Andean Counterdrug Initiative (ACI) and Related Funding Programs: FY2006 Assistance
Released: 2006-01-27T00:00:00

Summary:
In 2005, Congress considered a number of issues relating to the Andean region and drugtrafficking, including continued funding for the Andean Counterdrug Initiative (ACI) and conditionson U.S. assistance. In addition to ACI, Andean countries benefit from Foreign Military Financing(FMF), International Military Education and Training (IMET) funds, and other types of economicaid. Congress continues to express concern with the volume of drugs readily available in the UnitedStates and elsewhere in the world. The three largest producers of cocaine are Colombia, Bolivia, andPeru. Ninety percent of the cocaine in the United States originates in, or passes through, Colombia.
The United States has made a significant commitment of funds and material support to helpColombia and the Andean region fight drug trafficking since the development of Plan Colombia in1999. From FY2000 through FY2005, the United States has provided a total of about $5.4 billionfor the region in both State Department and Defense Department counternarcotics funds. The UnitedStates also provides funding for Development Assistance (DA), Child Survival and Health (CSH),and Economic Support Funds (ESF) to some countries in the region. Since 2002, Congress hasgranted expanded authority to use counternarcotics funds for a unified campaign to fight both drugtrafficking and terrorist organizations in Colombia. Three illegally armed groups in Colombiaparticipate in drug production and trafficking, and have been designated foreign terroristorganizations by the State Department. In 2004, Congress also increased the level of U.S. militaryand civilian contractor personnel allowed to be deployed in Colombia, in response to anAdministration request.
For FY2006, Congress approved the Administration's request for $734.5 million for ACI inthe Foreign Operations Appropriations Act ( H.R. 3057 / P.L. 109-102 ). As part of therequested amount for ACI, the Administration had requested $21 million for the Air Bridge DenialProgram; Congress provided $14 million. The request also included $40 million for a Critical FlightSafety Program that is described as the first installment of a multi-year program to upgrade andrefurbish aircraft used for eradication and interdiction missions. Congress provided $30 million.
In the House, the Foreign Relations Authorization Act ( H.R. 2601 ) was passedwith provisions relating to the demobilization process, tax code enforcement in Colombia, and thetransfer of aircraft to the Colombian Navy. The Senate did not finish consideration of its version( S. 600 ). It would authorize funding for the Andean Counterdrug Initiative and includesa number of conditions on assistance consistent with current law. The FY2006 National DefenseAuthorization Act ( H.R. 1815 , P.L. 109-163 ) authorized funds for Defense Departmentinterdiction activities.
This report will not be updated. For further information, see CRS Report RL32774 , PlanColombia: A Progress Report ; CRS Report RL32250 , Colombia: Issues for Congress ; and CRS Report RL32337 , Andean Counterdrug Initiative (ACI) and Related Funding Programs: FY2005Assistance.

subsections: section_title: Andean Counterdrug Initiative
paragraphs: The Andean Counterdrug Initiative was designed to provide assistance to seven countries inthe broadly defined Andean region: Bolivia, Brazil, Colombia, Ecuador, Panama, Peru, andVenezuela. (3) The regionis important to the U.S. drug policy because it includes three major drug producing countries(Colombia, Bolivia, and Peru) where virtually all the world's cocaine and significant quantities ofhigh quality heroin destined for the United States are produced. U.S. objectives for the ACI programare to eliminate the cultivation and production of cocaine and opium, build law enforcementinfrastructure, arrest and prosecute traffickers, and seize their assets. 
The region also includes two major oil producing countries (Venezuela and Ecuador),members of the Organization of Petroleum Exporting Countries (OPEC), which supply significantquantities of oil to the United States. For the five traditional Andean countries (Colombia,Venezuela, Ecuador, Peru, and Bolivia), the Andes mountain range that runs through South Americaposes geographical obstacles to intra-state and inter-state integration, but the countries are linkedtogether in the Andean Community economic integration pact. 
U.S. support for Plan Colombia began in 2000, when Congress passed legislation providing$1.3 billion in interdiction and development assistance ( P.L. 106-246 ) for Colombia and six regionalneighbors. Funding for ACI from FY2000 through FY2005 totaled nearly $4.3 billion. ACI ismanaged by the State Department's Bureau of International Narcotics Control and Law EnforcementAffairs (INCLE). Some ACI funds are transferred to the U.S. Agency for International Development(USAID) for alternative development programs. 
ACI funds are divided between programs that support eradication and interdiction efforts,as well as those focused on alternative crop development and democratic institution building. Onthe interdiction side, programs train and support national police and military forces, providecommunications and intelligence systems, support the maintenance and operations of host countryaerial eradication aircraft, and improve infrastructure related to counternarcotics activities. On thealternative development side, funds support development programs in coca growing areas, includinginfrastructure development, and marketing and technical support for alternative crops. It alsoincludes assisting internally displaced persons, promoting the rule of law, and expanding judicialcapabilities. 
ACI also funds the Air Bridge Denial Program that is currently operational in Colombia, andtemporarily suspended in Peru, after an accidental shooting down of a civilian aircraft carrying U.S.missionaries in 2001. After the incident, in which two Americans died, the program in bothcountries was suspended until enhanced safeguards were developed. The program in Colombiaresumed in August 2003. The program supports an aircraft fleet, pilot training, and logistical andintelligence support. The program tracks aircraft suspected of being involved in drug trafficking,and forces them to land for inspection. If the aircraft is repeatedly unresponsive, it may be shotdown, at the direction of the commander of the Colombian Air Force. The resumption of a programin Peru is still pending the development of safety enhancements. 
subsections: section_title: FY2006 Funding Levels
paragraphs: The Administration requested a total of $734.5 million for FY2006 for the AndeanCounterdrug Initiative, an increase from the FY2005 estimate of $725.2 million. Included as partof the request was $21 million for the Air Bridge Denial Program, that would continue contractorlogistical support and training for operations in Colombia. The request also included a newcomponent, $40 million for a Critical Flight Safety Program that was described as the firstinstallment of a multi-year program to upgrade and refurbish of State Department aircraft used foreradication and interdiction missions. 
In the FY2006 Foreign Operations Appropriations Act ( H.R. 3057 , P.L.109-102 ), Congress approved the Administration's request of $734.5 million for ACI but changedhow those funds are allocated. Congress provided $14 million for the Air Bridge Denial programinstead of the requested $21 million. For the new Critical Flight Safety program, Congress provided$30 million instead of the requested $40 million. Congress also recommended different fundinglevels for Colombia and Peru, as noted below. 
 Table 1. Andean Counterdrug Initiative FY2006 ForeignOperations Conference Report 
( P.L. 109-102 / H.Rept. 109-265 )
(in millions $)
* The conference report directed $131.2 million for alternative development and $27.4 million forRule of Law programs.
section_title: Related Funding Programs
paragraphs: Additional funding for the Andean region is provided through the Foreign Military Financing(FMF) program and the International Military Education and Training (IMET) program, bothmanaged by the State Department. The Defense Department has a counternarcotics account forworldwide programs involving interdiction, training, equipment, and intelligence sharing. In theWestern Hemisphere, these programs are managed by the U.S. Army Southern Command.
subsections: section_title: Foreign Military Financing (FMF)
paragraphs: Foreign Military Financing (FMF) provides funding grants to foreign nations to purchaseU.S. defense equipment, services, and training. The program's objectives are to assist key allies toimprove their defense capabilities, to strengthen military relationships between the United States andFMF recipients, and to promote the professionalism of military forces in friendly countries. FMF isprovided to Colombia and the Andean region to support the efforts of those nations to establish andstrengthen national authority in remote areas that have been used by leftist guerrilla organizations,rightist paramilitaries, and narcotics traffickers. A portion of FMF funding in Fiscal Years 2002 and2003 went for infrastructure protection of oil pipelines in Colombia. The FY2005 estimate for theAndean region was $103 million, with $99 million for Colombia. 
The FY2006 request was for $94 million for the region, with Colombia proposed to receive$90 million, mainly to provide operational support and specialized equipment to the Colombianmilitary, with a focus on the Colombian Army's specialized and mobile units, and units assigned toprotect the CaÃ±o LimÃ³n oil pipeline. Bolivia was proposed to receive $1.8 million, Ecuador$750,000, Panama $1.1 million, and Peru $300,00 to strengthen their capabilities to interdict drugproduction and trafficking. In the FY2006 Foreign Operations Appropriations Act( H.R. 3057 , P.L. 109-102 ), Congress earmarked funds for some countries, but none inLatin America. The Administration has $242 million to fund remaining unearmarked countries, forwhich they requested $318 million. It is likely that amounts requested for some Andean recipientscould be trimmed to accommodate the decrease in available funds.
section_title: International Military Education and Training (IMET)
paragraphs: The IMET program provides training on a grant basis to students from allied and friendlynations. Its objectives are to improve defense capabilities, develop professional and personalrelationships between U.S. and foreign militaries, and influence these forces in support of democraticgovernance. Training focuses on the manner in which military organizations function under civiliancontrol, civil-military relations, military justice systems, military doctrine, strategic planning, andoperational procedures. IMET funding for the Andean region was estimated at $3.7 million inFY2005 out of a total of $14 million for all of Latin America. The request for FY2006 for theAndean countries was $3.5 million out of a hemisphere-wide total 
of $13.7 million. The request for Colombia was $1.7 million and would focus on civil-military issuesfor junior and mid-grade military officers. For FY2006, Congress provided the Administration'sworldwide request of $86.74 million, so it is likely that Andean countries will receive the requestedamounts.
section_title: Defense Department Counternarcotics Account
paragraphs: The Department of Defense has authority for counternarcotics detection and monitoringunder Sections 124, 1004, and 1033 of the National Defense Authorization Act. DOD requests alump sum for counternarcotics programs worldwide and does not request amounts by country. Theestimated amount for Colombia in FY2004 ranges from $122 million to $160 million. The estimatefor FY2005 DOD counternarcotics funding for Latin America is $366.9 million, of which up to $200million is planned for Colombia. 
DOD requested a total of $896 million globally for counternarcotics programs, of which itestimated spending $368 million in Latin America in FY2006. Of this amount, $122 million wouldbe in direct support of Colombia. Activities include detection and monitoring operations to assistU.S. law enforcement agencies interdict drug trafficking. In the Andean region, support is providedin the form of training, equipment, and intelligence sharing activities. The FY2006 DefenseAppropriations Act ( H.R. 2863 , P.L. 109-148 ) provided $917.65 million for druginterdiction programs worldwide. 
section_title: U.S. Counternarcotics Assistance By Country
subsections: section_title: Colombia(4)
paragraphs: Colombia receives the single largest portion of ACI funds. For FY2006, the Administrationrequested $463 million, of which $311 million was for interdiction and eradication efforts, $125million for alternative development and institution building programs, and $27 million for rule oflaw programs. Interdiction funds would support the Colombian military's aviation program and drugunits with training, logistics support, operating expenses, equipment, and to upgrade forwardoperating locations. Assistance would also be used to support Colombian National Police aviation,eradication and interdiction programs with equipment, logistical support, training, new baseconstruction, communications and information links. Alternative development programs wouldsupport the introduction of new licit crops, the development of agribusiness and forestry activities,and the development of local and international markets for new products. Rule of law assistancewould help promote democracy through judicial reform, support for vulnerable groups, and trainingand technical assistance for advisors in rule of law areas. ACI funds would also be used to assist theBureau of Alcohol, Tobacco and Firearms provide training and support to bomb squads in an effortto stem terrorist bombings in Colombia.
In the FY2006 Foreign Operations Appropriations Act, Congress provided a total of $469.5million for Colombia, divided among $310.9 million for interdiction, $131.2 million for alternativedevelopment, and $27.4 million for rule of law programs. The amount for alternative developmentrepresents a $6.5 million increase from FY2005 levels. Colombia also receives small amounts ofNon-proliferation, Anti-terrorism, Demining and Related Programs (NADR).
Colombia's spacious and rugged territory, whose western half is transversed by three parallelmountain ranges, provides ample isolated terrain for drug cultivation and processing, and contributesto the government's difficulty in exerting control throughout the nation. The country is known fora long tradition of democracy, but also for continuing violence, including a guerrilla insurgencydating back to the 1960s, and persistent drug trafficking activity. Recent administrations have hadto deal with a complicated mix of leftist guerrillas, rightist paramilitaries (or "self-defense" forces),and independent drug trafficking cartels. The two main leftist guerrilla groups are the RevolutionaryArmed Forces of Colombia (FARC) and the National Liberation Army (ELN). The rightistparamilitaries are coordinated by the United Self-Defense Forces of Colombia (AUC). All threegroups participate in drug production and trafficking, regularly kidnap individuals for ransom, andhave been accused of gross human rights abuses. The three have been designated foreign terroristorganizations by the United States. The AUC and Colombian military have been accused ofcollaborating in fighting the FARC and ELN.
 Table 2. U.S. Counternarcotics Assistance to Colombia,FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justificationsfrom the Department of State and the USAID Budget Justifications for fiscal years 2002 through2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ) and Conference Report( H.Rept. 109-265 ), and congressional testimony.
section_title: Peru
paragraphs: Peru is the second largest recipient of ACI funding with $97 million requested for FY2006. This represented a reduction from $115.4 million in FY2005. ACI funding would be split between$54 million for interdiction and $43 million for alternative development and institution building. Interdiction funds would focus on improving Peruvian airlift operations, using U.S.-owned assets,determining the extent of coca cultivation in the country, demand reduction and money launderingprograms. Alternative development funds would rehabilitate roads, bridges, schools and health careaccess, land reform, and agri-business. 
For FY2006, Congress directed that Peru receive $108 million, of which $59 million wouldbe for interdiction and $49 million for alternative development. Unlike previous years, Congressdid not include a provision requiring notification prior to restarting the Air Bridge Denial programin Peru.
Peru shares its northern border with Colombia, and is the second largest cocaine producerin the world. It exports high purity cocaine and cocaine base to markets in South America, Mexico,Europe, and the United States. Nevertheless, Peru has been viewed as a success story incounternarcotics efforts because joint U.S.-Peru air and riverine interdiction operations, aggressiveeradication efforts, and alternative development programs have significantly reduced cocaproduction. Facing mounting protests, the Peruvian government temporarily suspended theeradication program in the Upper Huallaga Valley in early July 2002, but resumed the program inSeptember 2002 once concerns were addressed, in part to be eligible for Andean Trade PreferenceAct benefits. The State Department reports that coca cultivation had decreased in Peru by 15% in2003. For 2004, the ONDCP reported a slight decrease, while the United Nations reported a 14%increase. (5) 
Counternarcotics policy in Peru has faced growing resistance from indigenous communitiesthat view coca leaf cultivation as a cultural right and source of income. A 2004 Peruvian studyfound that approximately two million people use coca leaf either habitually or occasionally, andanother two million use it for tea, or for traditional or ceremonial purposes. Some regions haveattempted to de-criminalize coca growing, a move which the President Toledo government hasresisted. With Toledo's low popularity and growing discontent in coca growing regions, someobservers believe the government is unwilling to take on the increasingly assertive cocagrowers. (6) 
 Table 3. U.S. Counternarcotics Assistance to Peru, FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justifications forfiscal years 2002 through 2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ),and Conference Report ( H.Rept. 109-265 ).
section_title: Bolivia(7)
paragraphs: For FY2006, the Administration proposed spending $80 million in Bolivia, a reduction from$90 million in FY2005. The requested amount would be divided between $43 million forinterdiction and $37 million for alternative development and institution building. Interdiction fundswould continue eradication programs in the Chapare and Yungas regions, provide training for police,maintain support for Bolivian security forces riverine and ground operations, and aviation programs. Alternative development would continue support for the production of licit crops, and establishintegrated justice centers in conflictive regions. For FY2006, Congress approved theAdministration's request.
Landlocked Bolivia shares no border with Colombia, but Bolivia's significant gains inreducing illegal coca production could be threatened by any successes in controlling production inColombia. At one time the world's foremost producer of coca leaf, Bolivia made great strides inreducing coca cultivation under the Banzer-Quiroga administration (1997-2002). (8) However, forcible eradicationof coca has become a source of social discontent, exacerbating tensions over class and ethnicity thatmay foment political instability in Latin America's poorest country. Moreover, according to the StateDepartment, coca cultivation increased 23% in 2002 and 17% in 2003. (9) Nevertheless, Bolivia's cocacultivation is still about half of its 1995 levels. 
For some 20 years, U.S. relations with Bolivia have centered largely on controlling theproduction of coca leaf and coca paste, which was usually shipped to Colombia to be processed intococaine. In support of Bolivia's counternarcotics efforts, the United States has provided significantinterdiction and alternative development assistance, and it has forgiven all of Bolivia's debt fordevelopment assistance projects, and most of the debt for food assistance. There has been growingpublic opposition to Bolivia's counternarcotics policy that has served to fuel to popular discontentthat has contributed to political instability. Some critics believe that U.S. policy supporting forceddrug crop eradication is contributing to popular support for left-of-center opposition political figures. Coca growers ( cocaleros ) have organized themselves in legally recognized labor unions, and haveformed a political party, Movement Toward Socialism (MAS). The MAS presidential candidate,Evo Morales, who came in a close second in 2002 presidential elections, won the presidency inDecember 2005. Considering Morales' comments critical of U.S. counternarcotics policy in theregion, the future of U.S.-Bolivian relations is unclear.
 Table 4. U.S. Counternarcotics Assistance to Bolivia,FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justifications forfiscal years 2002 through 2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ),and Conference Report ( H.Rept. 109-265 ).
section_title: Ecuador(10)
paragraphs: Ecuador is the next largest recipient of ACI funds, with $20 million appropriated for FY2006. This represented a reduction from nearly $26 million in FY2005. Funds would be divided between$8.5 million for interdiction and $11.5 million for alternative development and institution building. The objective of assistance to Ecuador is to stop or prevent any spillover of drug trafficking andguerrilla activities from Colombia, and to stop the transit of drugs destined for the United States.
On Colombia's southern border, Ecuador is the most exposed of Colombia's neighbors, beingsituated adjacent to areas in southern Colombia that are guerrilla strongholds and heavy drugproducing areas. As a major transit country for cocaine and heroin from Colombia and Peru,Ecuador cooperates extensively with the United States in counternarcotics efforts. Nonetheless, theState Department reports that weak public institutions, the uneven implementation of new criminalproceedings, and widespread corruption limit the country's ability to counter drug trafficking. In2004, the Ecuadoran government published a new national drug strategy and implementation plan,with a focus on strengthening institutions and drug trafficking laws, and providing more resourcesfor its drug agency, the National Drug Council. In November 1999, the United States signed a10-year agreement with Ecuador for a forward operating location (FOL) in Manta, on the PacificCoast, for U.S. aerial counterdrug detection and monitoring operations. 
According to press reports, Colombian guerrillas pass into Ecuadoran territory for rest,recuperation, and medical treatment, and FARC camps have been detected in Ecuador's northernprovince of Sucumbios, where it was reported that barracks, ammunition, explosives and radioequipment were found. (11) Ecuadoran officials say they have uncovered and destroyedseveral small cocaine processing labs in the area. The Ecuadoran border region is experiencing aconstant flow of Colombian refugees into the poor areas, and fighters with Colombian paramilitaryorganizations have been arrested for running extortion rings in Ecuadorian border regions. Ecuadoran officials have complained that the armed conflict and drug trafficking in Colombia ishaving an adverse affect on Ecuadoran peasants in border areas, and that the aerial fumigation inColombia is harming the Ecuadoran environment and negatively affecting Ecuadorans' health. (12) 
 Table 5. U.S. Counternarcotics Assistance to Ecuador,FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justifications forfiscal years 2002 through 2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ),and Conference Report ( H.Rept. 109-265 ).
section_title: Brazil
paragraphs: FY2006 ACI funds appropriated for Brazil total $6 million mainly for interdiction and lawenforcement activities. The goal is to prevent any spillover effect from Colombia. Congressapproved the Administration's request. Brazil's isolated Amazon region, populated largely byindigenous groups, forms Colombia's southeastern border. Brazil is not a significant drug-producingcountry, but it is a conduit for the transit of coca paste and cocaine from Colombia to Europe andthe United States. It is also becoming a final destination, with marked increases in crack cocaine andheroin abuse.
Brazil passed an omnibus federal counternarcotics law in 2002, and adopted a new nationalstrategy to deal with money laundering in 2004. Also in 2004, Brazil began implementing a 1998shoot-down law, in which the Air Force has the authority to use lethal force against civilian aircraftreasonably suspected to be engaged in drug trafficking. Brazilians have long been concerned aboutthe sparsely populated territory in the huge Amazon region, and they have been fearful historicallyof foreign intervention in this territory. In an effort to exercise control over this vast territory, Brazilhas constructed a $1.4 billion sensor and radar project called the Amazon Vigilance System (SIVAMfrom its acronym in Portuguese), offering to share data from this system with neighbors and theUnited States. It has established a military base at Tabatinga, with 25,000 soldiers and policemen,with air force and navy support. In 2000, it launched COBRA, an inter-agency border securityprogram to deal with spillover effects from Colombia. In 2003, Brazil expanded COBRA-like toits northern borders with Peru, Venezuela, and Bolivia. The programs focus on controlling land andair entry into Brazil and is headquartered at Tabatinga.
 Table 6. U.S. Counternarcotics Assistance to Brazil,FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justifications forfiscal years 2002 through 2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ),and Conference Report ( H.Rept. 109-265 ). Brazil did not received FMF during this time period.
section_title: Venezuela(13)
paragraphs: The Administration proposed spending $3 million in FY2006 counternarcotics assistance toVenezuela largely for interdiction and law enforcement purposes. Congress appropriated $2.3million. Because of Venezuela's extensive 1,370-mile border with Colombia, it is a major transitroute for cocaine and heroin destined for the United States. 
According to the Department of State's March 2005 International Narcotics Control StrategyReport (INCSR), cocaine seizures by the Venezuelan government amounted to 17.8 metric tons (mt)in 2002, 19.5 mt in 2003, and 19.1 mt during the first six months of 2004. Despite some friction inU.S.-Venezuelan relations that increased in 2005, cooperation between the two countries at the lawenforcement agency level led to significant cocaine seizures in 2004. The INCSR report assertedthat Venezuela carried out some 400 cocaine and heroin seizures in the first half of 2004 and thatseveral important cocaine and heroin trafficking organizations were effectively attacked in 2004,including several important extraditions. Nevertheless, the Department of State maintained in thereport that Venezuela needs to make substantial efforts in five areas: passing an Organized CrimeLaw; making effective efforts to combat corruption; cracking down on document fraud; enforcingcourt-ordered wiretaps; and conducting opium poppy and coca eradication operations at leastannually. 
On September 15, 2005, President Bush designated Venezuela, pursuant to international drugcontrol certification procedures set forth in the Foreign Relations Authorization Act, FY2003 ( P.L.107-228 ), as one of two countries that has failed demonstrably to adhere to its obligations underinternational narcotics agreements. At the same time, the President waived economic sanctions thatwould have curtailed U.S. assistance for democracy programs in Venezuela, and ACI funding willnot be affected.The justification noted that despite Venezuela's increase in drug seizures overthe past four years, Venezuela has not addressed the increasing use of Venezuelan territory totransport drugs to the United States. According to the State Department, the overall picture is oneof decreasing Venezuelan focus on counternarcotics initiatives and reduced cooperation with theUnited States.
 Table 7. U.S. Counternarcotics Assistance to Venezuela,FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justifications forfiscal years 2002 through 2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ),and Conference Report ( H.Rept. 109-265 ). Venezuela did not receive FMF during this period.
section_title: Panama(14)
paragraphs: For FY2006, the Administration proposed, and Congress approved, $4.5 million forcounternarcotics programs to assist Panama. Because of its geographic location bordering Colombiaat the crossroads of North and South America, its largely unguarded coastline, and itswell-developed transportation, banking, trade and financial sectors, Panama is a major transit routefor illicit drugs and an attractive site for money laundering. The country is on the President's list ofmajor drug transit countries and has been on the State Department's list of "countries of primaryconcern" for money laundering for the past three years. Drug traffickers use fishing vessels, cargoships, small aircraft, and go-fast boats to move illicit drugs -- primarily cocaine, but also heroin andEcstasy -- through Panama. 
According to the Department of State, security in Panama's Darien region borderingColombia has improved in recent years, although the smuggling of weapons and drugs across theborder continues. Drugs and arms trade associated with Colombian terrorist groups also reportedlyoccurs in other parts of Panamanian territory and in the country's coastal waters, according to theU.S. DEA. (15) According to the Department of State's International Narcotics Control Strategy Report, Panama'scooperation with the United States on counternarcotics efforts is excellent, although the country'sdifficult fiscal situation has impeded Panama's law enforcement ability. For this reason, theDepartment of State maintains that U.S. assistance is critical in ensuring effective Panamanian lawenforcement. 
 Table 8. U.S. Counternarcotics Assistance to Panama,FY2000-FY2006
(in millions $)
Sources: Figures are drawn from the annual State Department and USAID Budget Justifications forfiscal years 2002 through 2006, the FY2006 Foreign Operations Appropriations Act ( P.L. 109-102 ),and Conference Report ( H.Rept. 109-265 ).
section_title: Congressional Conditions on ACI Assistance
paragraphs: Since first approving expanded assistance to Colombia for counternarcotics programs in2000, Congress has included a number of conditions on U.S. assistance in both authorization andappropriations legislation. The most recently enacted funding legislation is the FY2006 ForeignOperations Appropriations Act ( H.R. 3057 , P.L. 109-102 ), which included a numberof longstanding provisions relating to the Andean Counterdrug Initiative. The FY2005 NationalDefense Authorization Act ( H.R. 4200 , P.L.108-375 ) also included provisions relatingto Colombia. The FY2006 National Defense Authorization Act ( H.R. 1815 , P.L.109-163 ) authorized funding for Department of Defense drug interdiction activities. 
subsections: section_title: Expanded Authority
paragraphs: Both the FY2006 Foreign Operations Appropriations Act and the FY2005 the NationalDefense Authorization, maintains language, first approved by Congress in 2002, authorizing supportfor a unified campaign against narcotics trafficking and activities by organizations designated asterrorist organizations. Appropriations report language notes that counternarcotics, alternativedevelopment, and judicial reform should remain the principal focus of U.S. policy in Colombia. Thisauthority shall cease if the Secretary of State has credible evidence that the Colombian Armed Forcesare not vigorously attempting to restore government authority and respect for human rights in areasunder the effective control of paramilitary and guerrilla organizations.
section_title: Personnel Caps
paragraphs: The FY2005 National Defense Authorization Act changed existing law with regard to the capon the number of U.S. military and civilian contractors that can be deployed in Colombia in supportof Plan Colombia. The cap on military personnel was raised from 400 to 800, and for civiliancontractors, from 400 to 600. As of September 30, 2005, there were 359 U.S. military, and 365 U.S.contractors in Colombia in support of Plan Colombia. During the previous three months, militarypersonnel levels varied between 234 and 460, while civilian personnel levels varied from 345 to392. (16) These numberschange as programs begin, expand, or finish. The personnel caps also do not apply to foreign nationalcontract employees, or to personnel stationed at the U.S. embassy. 
section_title: Helicopters
paragraphs: The FY2006 Foreign Operations Appropriations Act maintains current law requiring that ifany helicopter procured with ACI funds is used to aid or abet the operations of any illegalself-defense group or illegal security cooperative, the helicopter shall be immediately returned to theUnited States.
section_title: Reports
paragraphs: The FY2006 Foreign Operations Appropriations Act requires that the Secretary of State, inconsultation with the Administrator of USAID, provide to the Committees on Appropriations areport within 45 days of enactment and prior to the initial obligation of funds on the proposed usesof all ACI funds on a country-by-country basis for each proposed program, project, or activity. TheFY2005 National Defense Authorization Act requires a report from the Secretary of State within 60days of enactment (in consultation with the Secretary of Defense and the Director of CentralIntelligence) on any relationships between foreign governments with organizations in Colombia thathave been designated foreign terrorist organizations by the United States. The report is to describewhat direct or indirect assistance these groups are receiving and the U.S. policies designed to addresssuch relationships.
section_title: Colombian Human Rights
paragraphs: The FY2006 Foreign Operations Appropriations Act allows the obligation of 75% ofassistance to the Colombian Armed Forces without a determination and certification from theSecretary of State regarding respect for human rights and severing ties with paramilitary groups. Theremaining 25% can be released in two installments of 12.5% each. The first installment can be madeprovided that the Secretary of State certifies that:
the Commander General of the Colombian Armed Forces is suspendingmembers who have been credibly alleged to have committed gross violations of human rights or tohave aided or abetted paramilitary organizations; 
the Colombian government is vigorously investigating and prosecutingmembers of the military who have been credibly alleged to have committed gross violations ofhuman rights or to have aided or abetted paramilitary organizations, and promptly punishing thosefound guilty;
the Colombian Armed Forces have made substantial progress in cooperatingwith civilian prosecutors and judicial authorities in such cases; 
the Colombian Armed Forces have made substantial progress in severing linksto paramilitary organizations; 
the Colombian government is dismantling paramilitary leadership and financialnetworks by arresting commanders and financial backers; and 
the Colombian government is taking effective steps to ensure that land andproperty rights of indigenous communities are not being violated by the Colombian Armed Forces. 
The last installment can be made after July 31, 2006, if the Secretary of State certifies thatthe Colombian Armed Forces are continuing to meet the above conditions and are conductingvigorous operations to restore government authority and respect for human rights in areas under theeffective control of paramilitary and guerrilla organizations. The law also requires that not later than60 days after enactment, and every 90 days thereafter, the Secretary of State shall consult withinternationally recognized human rights organizations regarding progress in meeting theseconditions. 
The law denies visas to anyone who the Secretary of State determines willfully provided anysupport to leftist guerrilla organizations or rightist paramilitaries, or has participated in thecommission of gross violations of human rights in Colombia. The provision may be waived by theSecretary of State determines and certifies, on a case-by-case basis, that the issuance of a visa isnecessary to support the peace process in Colombia, or for urgent humanitarian purposes.
In addition to these provisions that are specific to Colombia, the law includes a provisionfrom previous legislation, often called the Leahy amendment, that denies funds to any unit of asecurity force for which the Secretary of State has credible evidence of gross human rights violations. The Secretary may continue funding if he determines and reports to Congress that the foreigngovernment is taking effective measures to bring the responsible members of these security forcesto justice.
section_title: Funding Earmarks
paragraphs: The FY2006 Foreign Operations Appropriations Act designated that not less than $228.8million of ACI funds be allocated to USAID for alternative development and institution building. Of this amount, USAID is directed to use $131.2 million for programs in Colombia. Bill languagedirects that ACI funds apportioned to USAID shall be allocated by the Administrator of the U.S.Agency for International Development in consultation with the Assistant Secretary of State forInternational Narcotics and Law Enforcement Affairs.
The act also required that not less than $6 million be made available for judicial reformprograms in Colombia and not less than $8 million for programs to protect human rights. It alsoearmarks not less than $2 million for programs to protect biodiversity and indigenous reserves inColombia. Conference report language ( H.Rept. 109-265 ) directs that $500,000 of funds availablefor the Colombian Armed Forces be made available for incidental costs associated with treating inthe United States, soldiers injured by land mines. Report language also recommends additionalassistance through the Leahy War Victims Fund be made available to help Colombian civilians whoare disabled by land mines.
section_title: Aerial Fumigation
paragraphs: The FY2006 Foreign Operations Appropriations Act requires that not more than 20% offunds used for the procurement of chemicals for aerial coca and poppy fumigation be made availableunless the Secretary of State certifies that 1) the herbicide mixture is in accordance with EPA labelrequirements for comparable use in the United States and any additional controls recommended bythe EPA; and 2) the herbicide mixture does not pose unreasonable risks or adverse effects to humansor the environment, including endemic species. Further, the Secretary of State must certify thatcomplaints of harm to health or licit crops caused by fumigation are evaluated and fair compensationis being paid for meritorious claims. These funds may not be made available unless programs arebeing implemented by USAID, the Colombian government, or other organizations, and inconsultation with local communities, to provide alternative sources of income in areas where securitypermits for small-acreage growers whose illicit crops are targeted for fumigation.
section_title: Prohibition on Participation in Combat Operations
paragraphs: The FY2006 Foreign Operations Appropriations Act and the FY2005 National DefenseAuthorization continues the prohibition on U.S. military personnel or U.S. civilian contractorsparticipating in any combat operations in Colombia. This provision has been included inauthorization and appropriation legislation since the original Plan Colombia law approved byCongress in 2000.
section_title: Bolivian Human Rights
paragraphs: The FY2006 Foreign Operations Appropriations Act requires the Secretary of State to certifythat the Bolivian military is respecting human rights, and that civilian judicial authorities areinvestigating and prosecuting, with the military's cooperation, military personnel who have beenimplicated in gross violations of human rights. Such a certification must be issued before any ACIfunds may be made available to the Bolivian military. 
section_title: Demobilization of Illegally Armed Groups in Colombia
paragraphs: The FY2006 Foreign Operations Appropriations Act makes $20 million available in FY2006to assist in the demobilization and disarmament of former members of foreign terrorist organizations(FTOs), if the Secretary of State certifies that:
assistance will be provided only for individuals who have verifiably renouncedand terminated any affiliation or involvement with FTOs, and are meeting all the requirements ofthe Colombia Demobilization program;
the Colombian government is fully cooperating with the United States inextraditing FTO leaders and members who have been indicted in the United States for murder,kidnaping, narcotics trafficking, and other violations of U.S. law;
the Colombian government is implementing a concrete and workableframework for dismantling the organizational structures of FTOs; and
funds will not be used to make cash payments to individuals, and funds willonly be available for any of the following activities: verification, reintegration (including trainingand education), vetting, recovery of assets for reparations for victims, and investigations andprosecutions.
section_title: Maritime Refueling Vessel
paragraphs: The FY2006 Foreign Operations Appropriations Act report language urges theAdministration to include in its FY2007 budget a funding request for a maritime refueling supportvessel that is capable of refueling U.S. and allied vessels engaged in drug interdiction in the easternPacific transit zone.
section_title: Major Legislative Activity in the 109th Congress First Session
subsections: section_title: FY2006 Foreign Operations Appropriations Act
paragraphs: On June 28, 2005, the House passed H.R. 3057 ( H.Rept. 109-152 ) fully fundingthe ACI at $734.5 million. The Senate passed H.R. 3057 on July 20, 2005 ( S.Rept. 109-96 )fully funding the ACI at $734.5 million. Both House and Senate versions included conditions onassistance, similar to current law, regarding human rights, expanded authority for a unifiedcampaign, a prohibition on combat, and the use of U.S.-provided helicopters.
House Provisions. Some House provisionsdiffered from the Senate. The House made ACI funds available until September 30, 2008, ratherthan 2007 as provided by the Senate. The House version did not include several earmarks thatappeared in the Senate bill, including $2 million to protect biodiversity in Colombia's national parksand indigenous reserves, and $8 million for organizations and programs to protect human rights inColombia.
The House did not maintain language from previous years conditioning the funding for aerialspraying in Colombia on a certification from the Secretary of State on the health and environmentaleffects of the herbicide used there. The House also did not maintain FY2005 language requiring thatthe Administrator of USAID, in consultation with the Assistant Secretary of State for InternationalNarcotics and Law Enforcement Affairs, have responsibility for the use of ACI funds that are directlyapportioned to USAID.
House report language stated the expectation that the Appropriations Committee would beconsulted on a follow-up program to Plan Colombia, that will expire at the end of 2005. TheSecretary of State, in consultation with the Secretary of Defense and the Administrator of USAID,is directed to report to the Committee no later than 60 days after enactment on "the future, multi-yearstrategy of the United States assistance program to Colombia." The report is to include all aspectsof current and future assistance, and an explanation of how the Colombian government will assumeresponsibility for maintaining more of Plan Colombia's assets. Report language also expressed theCommittee's concern with the Colombian government's ability to assume the operational andmaintenance functions of Plan Colombia, and required a report from the Secretary of State on whatactions both Defense and State are taking to transfer responsibilities to Colombian nationals that arecurrently being carried out by U.S. contractors.
Report language also noted concern with the increased cost of oil and fuel contributing tohigher U.S. operating costs in Colombia, and expressed the expectation that Colombia oil revenuesbe used to offset some of the increased costs. It directed the Secretary of State to report on the levelsof revenue the Colombian government is devoting to offsetting increased fuel prices borne by theUnited States in its support for Plan Colombia.
The House directed that $5 million in ACI funds be transferred to the State Department'sBureau for Population, Refugees, and Migration for programs benefitting internally displacedpersons in Colombia. The Report also expressed support for alternative development programs inColombia, and that alternative development, with the presence of an official state presence in theform of law enforcement and security, are fundamental to long term peace and security. TheCommittee directed USAID to report back to the Committee with detailed steps the Colombiangovernment is taking to develop a comprehensive rural development strategy.
With regard to Peru, the House report expressed alarm at the Administration's proposed cutto ACI programs in that country. The Committee directed that Peru receive no less than $114million, of which $61 million would be for eradication and interdiction, and $53 million foralternative development and institution building. The additional funding is to come from reductionsin the Air Bridge Denial program and the newly proposed Critical Flight Safety program. The Senateapproved the Administration's request for Peru. The House report expressed support for a pilotproject using voluntary eradication combined with community development projects to promotecooperation with counternarcotics objectives. The Committee urged USAID to work with The FieldMuseum of Chicago on the Cordillera Azul National Park on a project for alternative communitydevelopment and conservation education.
Senate Provisions. For its part, the Senateincluded language not found in the House version. The Senate limited the amount of funds availableto the Colombian Armed Forces and National Police at $287.45 million, and for alternativedevelopment and institution building in Colombia to $149.76 million. The bill also includedlanguage conditioning the release of assistance to Bolivia on the Secretary of State certifying thatthe Bolivian military is respecting human rights and cooperating with human rights investigationsand prosecutions. 
With regard to the demobilization of illegally armed groups in Colombia, the House did notprovide funding for the demobilization process and required that the Committee be consulted priorto any funds being obligated for this purpose. The Senate included bill language making any fundsfor the demobilization process subject to prior consultation and notification to the Committees onAppropriations. Section 6110 of the bill prohibits funds for demobilization unless they are forlimited activities that are determined by the Justice Department to be consistent with U.S.anti-terrorism laws. Additionally, the Secretary of State must certify that Colombian law isconsistent with obligations under the U.S.-Colombia extradition treaty and that Colombia iscontinuing to extradite Colombian citizens in accordance with the treaty. The certification must alsofind that Colombian law provides for the effective investigation, prosecution and punishment ofmembers of foreign terrorist organizations (FTO) charged with gross violations of humanitarian lawand drug trafficking, and that sentence reductions for those members are contingent on a full andtruthful confession of criminal activity, including knowledge of the FTO's structure, financingsources, and illegal assets, and the turnover of those assets. Additionally, the law must conditionsentence reductions for FTO commanders on a cessation of illegal activities of the troops under hiscommand and the turnover of all the group's illegal assets. The law must further provide thatdemobilized fighters will lose all sentence reductions if they are subsequently found to have withheldassets, lied to authorities about their criminal activities, rejoined an FTO, or engaged in new illegalactivities. 
Bill language also required that an inter-agency working group composed of representativesfrom the DEA, Department of Justice, Department of State, Department of Defense has consultedwith local and national Colombian law enforcement and military authorities, representatives fromthe U.N. High Commissioner's Office for Human Rights in Colombia, and representatives ofColombian civil society, and has issued a report to the Committees on Appropriation. The Senatecalled for the report to include whether: the FTO is violating any cease-fire and commitments tostop illegal activities, including drug trafficking, extortion, and violations of internationalhumanitarian law; the FTO's criminal and financial structure is being destroyed and is not regroupingto continue illegal activities; the Colombian government is conducting effective investigations andprosecutions of FTO commanders, and when appropriate, extraditing them to the United States; theColombian government is aggressively trying to locate and confiscate illegal assets of FTOs; and theColombian government is enforcing FTO cease fires by barring individuals who are credibly accusedof crimes in breach of any cease fire from receiving benefits under the demobilization process.
The Senate also included conditions similar to previous years on the aerial fumigationprogram, making the release of 20% of the funds contingent on a certification from the Secretary ofState on the health and environmental safety of the herbicide. Differing from current law, reportlanguage directed the Secretary of State, in consultation with the EPA, and Colombian authorities,to report no later than 180 days after enactment, on the results of an analysis of the proximity ofsmall bodies of water to coca and poppy fields; and of tests to determine the toxicity of the herbicidespray mixture to Colombian amphibians; and to assess the potential impacts of the spray programon threatened species, including those found in Colombia's national parks.
The Senate maintained a provision from previous years requiring the Secretary of State tocertify that human rights conditions have been met prior to the obligation of 25% of assistance forthe Colombian military, and added a provision directing the Secretary of State to consult with theOffice of the U.N. High Commissioner for Human Rights in Colombia and congressionalcommittees prior to making a certification.
In other report language, the Committee approved $21 million provided for the Air BridgeDenial program, and recommended that the program be consolidated under a single aviationoperation and maintenance account. Report language noted that no funding was being provided forthe proposed Critical Flight Safety program, and stated that a lack of oversight of contract costs andexecution related to the acquisition, lease, and operation and maintenance of aircraft has resulted inannual price and program growth of more than 10% from 2001 to 2006.
Report language recommended $90 million for Colombia in FMF funding. The Committeealso expressed concern that the aerial eradication program is falling short of predictions and that cocacultivation is shifting to new areas. The Committee stated its awareness of poverty anddiscrimination faced by Afro-Colombians, and recommended assistance, especially for thoseinternally displaced in the Choco region, through the Afro-Latino Development Alliance. The reportrecommended that $5 million in ACI funds be made available for technology related to themonitoring of web-based communications to combat extortion, kidnaping, narcotics trafficking, andterrorism in Colombia.
Foreign Operations Conference Report. TheHouse passed the conference report ( H.Rept. 109-265 ) on November 4, 2005, and the Senatefollowed suit on November 10. The President signed it into law on November 14, 2005 ( P.L.109-102 ). The agreement fully funds the ACI at $734.5, but provides a different mix on how thatmoney should be spent than did either the House or Senate bills. (See section on CongressionalConditions on Assistance for provisions provided in the final bill.)
The conference report makes ACI funds available until September 30, 2008 as proposed bythe House. It adopted alternative language with regard to demobilization than that provided in theSenate bill, and appropriated $20 million to assist Colombia carry out the demobilization process. (See page 10 of this report for conditions on demobilization assistance.) The conference reportremoved the Senate provision requiring the Secretary of State to consult with the U.N. HighCommissioner for Human Rights in Colombia before making a certification that Colombia ismeeting human rights conditions. Instead, the conference report states the expectation that theSecretary will consider the opinion of the High Commissioner and the Committees onAppropriations prior to making the certification. It also increased funding for alternativedevelopment and rule of law programs in Colombia from $149.76 million, as provided by the Senate,to $158.6 million.
section_title: Foreign Relations Authorization Act, FY2006 and FY2007
paragraphs: The House International Relations Committee reported H.R. 2601 , the ForeignRelations Authorization Act, with a provision making U.S. assistance to Colombia contingent on acertification from the Secretary of State that Colombia has a workable framework in place for thedemobilization and dismantling of former combatants, and that Colombia is cooperating with theUnited States on extradition requests. The bill also calls for a report from the Secretary of State thatdetails tax code enforcement in Colombia. In floor action, the House approved a Burton amendmentto authorize the transfer of two tactical, unpressurized marine patrol aircraft for use by theColombian Navy for interdiction purposes.
The Senate has had under consideration its version of the foreign relations authorization bill, S. 600 . The bill authorizes funding for ACI and includes a number of conditions onassistance consistent with current law. The bill would authorize a unified campaign against narcoticstrafficking and terrorist activities; maintains the existing cap on military and civilian personnelallowed to be stationed in Colombia; prohibits U.S. military and civilian personnel fromparticipating in combat operations; and maintains reporting requirements relating to human rightsand the conduct of U.S. operations. 
section_title: National Defense Authorization Act, FY2006
paragraphs: The FY2006 National Defense Authorization Act ( H.R. 1815 ) was passed bythe House and Senate on December 19, 2005 and signed by the President on January 6, 2006 ( P.L.109-163 ). It authorized $901.7 million for DOD-wide global drug interdiction activities. Unlike theFY2005 authorization, it did not include provisions relating to Colombia or the Andean CounterdrugInitiative.
section_title: Appendix B. Map
paragraphs: Figure 1. Andean Counterdrug Initiative Countries