Colombia's FARC Moves to Consolidate Control

One of the largest mass-kidnappings in Colombian history turned out to be an exaggeration. The governor of Colombia’s Choco department, claimed the Revolutionary Armed Forces of Colombia, also known as the FARC, had kidnapped 170 rural workers on 13 July. Ten more were reported killed. Colombian president Alvaro Uribe deployed a mobile battalion of the Colombian military, whose commander immediately refuted the reports, claiming that no more than 35 rural workers actually had been kidnapped.

The exaggeration of a very real event may reveal the level of desperation some Colombian governors feel as they await their share of the promised deployment of 40,000 rural police officers. Such an incident in one of Colombia’s most isolated outposts also verifies that security gaps are growing all over Colombia. Slow implementation of political promises and the very real absence of the paramilitaries widen these gaps every day. But that is to be expected.

The FARC has not captured all areas left available by the paramilitaries, but it has moved to take over strategically important areas. Choco is at the top of the list.

The department of Choco has been of strategic importance to both the FARC and the paramilitaries as long as both groups have been involved in the drug trade. Colombia shares some 266 kilometers of a border with Panama, all of which is in the Choco department. This area is also the shortest distance from the Pacific to the Caribbean and is replete with river systems that facilitate transport.

Riosucio is a small town on the Truando River, part of a fluvial system that stretches from the mountains in north-central Choco to the Caribbean. This area is in the center of the current conflict between the 57th FARC Front and a paramilitary unit due to disarm at any time, according to Colombian reports.

The FARC is already moving in. They have taken hostages and even killed those who they thought were paramilitary sympathizers. The events of 13 July point out that the FARC is moving in to take over as much of the northern portion of the Choco department as possible, despite any plans the Colombian government has for increased rural security.

Over the duration of his first administration, President Uribe went on the offensive, seeking out conflict with the FARC. Since 2003, Uribe has installed 84 new rural police substations. He oversaw the development of seven new military brigades and 54 mobile squadrons. He started the so-called “public forces,” empowering citizens to join a sweeping intelligence network. His capstone offensive, called “Plan Patriota,” continues to take the fight to the FARC strongholds in southern Colombia.

Uribe’s next move, his promised 40,000 rural police, will be even more invasive into FARC satellite territory. His government will install 400 new substations, according to the Colombian daily El Tiempo. Half of the rural police, some 20,000 in number, will be agents with anti-guerrilla training. A total of 15 anti-terrorist special forces will be deployed in Colombian cities.

Yet for all the muscle, Uribe has put into his so-called Democratic Security program, the FARC continues to thrive, all but securing a corridor to Ecuador by controlling the departments of Putamayo and Narino. Through this corridor the FARC receives supplies and its members escape into Ecuadorian territory when chased by the Colombian military.

The FARC is currently consolidating control of Aruca, a Colombian department that shares a border with Venezuela. Many analysts believe control of this area will open a significant corridor for export of cocaine through Venezuela, one facilitated by the Venezuelan National Guard.

The Dog’s Head area, where the Colombian department of Vaupes meets the Brazilian Amazon, has been a long-time FARC strong hold. Neither Brazilian nor Colombian authorities have managed to stymie the number of clandestine airstrips in this area, nor the flow of trade between Brazilian organized crime, based in Rio de Janeiro, and the FARC. The packages used to transport 250 kilograms of pure cocaine, interdicted outside Rio de Janeiro, Brazil in mid-July, bore the distinct FARC signature. This bust indicates that the old alliance between the Brazilian Fernando Beira-Mar and the FARC, propagated by transport routes used in the Amazons, is alive and well.

Colombia’s Black River eventually joins with the Amazon River’s upstream network in Brazil. It flows south through the Colombian department of Amazonas to the town of Leticia, into Tabatinga, Brazil. Tabatinga is a known meeting place where FARC operatives hand over cocaine, and Brazilian criminals deliver weapons and ammunition.

By most counts, it appears that Uribe’s security initiatives have worked well to secure the center of Colombia, the core areas where Colombians live and work, yet the rest of the country, the perimeter, in particular, remains ungoverned. Uribe may have succeeded in delivering security to many Colombians, but he has done very little to actually put a dent in the FARC’s wide spectrum of illicit activity.

It is quite possible that in the next year the FARC will have taken complete control of trafficking corridors through Panama, Ecuador, Venezuela and Brazil. If the United Self-Defense Forces of Colombia (AUC) continue to disarm, as planned, there will be relatively little resistance, by way of irregular security units, in Colombia’s perimeter areas.

The recent incident in Choco is just one more bullet point on a long list of upcoming conflicts.

Uribe’s plan to install another 40,000 rural police around the country is a great idea. It has raised the hopes of governors. But one, in particular, seems to have become a bit more nervous. His outcry of 170 kidnap victims got the world’s attention. Yet there was little anyone could do. The FARC made its presence known, and the addition of one rural police substation in Riosucio would not have made a difference...

You will find the audio link here.

Sam Logan is an investigative journalist who has reported on security, energy, politics, economics, organized crime, terrorism, and black markets in Latin America since 1999. He is currently completing his work on “Nice Guys Die First,” a forthcoming non-fiction narrative about organized crime in Brazil.

Post-World Cup Regional Roundup

As always, you may listen to this podcast here.

For today’s show I would like to share with you a basket of developments around the region from Mexico to Argentina, starting north and working my way south.

We are into the second week after Mexico’s July 2 elections and still presidential candidate Andres Manuel Lopez Obrador contests the results. He trailed Mexican president-elect Felipe Calderon by one-half point in the first count of votes. Obredor has stated publicly that Mexicans will take to the streets unless he’s satisfied with a recount.

Today, the 12^th of July, Mexicans have already taken to the streets, focusing on Mexico City’s central square. It could be the beginning of a nation-wide protest. And still I wonder, why are Mexican politicians not paying closer attention to the power of organized crime there?

Further to the south, in Nicaragua, one presidential candidate has died, which is likely to hand votes to former president and Sandista leader, Daniel Ortega. If Ortega wins, expect Nicaragua to take a sharp turn from a pro-United States posture. Venezuelan president, Hugo Chavez has been sowing seeds of support in both Nicaragua and Mexico. As president of Nicaragua, Ortega would likely begin to close ties between the Central American country and Venezuela, starting with more oil.

Meanwhile, Colombia and Venezuela started construction on a gas pipeline between the two countries on the 9^th of July. This is the first segment of a gas pipeline Chavez would like to extend to Panama.

With a terminal for Venezuelan gas in Panama, Chavez would likely begin selling more to China and his Central American counterparts. China, by the way, has upped their crude oil purchases from Venezuela from 168,000 barrels a day to 300,000 – a 45 percent increase. Between now and 2012, PDVSA expects to increase output by two million barrels a day. There are indications that much of this oil would go to China, but the East coast of the United States remains Venezuela’s top destination of oil products.

In Bolivia, president Evo Morales has realized the limitations of his power. The results of the vote to elect members to Bolivia’s upcoming Constituent Assembly did not give Morales’ political party the majority needed to enshrine its ideology into Bolivia’s new constitution. Morales’ party, MAS, won some 53% percent of the vote, while Jorge Quiroga’s party, Podemos, won some 23%. This means Morales will need to negotiate with Quiroga to reach consensus. This fact stifles any opportunity Morales may think he has to enact sweeping change in Bolivia.

Next door in Brazil, we are coming close to elections, scheduled for October, 6. Brazilian president Luis Inacio da Silva, better known as simply Lula, still holds the lead in polls over Alckmin. In the latest poll released, on Tuesday, the 12^th of July, the race has tightened. Lula’s lead has slipped from 22.4 percentage points to 16.9 points. Still, if the election were held today, Lula would win with 44.1% percent of the vote, while his top competition, Geraldo Alckmin, Sao Paulo’s former governor, would take some 27.2 percent of the vote. Yet 50% of Brazilian voters are still undecided.

A factor that may hurt Alckmin in the future is the continued violence in his home state of Sao Paulo. When Alckmin began campaigning some months ago, he stood on two pillars – increased security and economic improvement. Under Alckmin, Sao Paulo saw both. He claims he can do the same for the nation. Yet as many of you probably know, Sao Paulo has had some trouble with prison riots, gang members attacking police stations, and cops retaliating with brutal force, sometimes excessive if you ask human rights advocates.

On the 11t^h of July, a third round of attacks, 38 in all, targeted police stations, buses, and empty banks. These attacks, organized by the First Capital Command, known as PCC in Portuguese continue to erode away at Alckmin’s security record. I have to wonder if that will translate to votes. If Lula wins what can he do to improve security in Sao Paulo? Not much.

As we’ve seen today, Lula has again offered federal help, but that help must be accepted by the governor of Sao Paulo. So far is hasn’t, and as long as the governor of Sao Paulo does not support the president, there will be a power struggle. The same is true for the state of Rio de Janeiro. I wonder if this is part of the reason why both of these states have a serious problem with organized crime.

In the Southern Cone, Argentina has seen a rise in crack use. It has doubled between 2001 and 2005. One dose of one gram costs one peso, or 32 cents. It’s hard to think of something that’s as cheap as 32 cents. You can’t even buy one can of coke for that amount anymore. The development that has led to this rise in crack use is cocaine cooking in Argentina. Argentine drug dealers years ago began to purchase coca paste from Bolivian connections so they could cook the cocaine in houses closer to the major market in Buenos Aires.

Cooking the cocaine yourself removes a handful of middle men. Past is less risky to transport, and once the cocaine is cooked, high purity levels ensure good sales. The side effect, of course, is also a constant supply of crack. To my knowledge, Argentine president Nestor Kirchner has not made a public statement concerning his country’s security challenges or rise in drug use.

Elections and leadership in Peru, Brazil, Venezuela, and Argentina

Today’s show presents an interview with Michael Shifter, who is vice-president for policy with the Inter-American dialogue, a Washington, DC-based policy analysis think tank for Western Hemisphere affairs. Mr. Shifter is also a professor of Latin American politics with Georgetown University in Washington. He has lived in Lima, Peru and Santiago, Chile.

Following up on Mr. Shifter’s recent interview with Peruvian president-elect, Alan Garcia, I began our interview by asking about Garcia’s plans for Peru. We also touched on issues of Peruvian relations with Brazil, Chavez’s strategy for the upcoming presidential elections in Venezuela, and the possibility of former Argentine economic minister Roberto Lavagna.

You can find the MP3 here.

The Kalashnikov Threat in Venezuela

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...Venezuelan President Hugo Chavez announced on 30 May that the first shipment of 30,000 AK-103 assault rifles would arrive in Venezuela by the end of June. On the same day, Alexander Badistan, spokesman for the Russian arms manufacturer Rosoboronexport, said the company would grant Venezuela a license to manufacture AK-103 rifles. Chavez’s statement confirmed that claim. “The Russians are going to install a Kalashnikov rifle plant and a munitions factory so we can defend every street, every hill, every corner,” he said.

The 30,000 rifles that are due to arrive in Venezuela are part of a larger arms build-up that has caught the attention of US and South American leaders. Yet for all the media coverage of new fighter jets and submarines from Russia, patrol boats from Spain, and the specter of ballistic missiles from North Korea, a threat that has been overlooked has become more serious.

The Venezuelan military does not employ strict control over its stockpile of small arms and light weapons and ammunition for those weapons. According to the Federation of American Scientists (FAS), 400 of the 9,380 rifles seized from illegal groups in Colombia from 1995 to 2000 bear the symbol of the Venezuelan Armed Forces.

The US-based RAND Corporation think tank claims that there were at least 21 known arms trafficking routes between Venezuela and Colombia in 2003. Reports from Jane’s Information Group claim that members of the Venezuelan Armed Forces continue to smuggle into Colombia small numbers of Venezuela’s old FAL rifles.

An AK-103 rifle factory based in Venezuela could add hundreds of thousands of guns to Venezuela’s poorly controlled weapons stockpile.

Meanwhile, Transparency International ranked Venezuela in its 2005 Corruption Perceptions Index as the third most corrupt nation in Latin America, more “honest” than Paraguay and Haiti.

Rampant corruption, combined with strong ties between some Venezuelan security officials and leftist rebels from the Revolutionary Armed Forces of Colombia (FARC), creates a scenario that places Venezuela in the center of a region-wide black market. Adding hundreds of thousands of assault rifles creates a temptation for Venezuelan criminals to sell those weapons on the black market, creating a region-wide security threat.

Central America has traditionally served as a reliable source of black market weapons for the FARC. Paraguay and Brazil are also known resources for weapons, ammunition, and other materials. Venezuela has been seen as a major transit country, and not high on the list of source countries for arms flowing into Colombia. A new weapons factory there may change that fact.
Corruption helps create and maintain all sources of black market weapons. And as governance becomes less a priority in Venezuela, impunity and corruption develop into norms.

Billions of dollars, dog eared for government programs, have simply disappeared, most likely siphoned-off by corrupt officials, according to Gustavo Coronel, a former member of PDVSA state-owned energy giant's board of directors who now monitors corruption in the Chavez government. Coronel claims that social programs such as Plan Bolivar 2000, and its replacement program, The Centralized Social Fund, are defunct and run by military officers who have little to no oversight.

It has become clear that leaders of Venezuela’s military, as long as they remain loyal to Chavez, receive no oversight from Caracas. Venezuela cannot offer any reasonable assurances that AK rifles purchased from Russia or manufactured in Venezuela will not leak into the hands of the FARC or other extra-legal groups in the region.

In the meantime, Chavez continues to spend billions on planes, boats, submarines, and helicopters, claiming the Venezuelan military needs a facelift. While this may be true, the more important matter lies with Chavez’s new batch of AK-103 rifles, and those that follow. Fighter jets, submarines, and patrol boats are all part of a conventional army, quickly rendered useless by an opponent's missiles. Considering Chavez’s adherence to guerilla warfare and the success asymmetrical warfare has had in the recent past, AK rifles are much more of a threat than any attack helicopter or fighter jet.

True Power Behind Organized Crime in Brazil

(Note, this piece has been modified from its original form, first published by the Power and Interest News Report.)

Only the MP3 version includes extra comments and analysis. If you want to listen to this post, please download the file here. Otherwise, please keep reading...

...The violence that paralyzed Sao Paulo from May 12 until May 20 revealed the raw power of the First Capital Command (P.C.C. in Portuguese), considered one of the most powerful organized criminal factions in Brazil. Prison riots that erupted in nearly 100 prisons led to over 150 murders, destroyed city buses, and terrorized millions of citizens, propelling Brazil onto the world stage. Yet a more deeply-rooted system run by the P.C.C. reveals how powerful this gang has become.

On May 10, just two days before the riots began, two members of the Sao Paulo Department of Investigation of Organized Crime, Missers Bittencourt and Ferraz, testified before the Brazilian Government Inquiry Commission on the Traffic of Illegal Weapons about their understanding of the true power of the P.C.C.

Bittencourt and Ferraz testified that the P.C.C. is a very serious problem that is only growing. They blamed Sao Paulo authorities for separating and sending to other Brazilian states various leaders of the P.C.C. by pointing out that because of this separation, the P.C.C. now has a strong presence on a national level in Matto Grosso do Sul, Paraná, Bahia, Rio Grande do Sul, and Brasilia.

According to Bittencourt and Ferraz, the P.C.C. controls over 140,000 prisoners in the state of Sao Paulo alone. Another 500,000 individuals support the organization outside the prison system. This group helps enforce some 100 cases of extortion organized by the P.C.C. on a daily basis, representing some 70 percent of kidnapping cases in Brazil's financial capital of Sao Paulo.

Apart from a proven ability to organize simultaneous, widespread prison riots and destabilize public security, the organization has constructed a network of informants, lawyers, blue collar workers, gun and drug dealers, and bankers to do its bidding. This network is held together by a criminal financial system that finances education, facilitates crime and engages in killings. Bittencourt was quoted as saying, "to be [associated] with the P.C.C. is good business."

Membership fees are the bread and butter of the P.C.C. For prisoners, a fee of 25 dollars is charged every month. Individuals on the outside pay a fee of 225 dollars Given these fees and the high membership numbers both inside and outside the prison system, it is possible that the P.C.C. organization earns millions of dollars a month from fees alone.

Criminal finance is another revenue stream. If a group needs $10,000 to mount a bank robbery, they can go to the P.C.C. In this case, the P.C.C. acts as a black market bank to finance and facilitate criminal activities.

To distribute weapons, the P.C.C. uses Sedex, a Brazilian courier system known for reliability and timely delivery. Weapons as large as assault rifles have allegedly been delivered by Sedex to the waiting hands of criminals.

The P.C.C.'s weakest link is its legal team. Currently 18 lawyers serve the P.C.C. leadership, according to Bittencourt. They oversee dozens of legal cases against P.C.C. members and make regular visits to P.C.C. leaders imprisoned around the country. Brazilian law protects the lawyer-client relationship to extremes. Prison authorities are not allowed to search lawyers when they enter the prison to visit their clients. Many believe that the lawyers bring cell phones, two-way radios, laptops, and other critical tools the P.C.C. needs to keep its criminal system running.

Reaching beyond its current legal team, the P.C.C. supports law students, paying full tuition in exchange for services once they have a law degree. The P.C.C.'s educational funding extends to future politicians and other individuals who indicate an interest in entering Brazil's political world. The group also facilitates the path for students who want to enter public security. These efforts and more act as a well-planned insurance policy to ensure the continued existence of the P.C.C. through the manipulation of Brazil's judicial, political, and security systems.

It was the manipulation of Brazil's political system that led to the purchase of the testimony Bittencourt and Ferraz prepared for their audience. For some $100, the PCC purchased the testimony from an employee of a company contracted to record and transcribe congressional hearings. The material was allegedly purchased by a P.C.C. lawyer, who delivered the information to the P.C.C. leadership.

Also documented in this material was Bittencourt's decision to move on May 12 P.C.C. leaders to more secure prisons to prevent what they had learned would be widespread prison rioting on May 14. The P.C.C. once again proved their superior intelligence networks when they began the riots two days early, leading to a week long struggle to bring peace and rule of law back to Sao Paulo.

As a criminal enterprise, the P.C.C. took life inside a Sao Paulo prison in 1993 when prisoners grouped together to force the improvement of their living conditions. Since then, many prisoners, their family members, and other poor Brazilians idolize the P.C.C. as an armed faction of Brazil's extreme left political flank, working to improve the rights and lives of impoverished Brazilians. For this reason, the P.C.C. draws many of its young recruits from the shantytowns surrounding Sao Paulo.

Many of the people in these communities believe the P.C.C. speaks for them when it fights against what they perceive as a deeply corrupt political organization, beleaguered by broken judicial and penitentiary systems that support an oppressive security structure.

A great irony is many Brazilians believe the P.C.C. fights for them against a government that they consider the true oppressor. At the same time, the P.C.C. has demonstrated a level of power that can only be achieved by taking advantage of the loopholes and cracks in various democratic institutions that today in Brazil appear to facilitate organized crime more than protect and serve Brazilian citizens. What happened in the second week of May 2006 is a minor showing of the true power the P.C.C. holds. It is a level of sophistication and organization that the international media have not been able to elucidate and that people in Brazil would rather not talk about.

Sam Logan (www.samuellogan.com) is an investigative journalist who has reported on security, energy, politics, economics, organized crime, terrorism, and black markets in Latin America since 1999. He is currently completing his work on Nice Guys Die First, a forthcoming non-fiction narrative about organized crime in Brazil.

Morales Sides with Chavez, Takes On Brazil with Energy Nationalization

(Note: This piece has been modified from its original form, first published by the Power and Interest News Report.)

Only the MP3 version includes extra comments and analysis. If you want to this post, please download the file here. Otherwise, please keep reading...

...Evo Morales propelled Bolivia into South America's geopolitical spotlight when he announced on May 1 the nationalization of Bolivia's energy assets. The timing of his announcement did not come as a surprise. Morales displayed a flair of authority by announcing nationalization by presidential decree and using the Bolivian military to implement his long-time promise. His first significant geopolitical move as president of Bolivia left regional leaders concerned about the future of their gas supply.

Evo Morales spent the last weekend of April in Havana. The following Monday, he nationalized Bolivian energy assets, timing that led many to believe Morales has made his choice to position Bolivia into an axis of political power, trade preferences, and energy integration led by Hugo Chavez. Chavez met with Morales on May 3, and arrived at the May 4 summit arm-in-arm with Morales to discuss matters of energy supply that in truth had little to do with Venezuela.

Brazilian President Luiz Inacio Lula da Silva immediately called for a summit to be held just three days after Morales' announcement to exercise his regional leadership role and provide a diplomatic arena for private discussion and a public display of solidarity with Bolivia. Yet, by the morning of May 2, Lula was already feeling the pressure from members of his own party that argued Morales' move underlined a weakness in Lula's diplomatic efforts to keep Bolivia close and protect Brazil's supply of natural gas.

Argentine President Nestor Kirchner, like Lula, is worried about an increase in prices. Kirchner's government subsidizes gas sold to the domestic market in Argentina. An increase in price would force Kirchner to further subsidize the price of gas, meaning a sharp reduction in funds available for federal spending leading up to his reelection bid. Kirchner could also raise the price of gas, but this policy would run against his populist momentum, leaving him vulnerable to political opponents looking for another reason to demystify Argentina's popular president before elections. Kirchner attended the mini-summit to table a plea for low prices.

Chavez's presence at the meeting was no accident. He provided political muscle in support of Morales' announcement. Lula likely took an opportunity to share words with Chavez about what many Brazilian politicians consider two-faced diplomacy. On one hand, Chavez has been promoting a transnational pipeline that would penetrate Bolivia's two gas markets. On the other hand, Chavez has put heavy rhetorical support behind Morales' nationalization moves, putting Brazil's energy future at risk. Chavez's astute diplomacy put Lula in a bind and helped buoy Morales' popular support at home.

At current production and export levels, Bolivia has 70 years' worth of natural gas reserves, according to the Cambridge Energy Research Associates (SERA). SERA research reveals that at year-end 2004, Bolivia's proven gas reserves stood at 26.7 trillion cubic feet (Tcf); proven and probable reserves increase that number to 48.7 Tcf. Bolivia exported 735 million cubic feet of gas (MMcf) per day to Brazil in 2004. In 2006, Bolivia is expected to export some 1,200 million cubic feet of gas per day to Brazil, possibly up to 1,350 million cubic feet of gas per day in 2008 if current pipeline networks are expanded.

In the wake of Morales' May 1 announcement, this may change. Petrobras president, José Sérgio Gabrielli announced on May 3 that Petrobras would freeze all investments in Bolivia, including the expansion of the pipeline that moves gas from Bolivia to Brazilian markets. Gabrielli stated that Petrobras would not accept an increase in prices, citing a contract good through 2019. If prices are increased for Petrobras, the company will seek international arbitrage, he said.

Gabrielli knows he is in a well-leveraged position. Petrobras has invested more than a billion dollars in Bolivia in the last decade. The company's Bolivian subsidiary, Petrobras Bolivia, started operations in 1996. In less than ten years, the company has become responsible for 57 percent of overall natural gas production; it is responsible for 98 percent of the refinement of Bolivia's natural gas, corresponding to some 25 percent of the production of combustibles and some 63 percent of lubricants. These products are sold through a network of 100 Petrobras gas stations, one fourth of all gas stations in the country.

Additionally, Petrobras Bolivia is the largest company in Bolivia, responsible for 20 percent of Bolivian G.D.P. It employs over 850 Bolivians and represented some US$563 million of state revenue in 2005.

Revenue generated from hydrocarbon exports to Brazil and Argentina, Bolivia's two major export markets, represented some 38 percent of total export income in 2004. Losing companies such as Petrobras and Repsol YPF would be damaging to Bolivia's economy. Additionally, Morales knows he needs foreign investment to maintain and improve upon the country's gas export infrastructure. New pumping stations, pipeline networks, and development of other gas-based products are essential to take advantage of Bolivia's energy assets still underground.

A day before the May 4 mini-summit, Lula stated that Brazil has become overly dependent on Bolivian gas. He also said he accepted Morales' announcement and thinks that it is a fair play for Bolivians, despite the losses it may mean for Petrobras Bolivia. Upon the conclusion of the summit, it was clear that the negotiation of prices had not even begun. Morales did state gas exports to Argentina and Brazil would not be interrupted. Gabrielli noted that with the mini-summit out of the way, the table was set for more technical discussions concerning prices and what Bolivia's nationalization of its energy assets really means for energy companies in Bolivia.

Beyond the ramifications of private-sector interests, a regional shift of alliances has begun to form, revealing to all that Bolivia, under Morales, has gravitated toward Venezuela's more nationalist policies, away from Brazil, which under Lula is considered the region's center of geopolitical gravity.

This may be a blow to Lula as a regional leader, but not to Brazil as a consumer of natural gas. Brazil imports some 40 percent of its natural gas supply, mostly from Bolivia. Yet Petrobras has already begun making the necessary investments in development and pipeline infrastructure to reduce this dependency. For Argentina, Kirchner's only worry is price, yet he is already working on other sources of natural gas, mainly through increased deep water production efforts.

Despite who wins the October presidential elections in Brazil, Brasilia will move toward securing its natural gas resources. There is talk of re-gasification plants, which would receive liquid natural gas from Trinidad and Tobago. Nuclear energy, hydroplants, and even bio-energy will continue to meet Brazil's energy needs, placing downward pressure on the demand for natural gas.

If Morales is moving closer to Chavez, he would do well to develop Venezuela as an export market. Any pipeline from Bolivia to Venezuela, however, would need to involve another country. To the west, Bolivia may look to Chile. Many believe that Morales and Chilean President Michelle Bachelet have been talking about a gas-for-Pacific deal for over a year.

Chile's need for natural gas will only grow as Argentina struggles with Bolivia's price increases and national demand that paces ahead of domestic supply. A pipeline that opens Bolivian natural gas to a Pacific port would be mutually beneficial to both Bolivia and Chile, yet historical tension and petty politics may scuttle economic prudence. Chile will likely rely more on a planned liquid natural gas port.

In the short-term, Morales may have put himself and Bolivia in an excellent position. However, his abrupt move to nationalize Bolivia's energy assets by decree and with military force has further convinced Bolivia's two export markets, Brazil and Argentina, that they must become more independent. This trend may reduce Argentine and Brazilian dependence on Bolivian gas in the mid- to long-term. Morales has taken a step in the direction of political assertion and Bolivian self-fulfillment as a regional player. What remains now is the follow-through necessary to secure Bolivia's nationalization of energy assets without isolating the country from her only natural gas customers.

Invasion or War for Venezuela?

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...For years, Venezuelan President Hugo Chavez has claimed to be protecting his people from the corrupt and greedy Venezuelan elite class, represented by the Venezuelan political opposition. Now he is protecting them from an external foe, the US, which he has accused of intending to invade Venezuela. Riding on the rhetoric of an eventual US invasion, Chavez is building up a massive civilian militia answerable directly, and only, to him. That militia, however, is more likely intended to deter a military coup than a US invasion.

After the 2002 attempt to overthrow his government, Chavez changed tactics, taking on a larger role as protector of his people from the US. As such, he must continue to claim that the US will someday invade Venezuela and that they only thing that will keep the Yankees at bay is two million trained civilians.

The formation of a civilian militia gives physical presence and weight to Chavez's rhetoric that the US will one day invade. Considering the many rumors of a palace coup and the shuffling of military commanders in Chavez’s top brass, however, the formation of a civilian militia looks more like another bulwark intended to protect himself against a military-led coup d’etat.
The only conventional army likely to threaten Chavez is Venezuela’s own military forces, the FAN. In the event of a successful FAN-orchestrated coup, two million hardcore supporters with military training could be ordered to drag the country into a civil war. Given the world’s dependence on Venezuelan oil, such a possibility would have serious international repercussions.

Chavez-controlled Militia

The first week of March saw the beginning of a two million-strong reservists’ program, which Chavez has been talking about for years and officially announced on 14 April last year.
Lieutenant Colonel Antonio Benavides is in charge of training the instructors, who will in turn train the reservists. He has emphasized the art of guerrilla warfare. In an interview with the BBC, Benavides lined up a group of civilians to demonstrate the art of surprise in guerrilla warfare. “On the surface they look like ordinary people on the street. But if you look underneath their jackets, you will see they are hiding knives, catapults, and pistols,” the BBC quoted him as saying to an audience at the training grounds.

Taking lessons from the Viet Cong and the Cuban Revolution, Benavides will train officers to teach a volunteer militia how to conduct urban guerrilla warfare. The civilian militia adheres to the doctrine of asymmetrical warfare.

Harnessing a large force of militarily trained civilians to a doctrine of guerrilla warfare has many of Venezuela’s older generals confused because it is a doctrine not espoused by the FAN, nor is it a doctrine Chavez himself was trained when rising through the ranks of the Venezuelan military.
In training and military doctrine, the civilian militia will be completely separate from Venezuela’s traditional military rank and file. Additionally, the militia is not part of the traditional chain of command. Its leaders report directly to Chavez and no one else.

Since Chavez has made public his plans for a civilian militia that he controls, some of his loyalists in the military have expressed concern at this circumvention of the traditional chain of command. Perhaps knowing that his civilian militia announcement would provoke ire, Chavez made some command structure changes to protect his back with hardcore supporters.

Colonel Cliver Antonio Alcala Cordones, for one, would not hesitate to carry out presidential orders to use lethal force against military rebels or civilian dissidents, argue analysts with the US-based private intelligence company StratFor. Alcala is currently the commander of the elite presidential honor guard, tasked with protecting Chavez’s life.

Another hardcore Chavez supporter, Major General Ali de Jesus Uzcategui Duque, has been given command over the country’s internal defense strategy, called Plan Republica, according to StratFor. This plan has a Caracas metropolitan area element called Plan Avila. In the event of a military rebellion or civilian uprising, Plan Avila would be initiated to protect the palace, prominent public services buildings, and the oil infrastructure. General Uzcategui also has the authority to impede any military orders or actions the president finds disagreeable.

Analysts argue that by placing these men in their current positions, Chavez is working to defend himself from the possibility of an assassination attempt by a close personal aide or a military rebellion led by an officer in command of the country’s best-trained soldiers.

Rumors of a coup attempt

When Chavez talks about territorial invasion, he implies that an outside aggressor would invade Venezuela to capture control of the country’s energy assets. Since the coup in 2002, Chavez has focused his rhetoric on the eventual invasion of US military forces. He has repeated his belief that the US would invade so often that US ambassador to Venezuela, William Brownfield, said in April last year that “the United States has never invaded, is not invading at this moment, and will never invade Venezuela”.

But Chavez doubts the sincerity.

A string of events that points to plans to overthrow Chavez contribute to his paranoia.
When Chavez announced in April last year that the planned civilian militia force would be under his direct control, reports at the time indicated that FAN ranking commander General Raul Baudel strongly objected to the unilateral decision to control what would become a considerable force of trained and armed Chavez supporters.

Chavez made his announcement during a ceremony to commemorate the second anniversary of a failed attempt to overthrow his government. The message to his enemies was quite clear.
Almost two months after the announcement, Venezuelan Vice President Jose Vicente Rangel announced that the government suspected the political opposition was planning a military coup. Two days prior to that announcement, Venezuelan Defense Minister General Jorge Garcia Carneiro said that pamphlets urging a military revolt against Chavez had been circulated in various military installations around the country.

Not a month later, opposition leader Andres Velasquez, announced that Chavez had decided to postpone a military parade because he believed it would be the stage for an attempt on his life. FAN Commander General Baudel said there was no intelligence to back up such claims. However, Chavez claimed he had intelligence that pointed to an assassination attempt on 24 June, the day of the parade.

The day before the parade, General Melvin Lopez Hidalgo, a member of Venezuela’s National Defense Council, confirmed that an officer had been arrested at Fort Tiuna at the FAN’s Third Army Division base in Caracas. It remains unclear if the arrested officer was connected to the alleged assassination attempts or the anonymous pamphlets.

Audio tapes that allegedly contained details of a planned military coup surfaced in early December. Nicolas Maduro, chairman of Venezuela’s National Assembly and member of the Fifth Republic Movement party, presented the tapes to the National Assembly on 8 December. They allegedly contain a conversation among retired army officers, who were plotting to overthrow Chavez’s government by blowing up oil infrastructure before taking over military headquarters.

Asymmetrical warfare

What military analysts call asymmetrical warfare, also referred to as fourth-generation warfare, is characterized by war between a nation-state and a non-state actor. Latin America’s history is riddled with examples of how asymmetrical warfare has been used to overthrow a government, such as the Cuban Revolution, or used to prolong a struggle, such as the Revolutionary Armed Forces of Colombia (FARC).

In some cases, these non-state actors have been integrated into politics, such as the FLMN in El Salvador. Chavez is in a position to take advantage of this history to promote his ideology of a region-wide resistance against US imperialism. It is convenient rhetoric that veils what many believe are his intentions to deter a military coup.

By the end of 2007, it is quite possible that a total of two million Chavez supporters will have been trained and reinserted back into their normal lives, ready to resist at a moment’s notice. It is highly unlikely that this militia will be called to protect Venezuela from an outside invader.
Rather, they could be called on to protect Chavez’s regime from a cadre of military officers and others who want to remove him from office. If Chavez manages to survive such a coup attempt, he may go quietly or he may seek to embody the spirit of Cuba’s Fidel Castro and regional revolutionary hero Ernesto “Che” Guevarra by leading his faithful into a civil war.

The FAN is believed to have at least 80,000 professional soldiers, who could be forced to face two-million urban guerrillas.

A civil war in Venezuela would be intense, extremely destructive, and spell doom for the future of Venezuela’s economy, society, and oil output. Due to the nature of asymmetrical warfare, it would be nearly impossible to completely eradicate a group of dedicated and trained Chavez supporters.

Sam Logan (www.samuellogan.com) is an investigative journalist who has studied security, energy, politics, economics, organized crime, terrorism, and black markets in Latin America since 1999.