PERUVIAN COCA STILL ON THE RISE

LIMA, Peru,(Reuters) -- Peru, the world's No. 2 cocaine producer, has
changed tack in its war on drugs, offering farmers cash and job benefits to
eradicate crops voluntarily, but officials admit illicit cultivation still
is on the rise.

Nils Ericsson, the Andean nation's anti-drugs "czar," said on Wednesday Peru
had launched a new campaign offering farmers a decent day's pay to rip up
their cocaine-producing crops, and guaranteeing them jobs in infrastructure
and other projects instead to develop legal economies in the drug
heartlands.

Peru until now had relied on forcible manual -- not chemical -- eradication
of coca leaf, the raw material for cocaine, destroying some 17,300 acres
(7,000 hectares) last year. It hopes to rip up a similar amount this year,
but admits that to start with, only a small part will be done willingly.

Peru's problem is that farmers, disillusioned by low world prices for
alternative crops such as coffee and fruit, are planting fresh coca more
quickly than existing crops are pulled up.

According to the latest official U.S. data, Peru had some 84,016 acres
(34,000 hectares) of coca crops at the end of 2001 -- the United Nations
puts it a bit higher at 114,242 acres (46,232 hectares), while other
Peruvian experts say the total could be 148,263 acres (60,000 hectares).

"As a conservative estimate, it could be 50,000 hectares (123,553 acres)
(this year)," Ericsson said.

But he said the real issue was not how much coca was sown but how
effectively Peru cracked down on illicit cultivation.

Only a small proportion of coca -- which has been chewed for centuries in
the Peruvian highlands to combat altitude sickness -- is sold legally for
uses including tea and, minus any trace of cocaine, as an ingredient in
Coca-Cola.

Peru temporarily halted drug eradication programs in key drug hot spots
several months ago in a dispute over eradication, but Ericsson said all
efforts were now back on track.

Under the new voluntary eradication drive, launched last week, Ericsson said
farmers would be paid 55 soles ($15) a day to pull up their crops, adding
that it takes around 10 work days to eradicate 2.5 acres (1 hectare).

"The point is not to leave a hole in their incomes," he said.

Many dirt-poor farmers say they are forced to grow coca illegally because
nothing else pays a living wage.

Farmers then would be guaranteed a wage for at least six months.

"They're going to have an income deriving from their job in works that favor
the community -- road construction, sanitation works ... school building,"
he added.

"In that time, we would decide with them what we can do for development and
that would start immediately, so there would come a time when work in the
developing zones would replace these transitional jobs," he said.

Ericsson said Peru had garnered some $600 million to $700 million to spend
on drug interdiction, alternative development and prevention projects over
the next five years.

A U.S. aerial drug interdiction program, halted last year after the Peruvian
air force shot down and killed an American missionary and her baby daughter
after mistaking their plane for a drug courier, is expected to restart
before the end of the year.

Ericsson said Peru hoped that private investment in projects and the
furnishing of credits guaranteed by the U.S. Agency for International
Development (USAID) would stimulate legal enterprises instead of drugs.
Officials from USAID were expected in Peru in coming weeks to discuss the
projects.

He said one long-term project being studied by a California-based consortium
was to produce ethanol for use in the U.S. market in jungle areas previously
devoted to drugs.