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International Narcotics Control Strategy Report, 1998
Released by the Bureau for International Narcotics and Law Enforcement Affairs,
U.S.Department of State 
Washington, DC, February 1999

BOLIVIA

I. Summary

Bolivia is the third largest potential producer of cocaine in the
world. The cocaine industry in Bolivia continues to be fragmented
and dominated by small to mid-level trafficking organizations which
manufacture, transport and/or distribute cocaine base in hundred to
multi-hundred kilogram quantities per month. Most of the chemicals
utilized in processing coca leaf into cocaine base and cocaine
hydrochloride (HCl) are smuggled in from neighboring countries. Law
enforcement successes in chemical seizures have caused cocaine producers
to streamline the production process, reducing the need for certain
expensive/difficult to obtain precursor chemicals, and recycling other
essential chemicals. The result of these developments is a decrease in
the purity of some Bolivian cocaine products, causing some Brazilian
organizations to refine Bolivian base into HCl in Brazil rather than
purchasing the finished product in Bolivia.

The Bolivian government (GOB) implemented its five-year counternarcotics
plan early in 1998. As outlined in the plan, individual compensation for
eradication was completely phased out. Most of the eradication achieved
in 1998 was uncompensated and involuntary. Even so, the GOB achieved
record levels of eradication, and a substantial reduction in the amount
of coca under cultivation. Interdiction efforts were equally successful,
with increases in arrests and in chemical seizures. Alternative
development initiatives continue to provide licit alternatives to
growing coca. The Bolivian legislature has passed into law three fourths
of its judicial reform package, with only the code of criminal procedure
awaiting action.

II. Status of Country

As of the end of 1998, there were approximately 38,000 hectares of coca
under cultivation in Bolivia, a net reduction of 7,800 hectares (or 17
percent) from 1997 estimates. Of the total, there are 23,500 hectares in
the Chapare, a net reduction of 25 percent in the region where the GOB
has concentrated its eradication efforts. 14,200 in the Yungas, and 300
in other areas, most notably the Apolo region. Most newly planted coca
in the Yungas can be attributed to coca growers planting new fields to
replace those going out of production. However, as the amount of coca
being produced in the Yungas exceeds the 12,000 hectares permitted by
Bolivian law for legitimate consumption (and the 5,500 hectares a
Bolivian Non-Government Organization (NGO) estimates are actually needed
to meet legitimate uses), it is suspected by the Drug Enforcement
Administration (DEA) that much of the coca grown in the Yungas is being
made into cocaine products. The GOB has not addressed the problem of
excess cultivation in the Yungas. Almost all the coca grown in the
Chapare goes to the illegal cocaine trade. The amount grown in Apolo and
other regions is not significant, and there is no evidence it is being
grown for other than traditional use by the indigenous population.

Few of the chemicals needed to process coca leaf into cocaine HCl are
manufactured in Bolivia. Most are smuggled in from neighboring countries
with more advanced chemical industries. It is estimated by DEA that only
a small amount is being diverted by licensed importers. However,
increased interdiction of chemicals, particularly in the Chapare raised
the price of many smuggled chemicals. Bolivian lab operators are now
using inferior substitutes (cement instead of lime, sodium bicarbonate
for ammonia), recycled solvents (ether) and a streamlined production
process which virtually eliminates the oxidation stage for producing
cocaine base. Some laboratory operators are not using sulfuric acid
during the maceration stage; consequently, less cocaine alkaloid is
extracted from the leaf, producing less HCl. The lower quality of
Bolivian cocaine has already begun to affect its marketability.
Reportedly, some Brazilian organizations are purchasing only cocaine
base from Bolivia and are refining their own cocaine HCl in Brazil.

III. Country Actions Against Drugs in 1998

Policy Initiatives. The GOB adopted and implemented the country's first
comprehensive counternarcotics strategy, the Dignity Plan, early in
1998. The plan consists of four "pillars." eradication,
interdiction, alternative development and prevention. Its goal is to rid
Bolivia of all excess coca by the year 2002. A combined military/police
force sent to the Chapare in April to quell riots protesting
implementation of the plan was converted into an eradication/security
force which has since achieved record levels of eradication and has
firmly established government control in the region for the first time.
Even in the face of armed resistance, the GOB phased out individual
compensation for eradication.

The GOB enacted three judicial reforms (the Judicial Council, the Office
of the Ombudsman and the Constitutional Tribunal) which should help
reduce the backlog of cases awaiting consideration by the Supreme Court,
provide a less political process for the selection of judges, establish
an alternative and more efficient mechanism for the investigation of
judicial corruption and make the justice system more accessible. A
fourth bill, a new Code of Criminal Procedure, is being debated in the
Senate and may be amended to include desirable key reforms left out by
the Chamber of Deputies. The use of undercover agents and informants,
controlled deliveries, plea bargaining, and in rem asset seizure and
forfeiture. The final bill may also include a stronger conspiracy law.
Bolivia's 1996 anti-money laundering law has not been enforced, although
a director for the Financial Investigations Unit of the Superintendency
of Banks was named in 1998.

A fixed and roving checkpoint program, special intelligence/operations
units focusing on both narcotics and essential chemicals and other
investigative efforts have resulted in increases from FY1997 totals in
all quantitative categories. Arrests are up by 42 percent, chemical
seizures by 13 percent, and drug seizures by one percent.

Accomplishments. Agreements and Treaties. Bolivia is a party to 1988 UN
Convention against Trafficking in Illicit Drugs and Psychotropic
Substances.

Cultivation and Production. Total cultivation of coca in Bolivia was
38,000 hectares at the end of 1998, 7,800 less than a year earlier. Of
the total, 28,600 hectares were of mature, harvestable coca, an 18
percent reduction from the previous year. During 1998, 11,621 hectares
were eradicated, while only 3,820 hectares of new coca were planted.

One hectare of Chapare coca yields an average of 2.7 metric tons of
sun-dried coca leaf, which produces about 7.44 kilograms of cocaine. The
eradication of 11,621 hectares of Chapare coca during this year
prevented approximately 85 metric tons of cocaine from being produced
and exported to the United States and other destinations. This
represents a fifth consecutive year of decline in potential cocaine
production and a decrease from 200 metric tons in 1997 to 150 metric
tons in 1998. Moreover, the decline of new coca planted and the
destruction of some 68,578 square meters of seedbeds ensures this trend
will continue if the GOB's aggressive eradication effort is sustained in
1999.

Interdiction. Seizures of HCl (down by 21 percent) and cocaine base (up
by 11 percent) resulted in an overall increase in drug seizures from
last fiscal year's levels. Coca leaf seizures were three times last
year's low levels. The increased effectiveness of the chemical
interdiction program forced Bolivian lab operators to use less efficient
processing techniques, and, surprisingly, to begin using cutting agents
such as mannitol, or milk sugar (more typically associated with the
retail sale of cocaine), to increase the bulk and weight of their
shipments.

Alternative Development. The U.S. Agency for International Development
(USAID) provides core support for the GOB's alternative development
activities--consolidating the agriculture and infrastructure network,
enabling farmers to support themselves and their families without the
need to cultivate coca. INL-funded, USAID-supported organizations are
contributing to net coca reduction by providing alternative development
assistance to those communities and farmer organizations that are
willing to eliminate all of their coca or had all of their coca forcibly
eradicated. The success of the GOB's alternative development program has
enabled 73 Chapare communities and producer associations to sign coca
eradication agreements with Bolivia's eradication agency (DIREC0) from
July 1997 to October 1998.

Licit production of commercially viable crops in the Chapare has
increased from about 40,613 hectares in 1986 to approximately 105,000
hectares in 1998 (a 159 percent improvement)--three times greater than
Chapare coca cultivation. Total farmgate sales of the five priority
crops promoted by USAID (bananas, pineapples, palm hearts, black pepper
and passion fruit) increased by 55 percent in the third quarter of CY98
compared with the same quarter in CY97, while farmers' net income from
those crops increased by 52 percent over the same period. More than
ever, these results show that alternative development is increasingly
enabling the GOB to undertake aggressive eradication campaigns while
maintaining public support for those efforts.

However, the demand for alternative development exceeds the ability of
the GOB to meet it. With the elimination of individual compensation for
eradication, the GOB has not developed a comprehensive plan for
addressing community-based needs. Considerable resources have already
been provided for infrastructure improvements; therefore, these types of
projects will be increasingly difficult to offer as compensation
packages for voluntary eradication. Furthermore, upwards of 20,000
miners-turned-coca growers do not want to become traditional farmers, so
job training and possible resettlement into areas of Bolivia where
employment is available may be necessary.

Asset Seizure. The sale of seized property has been consistently stalled
by recalcitrant judges--a problem the government has not been able to
overcome. Moreover, the Directorate of Seized Assets has still not
accounted for a large portion of the property listed in its inventories.
As a consequence, the USG has suspended its assistance to the
Directorate, and the GOB is considering privatizing the control and sale
phases of the Directorate's operations.

Extradition. Only one extradition was carried out in 1998, that of a
U.S. citizen who had completed his sentence for narcotics offenses in
Bolivia. There are currently seven USG extradition requests pending
before the Supreme Court of Bolivia.

Enforcement Efforts. Under the previous administration, the Minister of
Government was responsible for all aspects of the counternarcotics
effort. While this arrangement was convenient, the separation of
responsibilities effected by the present government has been more
productive. The Secretariat for Social Defense has been granted
Vice-Ministerial status, and, while still part of the Ministry of
Government, it now enjoys a greater degree of autonomy and is in charge
of all interdiction forces in Bolivia, including the special military
task forces. Responsibility for eradication and alternative development
has been transferred to the Minister of Agriculture, and both programs
have flourished under a minister who can dedicate more attention to
these inextricably linked aspects of the counternarcotics effort.

The Bolivian Air Force (FAB) has established fixed tours of duty for all
its personnel who serve in the Red Devil Task Force, a USG-funded
helicopter unit, and also agreed to give full credit toward promotion
for training received while a member of that organization. These changes
will ensure continuity and help retain skilled pilots and maintenance
personnel. The FAB has also agreed to create a special unit dedicated to
flying only USG-supported C-130 aircraft, which will lend further
assurance that the pilots of these aircraft will respond correctly in an
emergency.

The USG-funded Blue Devil Task Force of the Bolivian Navy, a riverine
unit, was granted limited law enforcement authority last year.
Substantial retraining has been necessary to prepare members of the
organization to carry out their new responsibilities; however, the Blue
Devil Intelligence Operations Unit has already produced impressive
results.

Corruption. The current government neither condones, encourages nor
facilitates any aspect of narco-trafficking, and there have been no
major cases of public corruption during 1998. Bolivia's small to
mid-sized trafficking organizations do not seem to exercise a corruptive
influence at the higher levels of the Bolivian government. Nonetheless,
judicial corruption continues to be a problem, and there is substantial
evidence that some police and military personnel are actively involved
in narcotics trafficking. The newly appointed Judicial Council appears
to be taking its mandate seriously, and has reviewed the performance of
30 judges and suspended one of them.

Demand Reduction Programs. The GOB has created a Vice-Ministry for
Prevention within the Ministry of Government, which is responsible for
implementing the prevention pillar of the dignity plan. Although the GOB
plan emphasizes prevention, it also contains a rehabilitation component.
The Vice-Ministry is cooperating closely with USG-supported NGOs, but
plans to implement its own programs after the GOB's new budget is
approved in early 1999.

IV. U.S. Policy Initiatives and Programs

Policy Initiatives. Key elements of the USG counternarcotics strategy,
originally developed in 1995, have been incorporated into the GOB's
Dignity Plan, which stresses the need for an aggressive interdiction
effort, a systematic eradication program and a viable alternative
development program which provides credible alternatives to the
cultivation of coca. The government understands it must have broad
public support to achieve its counternarcotics goals, but continues to
rely heavily on USG-funded public diplomacy programs rather than on its
own initiatives.

Bilateral Cooperation. A Binational Commission meets regularly to
monitor progress toward the goals set out in the 1998-1999 USG-GOB
counternarcotics agreements and to consider new programs and
initiatives. Its membership includes the Bolivian Ministers of
Government, National Defense and Agriculture, other relevant Bolivian
officials and key counternarcotics officers of the U.S. Embassy in La
Paz

The Road Ahead. Since 1994, Bolivia's capacity to produce cocaine has
been reduced from 255 tons per year to 170 metric tons. The GOB's
eradication plan for 1999 was reviewed at the December meeting of the
Binational Commission, and will be implemented early in January. If
successful, the eradication program should produce further dramatic
reductions in the amount of coca under cultivation and in Bolivia's
capacity to produce cocaine. Without adequate emphasis on the
alternative development program, an interdiction/eradication initiative
in the Yungas, and the enforcement of Public Law 1008 provisions
permitting the arrest of those who plant new coca fields, the GOB will
not meet its goals next year. This year's interdiction successes will
not be equaled, much less exceeded, if the new Code of Criminal
Procedure does not provide law enforcement agencies with the modern
tools they need to investigate and prosecute narcotics offenders. The
GOB also needs to focus increased attention on official corruption.

[end of document]

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