U.S. ANTI-DRUG STRATEGY STALLS IN THE ANDES

WASHINGTON (Reuters) - U.S. anti-drug strategy in the Andes has stalled as
officials figure out how an American missionary plane was shot down by a
Peruvian Air Force plane and politicians ask why U.S. allies in Peru are
now wanted for corruption.

The State Department this week expanded an inquiry into the downing of the
plane that killed an American woman and her baby in April to a review of
its program to intercept airborne drug shipments in Peru and Colombia.
Interceptions have been suspended.

The shoot-down policy adopted in 1994 was key to cutting off an air bridge
used by traffickers in Peru, once the world's largest producer of cocaine
before Colombia took that role.

As Colombia pushes ahead with a controversial U.S.-funded military and
police offensive against drug plantations, U.S. officials acknowledge there
are signs that coca growing is on the rise again in Peru. Democratic
senators, now in control of the Senate agenda, plan to hold hearings early
this Fall on Andean counterdrug policies, aides said on Thursday. They also
want to look at U.S. ties to Peru's former intelligence chief Vladimiro
Montesinos, now a fugitive accused of crimes including involvement in
massacres, arms and drugs trafficking, money laundering and vote rigging.
Human rights groups had long warned that the United States was turning a
blind eye to human rights abuses in Peru for the sake of advancing its drug
war objectives under president Alberto Fujimori (news - web sites), who was
brought down in November by a series of political scandals surrounding his
spy master, including the running of guns to Colombia's Marxist guerrillas.

Cozy Deal

"I think there was a little cozy deal with the previous government that I
have my suspicions about. I cannot say that with absolute certainty, but
boy there is an awful lot of smoke around," Democratic Connecticut Sen.
Chris Dodd told Reuters.

Dodd said he has held private talks with other senators about holding a
hearing on U.S. links to Montesinos.

"The U.S. was allied with Montesinos for counternarcotics purposes and it
turns out that he may have been controlling the drug trade in Peru," said
Gina Amatangelo, an expert at the independent Washington Office on Latin
America. Amatangelo said it was not the first time that a U.S. ally was
found to be involved in the drug trade, pointing to former Panamanian
dictator Manuel Noriega, who like Montesinos once was an informant of the
Central Intelligence Agency (news - web sites) (CIA (news - web sites)).
U.S. forces invaded Panama in 1989 to overthrow Noriega, who is now serving
30 years in a Florida high-security jail for drug trafficking. The Clinton
administration conducted a review of its ties to Montesinos in the
mid-1990s, but decided that his role in providing Peruvian cooperation in
the drug war was too vital, a former official said.

Eyes Wide Open

"It was not a matter of turning a blind eye. It was more troubling than
that. It was eyes wide open to the good and the bad," a former Clinton
administration official told Reuters.

"It was so patently clear that what Fujimori and Montesinos were doing
undermined democracy in Peru," he added.

When Fujimori sought an unprecedented third term last year, U.S. officials
knew the vote was rigged by Montesinos.

"That was all engineered by Montesinos. Everyone knew that. It was no
secret," the former official said.

Washington brought international pressure to bear on Fujimori that
contributed to his downfall. But there had been constant run ins between
the CIA and the National Security Council and the State Department over
Peru, he said. "There was friction between the NSC and the CIA, between the
drug czar's office and the NSC, between the Pentagon (news - web sites) and
State, and within the embassy in Lima," the official said.

No Alternative

Despite rumors that he was corrupt, the CIA and other U.S. government
agencies maintain they had to work with Montesinos because he was the
equivalent of national security advisor and head of Peru's intelligence
service at the time.

"The U.S. government by necessity had to deal with him," a U.S.
intelligence official told Reuters.

Under Fujimori, the Peruvian government defeated Maoist and Marxist
guerrilla groups and succeeded in reducing coca leaf cultivation by 70 per
cent in five years. Fujimori fled to Japan and is wanted in Peru to stand
trial for corruption.

Clinton's drug policy director Gen. Barry McCaffrey admits Montesinos was a
"dangerous character" responsible for the "corruption and authoritarianism"
of Fujimori's government.

The shadowy Montesinos infuriated McCaffrey in 1998 by doctoring a video
tape of their meeting to show Peruvians that he was on good terms with the
U.S. drug czar.

But McCaffrey insisted: "Montesinos was a Peruvian creature, not a U.S.
creature."