sub-Commissioner level had already been subject to similar rotations. The practice is now being extended downward to lower-ranking officials in an attempt to undercut possible conflicts of interest that might develop at the local level. One officer suspected of corruption was removed from the National Police Drug unit. In early September, the Police began to issue numbered badges to officers, making it easier for citizens to identify officers who engage in questionable acts. Finally, the Nicaraguan counterdrug unit answers only to the two top ranked officials in the National Police, a practice that helps to protect sensitive information.

A growing problem is the misuse of medical parole, through which convicted individuals are obtaining releases under the guise of medical ailments. They do this largely through bribing judicial or legislative officials. In late 2000, a notorious drug suspect and former policeman, Roger Ramirez, attempted to gain freedom on medical grounds under the terms of a legislative pardon. Strong protests from the National Assembly quashed this effort.

The GON is developing a task force, to be headed by former Vice President Bolanos, that will address corruption across the government. The GON is also in the process of developing a National Integrity Plan geared toward greater transparency and governability. As part of this, the NNP and the Controller's Office have recently signed an agreement to cooperate in the fight against corruption. Finally, the National Integrity Plan calls for a civil service law to professionalize government employees.

Money Laundering. One area of specific concern is Nicaragua's weak banking sector. Though existing law requires that banks report deposits of over USD 10,000 to a Commission of Financial Analysis, this Commission has not been established. The Commission is supposed to work under the aegis of the Ministry of Government and is to be made up of representatives from a variety of government institutions, including the Police and the Superintendency of Banks. However, the Nicaraguans have neither the resources nor the technical expertise to get the Commission up and running. Consequently, money laundering laws are not yet in force and no money laundering cases have been prosecuted.

Agreements and Treaties. Nicaragua is a party to the 1961 UN Single Convention, the 1971 UN Convention on Psychotropic Substances and the 1988 UN Drug Convention. A U.S./Nicaragua extradition treaty has been in effect since 1907, however, the Nicaraguan constitution prohibits extradition of Nicaraguan nationals. Nicaragua is also a member of CFATF. In December 2000, Nicaragua signed the UN Transnational Convention Against Organized Crime.

Cultivation/Production. With the exception of marijuana, which is consumed domestically, illegal drugs are not cultivated in Nicaragua. The GON continued its ongoing eradication effort in 2000.

Drug Flow/Transit. Nicaragua's location, the endemic poverty of a large proportion of the population and the lack of resources available to law enforcement make the country an attractive transit area for international drug trafficking. The area of the country most vulnerable to drug trafficking is the sparsely populated, isolated Atlantic Coast. The many islands and tiny inlets of the Atlantic littoral provide ideal way stations and rest areas for drug smugglers moving between Colombia and points further north. Some Atlantic Coast residents support the traffickers by refueling trafficker vessels and by storing drugs. In some communities, drug smuggling has become the principal economic activity. Drugs also move north along the Pan American Highway and in fast boats that run along the Pacific Coast.

Domestic Programs. Drug consumption in Nicaragua is on the rise, particularly crack cocaine usage on the Atlantic Coast, an economically afflicted area that suffers from 60-70 percent unemployment. Drug traffickers often pay for cooperation from local citizens in kind, giving drugs to those who aid them. In addition, drug shippers threatened by interdiction in the Caribbean will frequently toss their wares overboard. These packages wash ashore in poor communities where they are viewed as a lucky find by impoverished local residents, who then divide the drugs up among village members. Both these trends contribute to increases in local usage.

The GON has responded to its growing domestic drug problem. The Ministries of Education and Health, the Police, and the Nicaraguan Fund for Children and Family (FONIF) have all undertaken limited demand reduction campaigns. Each of these agencies faces significant financial constraints in these efforts. The Minister of Education and the Police have agreed to implement a D.A.R.E. program in 2001.

III. U.S. Policy Initiatives and Programs

Bilateral Cooperation. Nicaragua and the United States now enjoy a strong counternarcotics relationship. The police have made significant progress in recent years in professionalizing their force. Since the Nicaraguan Police established formal relations with the DEA in 1997, cooperation between the two agencies has been ongoing and effective. During 2000, the U.S. continued to provide significant antinarcotics and law enforcement assistance to the National Police, both through the DEA, State/INL, and the Department of Justice's International Criminal Investigative Training Assistance Program (ICITAP). The USG provided over 30 seminars to the Nicaraguan National Police.

In response to the vast and long-term complications created by Hurricane Mitch, the USG provided Nicaragua with additional funding to fight corruption and alien smuggling and to build the country's capabilities to carry out the interdiction of drugs shipped by land. These efforts continue.

The Road Ahead. Nicaragua's leaders recognize the threat that the drug trade poses to Nicaraguan society and to Nicaraguan sovereignty. They and the police forces are committed to the antidrug effort. Nevertheless, Nicaragua faces significant challenges in countering the international drug trade, notably the lack of the necessary resources. They need to continue the internal reforms and professionalization of justice sector personnel. Nicaragua has increased its cooperation with neighboring states, via the Central American Permanent Commission against drugs (CCP) and the Inter-American Drug Abuse Control Commission (CICAD), which will help to reinforce national efforts.

The United States and other donors have undertaken programs to strengthen the technical capabilities of the Nicaraguan police and the accountability of the judicial system, which will also aid Nicaragua in its efforts to create a viable and stable democratic system. Nicaragua and the U.S. are now working to conclude a bilateral maritime agreement, which would permit joint operations in maritime interdiction efforts off the coasts of Nicaragua. The U.S. is also supporting Nicaragua's efforts to tighten regulation over the country's financial system in an effort to counter money laundering.

Panama

I. Summary

The Government of Panama (GOP) continues to demonstrate its willingness to combat drug trafficking, money laundering and other transnational crimes. In 2000, the GOP seized significant amounts of illicit drugs although trafficking routes appeared to have changed. Panama passed anti-money laundering legislation expanding the grounds on which money laundering can be prosecuted and amplified the types of businesses subject to money laundering controls. Panama is a party to the 1988 UN Drug Convention.

Panama is a major transshipment point for illicit drugs smuggled from South America. Cocaine is stockpiled in Panama before it is repackaged for transfer to the U.S. and Europe. Panama's location, its largely unpatrolled coastlines, advanced infrastructure, underdeveloped judicial system, and well-developed financial services sector make it vulnerable to transnational crime, including drug trafficking, money laundering, illicit arms sales, stolen vehicle trafficking and alien smuggling. Panama's canal, containerized seaports, the Pan-American Highway, an active international airport, and numerous uncontrolled airfields provide organized crime groups a variety of ways to transport illicit narcotics through Panama.

Panama's international banking center, the Colon Free Zone (CFZ) and its U.S. dollar-based economy attract money launderers. In addition to changing Panama's money laundering laws and regulations, with the goal of bringing them into compliance with international standards, the Moscoso Administration participated in anti-money laundering training and worked closely with the USG to achieve mutual money laundering law enforcement objectives.

II. Status of Country

Panama's proximity to the world's largest cocaine producer and its inadequate maritime, airport, and border controls continued to make Panama a major drug transit country. Domestic drug abuse continued to increase in 2000. Panama is not a significant producer of drugs or precursor chemicals. Panama's large and sophisticated banking and trading center, and its dollar-based economy, make it an attractive site for money laundering, especially through the Colombian Black Market Peso Exchange (BMPE). The BMPE is a complex network dedicated to changing U.S. dollars into Colombian pesos and is used by drug traffickers and smugglers, as well as by legitimate industry attempting to avoid trade tariffs. The Moscoso Administration took concrete steps to enhance Panama's measures to combat money laundering (see Money Laundering Section). Panama is a member of the Egmont Group (an alliances of 30 nations with centralized financial intelligence units that meet once a year) and the Caribbean Financial Action Task Force (CFATF).

III. Country Actions Against Drugs in 2000

Policy Initiatives. The National Commission for the Study and Prevention of Drug-related Crimes (Commission Nacional Para El Estudio Y la Prevencion de Los Delitos Relacionados con Droga—CONAPRED), Panama's national drug policy office, established an interagency precursor chemical control board in 2000. This board will integrate the four principal GOP entities regulating chemical control with private sector businesses involved in the chemical industry. CONAPRED also began drafting Panama's 2002 to 2007 national drug strategy. The Technical Judicial Police (PTJ) worked closely with the U.S. Embassy to develop a project that will establish Panama's first regional forensic laboratory and lead to upgrades for the PTJ's central forensic laboratory.

Accomplishments. Through CONAPRED and under the authority of the Attorney General, Panama continued to implement the National Drug Strategy 1996-2001, its own national counternarcotics plan. This program, coordinates GOP and non-governmental organizations (NGOs) and emphasize prevention, treatment, rehabilitation, supply control and interdiction. In 2000, CONAPRED worked closely with Cruz Blanca, a local NGO, and the Embassy to design Panama's first major epidemiological study of youth drug abuse since 1993. In May, Panama hosted the annual meeting of the Egmont Group of Financial Analysis Units (UAF) and in August 2000, Panama hosted the "Fourth Hemispheric Congress on the Prevention of Money Laundering." Panama's Financial Analysis Unit and the Panama Banking Association organized both events.

Law Enforcement Efforts. DEA statistics show seizures of 6,640 kilograms of cocaine, 2,490 kilograms of marijuana, 69 kilograms of heroin, 2,250 tablets of MDMA and 237 arrests for international drug-related offenses. Although Panama's cocaine seizures in 2000 were lower than its record seizures in 1997-98, they do represent a significant increase over 1999. Heroin seizures for 2000 are the highest ever recorded. The two seizures of MDMA are the first recorded in Panama. Interdiction successes in 1997-8 forced traffickers to change their trafficking patterns in 1999-2000. As a result, most of the large seizures in 2000 were the result of intelligence-driven, investigatory efforts rather than random enforcement. Significant seizures of heroin underscored Panama's key role in the transfer of heroin from Colombia into the U.S.

Although GOP inter-agency law enforcement cooperation appears to have improved, the relationship between the Public Ministry and the PTJ remained strained. U.S.-Panama bilateral cooperation with the PTJ's counternarcotics squad, which is co-housed with the Public Ministry's drug prosecutor, remained excellent. Panama's National Police (PNP) continued to support its counterpart agencies and to work with USG law enforcement agencies. The PNP's Directorate of Information and Intelligence (DIIP) played an increasing role in organizing and executing operations.

The National Maritime Service (SMN) continued to achieve success in interdicting illicit narcotics; its operations resulted in seizures of 1,496 kilograms of cocaine and six kilograms of heroin. The SMN continued to work well with the National Air Service (SAN), the Panamanian National Police (PNP), the PTJ, the drug prosecutor's office, and with its USG counterparts. The SMN participated in maritime drug intelligence sharing which contributed to the seizure of seven Panamanian flagged vessels in international waters and 17,851 kilograms of cocaine. The presence of USCG personnel to train and assist in joint mission planning and professional exchanges that are conducted during joint operations has been invaluable.

Despite limited air assets and continuing problems with maintenance and spare parts procurement, the strain of heavy commitment to Darien Province border police support and internal structural problems, the SAN continued to provide excellent support for counterdrug operations. Notable successes include the SAN's March 25 seizure of a helicopter and 350 kilograms of cocaine in Chiriqui Province. During this event, the SAN demonstrated its capability to intercept, track and force down a helicopter identified by the U.S. Customs Service (USCS) as having been purchased from drug proceeds. The SAN responded repeatedly to U.S. law enforcement requests to overfly and photograph suspect areas and to identify suspect aircraft in flight or on the ground. The SAN offered assistance to support an initiative to use Tocumen International Airport for short-notice refueling of U.S. Customs aircraft. The SAN provided crucial logistical support that enabled the U.S. Coast Guard (USCG), assisted by the SMN and the PNP, to transfer 11 Colombian prisoners and 20 kilograms of evidentiary cocaine to the U.S. The SAN and the PNP also continued to cooperate in the surveillance of areas of potential coca and marijuana growth.

Precursor Chemicals. Panama is not a major producer or significant consumer of chemicals used in processing illegal drugs. However, a large volume of chemicals transits the CFZ for other countries. In 2000, Panama further developed its regulatory/enforcement infrastructure to control the use and shipment of precursor chemicals with the assistance of the U.S. Embassy and the Inter-American Drug Abuse Control Commission (CICAD). The GOP also established an interagency precursor chemical control board that will coordinate chemical control between four GOP entities and the private sector.

Asset Forfeiture. Panama's legal system authorizes asset forfeiture, including a system for identifying and forfeiting narcotics-related assets. Through forfeiture actions the PTJ, the PNP and other GOP law enforcement agencies have acquired numerous vehicles. Panama has not specifically enacted legislation to authorize it to share seized narcotics assets with other governments but the GOP has shared assets with other countries individually. Building on negotiations between the United States Attorney's Office and the Office of Panama's Attorney General, the USG developed a draft asset sharing agreement that the GOP is reviewing. This agreement would permit asset sharing in the multi-million dollar Gonzalo Rodriguez Gacha case as well as other major narcotics trafficking cases.

Money Laundering. USG/GOP money laundering cooperation improved significantly with the Moscoso Administration. In June 2000, Panama was named by the Financial Action Task Force (FATF), as one of 15 "non-cooperative" jurisdictions in the fight against money laundering. Partly in response to this designation, the GOP, in October 2000, passed money laundering laws that greatly expanded the grounds on which money laundering can be prosecuted. The new legislation increased the number of entities required to report cash transactions of $10,000 or more and/or suspicious transactions. Executive decrees promulgated in October permitted direct sharing of information between the UAF and its foreign counterparts and the Public Ministry's investigation/prosecution unit. Also during 2000, Panama joined the Black Market Peso Exchange Group of countries. (See money laundering section).

Corruption. Corruption by lower-level officials in the police and judiciary, though often not publicized, is an impediment to drug control efforts. Although involvement in drug-related corruption is officially discouraged, weak enforcement allows much of it to go unpunished. These factors inherently foster individual corruption and make it challenging to develop long-term, criminal investigations against top-echelon drug and money laundering violators. The president of the Supreme Court is committed to making the judicial system more effective and transparent. She has worked closely with USAID to develop an Administration of Justice program launched during 2000 that targets many of the judicial system's infrastructural weaknesses, including case tracking, judicial and ethics training and alternative dispute resolution.

Agreements and Treaties. Panama is a party to the 1988 UN Drug Convention, the 1961 UN Single Convention and its 1972 Protocol, and the 1971 UN Convention on Psychotropic Substances. A mutual legal assistance treaty (MLAT) and an extradition treaty are in force between the U.S. and Panama, although the Panamanian constitution does not permit the extradition of Panamanian nationals. Panama signed a bilateral stolen vehicle treaty in June 2000. Comprehensive implementing legislation is awaiting Legislative Assembly approval.

The USG and the GOP signed a maritime operations agreement, which included provisions for shipriders and USCG support and assistance to the SMN, in 1991. In 1999, the USG concluded a Customs Mutual Assistance Agreement (CMAA) with the GOP.

The GOP participates in CICAD, the Caribbean Financial Action Task Force (CFATF), the Black Market Peso Exchange Working Group and the Basle Committees' Offshore Group of Bank Supervisors (OGBS). Panama joined the Egmont Group, an alliance of 30 nations with centralized financial analysis units to combat money laundering in 1997, becoming the group's first Latin American participant. Panama's new anti-money laundering executive decrees will also make it possible for the first time for Panama's UAF to exchange information with Egmont Group counterparts subject to memorandums of understanding with each Egmont country.

Panama has bilateral agreements on drug trafficking with the United Kingdom, Colombia, Mexico, Cuba, and Peru and MLATs with the UK, Colombia, Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua. Negotiations for a comprehensive U.S./Panama bilateral maritime agreement are underway. Panama signed the UN Convention Against Transnational Organized Crime and its protocols in December 2000.

Cultivation and Production. Eradication. Aerial reconnaissance by the SAN in 2000 indicates the presence of suspected small coca fields in one of the previously eradicated areas. As the quantity is minute and located in a very remote area near the Colombian border, it was deemed unworthy of an eradication effort. There are limited amounts of marijuana cultivated to supply the local market but are insufficient for export. Both the SAN and the PNP investigate areas of potential cultivation and to eradicate marijuana or coca when it is found. In 2000, the SMN eradicated 867 kilograms of marijuana on the Isla del Rey Perlas and in the Darien Province. Sporadic reports of drug laboratories in the Darien remain unconfirmed.

Drug Flow and Transit. Panama is a key center for the transit and distribution of South American cocaine and increasingly, precursor chemicals and heroin. Fishing vessels, cargo ships and "go-fast" boats transit Panamanian waters, continuing on to other Central American countries or dropping off their cargo in Panama. Shipments dropped off in Panama are repackaged and moved northward on the Pan-American Highway, or depart in sea freight containers. Small, low-flying planes were reported entering Panamanian airspace and dropping drug loads in remote, sparsely populated areas. Couriers transiting Panama by commercial air flights continued to move increasing amounts of cocaine and heroin to the U.S. and Europe. The quantities of Colombian heroin transiting Panama during 2000 increased significantly indicating that South American drug organizations remain committed to increasing their share of the highly profitable heroin market.

Domestic Programs (Demand Reduction). In 2000, Panama continued to implement CONAPRED's counternarcotics plan and to design its next five-year counternarcotics strategy. As part of the National Drug Strategy, CONAPRED also began its first comprehensive public national drug prevention campaign in September 2000. The demand reduction portion of the strategy stresses prevention, treatment, rehabilitation and reinsertion of drug users into the labor force. The Ministry of Education and CONAPRED, supported by NAS funding, promoted demand reduction through training for teachers, information programs, antidrug abuse training for youth, school curriculum programs. CONAPRED and the Embassy's Narcotics Affairs Section also supported the Ministry of Education's National Drug Information Center (CENAID) in 2000. These efforts were integrated with the Ministry of Health's treatment and rehabilitation programs and those of the Catholic Church, local NGOs and the University of Panama. Hogares Crea has established Panama's first long-term rehabilitation center outside of Panama City, in a rural area in Cocle Province. Working with the Embassy's Narcotics Affairs Section and the NGO Cruz Blanca, CONAPRED developed a comprehensive epidemiological survey of Panama's youth drug abuse problem and its links to violence, family break-up and other social factors. This survey will be conducted in the four major urban areas in the first quarter of 2001.

IV. U.S. Policy Initiatives and Programs

The U.S. provided crucial equipment, training, and information to enhance the performance of GOP counternarcotics and law enforcement institutions in 2000. These U.S.-supported programs are aimed at improving Panama's abilities to investigate and prosecute illegal drug trafficking and other transnational crimes, to strengthen Panama's judicial system, to assist Panama to implement its drug abuse prevention program, to encourage the enactment of more effective laws and regulations covering counternarcotics, money laundering, alien smuggling, stolen vehicle trafficking and corruption and to ensure strict enforcement of existing Panamanian laws.

The U.S., through USAID, is assisting the GOP to develop an Administration of Justice (AOJ) program to strengthen law enforcement and judicial institutions and procedures from both within and without the system. This program includes segments covering judicial transparency/ethics, developing a registry of judicial opinions, alternative sentencing proposals and commercial dispute/alternative dispute resolution proposals. The AOJ program also works to promote the development of civil society. In October, USAID sponsored Panama's first conference of six Panamanian non-governmental organizations working toward judicial reform. This group will become a focal point through which the Embassy will support Panamanians seeking to strengthen and improve Panama's judicial system.

During 2000, the U.S. Coast Guard continued to work closely with the SMN, enhancing its effectiveness as a maritime interdiction force. The U.S. traditionally has had an excellent relationship with Panamanian Customs and U.S. programs have provided Panamanian Customs with training and operational tools. The USG and GOP signed a Memorandum of Understanding in 2000 to arrange for the transfer of support equipment, including four 22-foot boats for the SMN and two vans for Customs. The Embassy's Office of Defense Cooperation transferred an 82-foot Coast Guard patrol boat to the SMN in 2000, with another scheduled to arrive in January 2001. The Office of Defense Cooperation received $590,000 in Foreign Military Financing in 2000 which is being used to help the SMN establish an Atlantic base, procure much-needed repair parts for boats transferred by the USG and training. The U.S. transferred excess Department of Defense property that had been used on U.S. bases before the reversion of the Panama Canal to the Government of Panama in December. The property, which includes boats and vehicles, is to be used for anticrime purposes.

Other USG projects begun in 2000 included: working with the GOP to upgrade its forensic laboratory and establish a satellite forensic laboratory for Panama's Western provinces, assisting the PTJ's Antinarcotics Unit's motorpool to become more effective, providing training and equipment to deter alien smuggling and vehicle theft, and upgrading the analytical capacity of the Financial Analysis Unit. The USG continued to support the Ministry of Education's teacher training for demand reduction programs, development of Panama's Joint Intelligence Coordination Center (JICC) and joint counternarcotics operations between Panamanian authorities and DEA, Customs, INS and the U.S. Coast Guard. The USG donated four narcotics detection dogs to the Customs unit at Tocumen International Airport; the canine program has already resulted in an increase in narcotics seizures.

Bilateral Cooperation. The Moscoso Administration continued its close cooperation by increasing joint counternarcotics efforts with DEA and by strengthening national law enforcement institutions. The GOP cooperated with U.S. requests to board and search Panamanian-flagged vessels suspected of drug smuggling in international waters despite the December 31, 1999 expiration of the Status of Forces agreement (SOFA) that eliminated an important framework under which counternarcotics joint operations and training had taken place. Nonetheless, the GOP has remained one of our principal partners in counternarcotics missions. Under the authority of the Attorney General and Ministry of Government and Justice, there have been seven transits of drugs or prisoners seized on the high seas, in territorial waters, and in the Panama Canal. The GOP has been extremely cooperative and forward-leaning, both with seizures within their territory as well as prosecution of targets of drug intent. It has engaged in cooperative maritime investigations with partner nations, most notably Colombia and Costa Rica. The SMN will provide four crewmembers in March 2001 for the Caribbean Support Tender, a U.S. Coast Guard vessel with a multinational crew that provides training and assistance in ship maintenance and repairs to Caribbean Coast Guards. The lack of a formal arrangement to permit short-term visits by Armed Forces personnel for law enforcement purposes hampered joint maritime and training cooperation. Due to the lack of such an arrangement, several events were cancelled that would have expanded significantly USG/GOP joint maritime interdiction efforts. Our Embassy actively seeks to reach a mutually acceptable framework with the Government of Panama to allow occasional, temporary deployments of U.S. armed services personnel to Panama for law enforcement purposes. The PTJ, Customs, the National Directorate of Immigration and the PNP, with support from the U.S. Immigration and Naturalization Service, U.S. Customs and DEA, executed two major joint interdiction operations along the Costa Rican border against alien smuggling and drug trafficking.

The Moscoso Administration drafted Panama's first-ever law enforcement/national security strategy with some U.S. assistance. This strategy was the major focus of the U.S./Panama bilateral meetings in the fall of 1999 and the spring of 2000. At these meetings, the U.S. and Panama discussed an array of issues in four bilateral working groups: social affairs and the environment, law enforcement, trade and security. The Law Enforcement Working Group exchanged information and presented recommendations on counternarcotics, extradition, asset forfeiture, justice reform, stolen vehicles, alien smuggling and money laundering.

The GOP continued to investigate important high-level drug traffickers. Some examples of major cases in 2000 include:

  • Fernando Mendoza, 1,008 kilograms of cocaine seized, 25 arrests
  • Mohamad Soueidan, 377 kilograms of cocaine, 14 arrests, six vehicles, real estate, and one CFZ business. Soueidan was a distributor of hundreds of kilograms of cocaine who used Panama as his base of operations to traffic cocaine to the U.S. and other countries.
  • Julio Munoz-Valencia, two kilograms of heroin, 1.25 kilograms cocaine, five arrests.
  • Carlos Rivera-Graell, six kilograms of heroin, five arrests, three kilograms cocaine, one arrest.
  • Miguel Barrios, six kilograms heroin, five arrests.

In June 2000, an operation to catch customs, immigration, and drug-trafficking violations culminated in the seizure of 698 kilograms of cocaine and three arrests, including Francisco Smith, the subject of a long-term Costa Rican criminal investigation.

The Road Ahead. The GOP continues to demonstrate its commitment to build strong law enforcement institutions, fight money laundering, and ensure security of the canal. The U.S. and Panama will continue to cooperate in these areas and to strengthen joint counternarcotics efforts. Conclusion of a bilateral maritime agreement and an arrangement to permit temporary deployments to Panama by U.S. Armed Forces representatives for law enforcement purposes would greatly facilitate counternarcotics joint operations and training. Panama's law enforcement efforts would be enhanced through closer coordination between its law enforcement agencies and with U.S. counterparts. The U.S. will continue to work with the GOP to help strengthen Panama's law enforcement institutional capacity, particularly in training, interdiction, investigation and prosecution.

The U.S. will support anticorruption efforts, criminal justice reform and anticrime assistance to Panama that complements Panama's counternarcotics and countercrime efforts, including assistance in the areas of alien smuggling and stolen vehicle trafficking. The U.S. will continue to assist the GOP in its efforts to implement recently passed money laundering laws to bring Panama into compliance with international money laundering standards and to increase the GOP's ability to investigate and prosecute successfully money laundering cases in Panama.

The U.S. will continue to work with the Ministries of Health and Education and NGOs to expand Panama's demand reduction program. Because of Panama's budgetary limits, we believe the GOP should develop new sources of funds to combat drug trafficking and abuse, such as those available through effective money laundering prosecutions and asset forfeiture. We will work with the GOP to explore how such possible funding sources can be exploited fully.

 

[End.]



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