Drug Control: U.S. Counternarcotics Efforts in Colombia Face Continuing
Challenges (Chapter Report, 02/12/98, GAO/NSIAD-98-60).

Pursuant to a congressional request, GAO reviewed the status of drug
control efforts in Colombia and the impact of the 1996 and 1997 U.S.
decisions to decertify Colombia as a drug-fighting ally, focusing on:
(1) the nature of the drug-trafficking threat from Colombia; (2) the
political, economic, and operational implications of the decertification
decisions; and (3) U.S. efforts to plan and manage counternarcotics
activities in Colombia.

GAO noted that: (1) the narcotics threat from Colombia remains and may
be growing, and U.S. efforts in Colombia continue to face major
challenges; (2) the United States has had limited success in persuading
the Colombian government to take aggressive actions to address
corruption within the government, which limits its ability to arrest and
convict traffickers; (3) for its part, the United States has had
difficulty implementing a well-planned and coordinated strategy to
assist Colombian authorities; (4) according to recent Department of
State and Drug Enforcement Administration reports, the cultivation of
coca leaf in Colombia increased by 50 percent between 1994 and 1996, and
the prevalence of Colombian heroin on the streets of the United States
has steadily increased; (5) since the initial decertification decision
in March 1996, Colombia has taken several actions to address U.S.
concerns; (6) at the initial decertification decision in March 1996,
State was not prepared to determine whether some programmed assistance
intended for the Colombian police and military could continue to be
provided; (7) it took State, in conjunction with other executive branch
agencies, about 8 months to decide what could be provided; (8) as a
consequence, about $35 million in programmed counternarcotics assistance
was cancelled or delayed; (9) however, the overall operational
implications of the cut off on U.S. and Colombian counternarcotics
program is unclear; (10) the U.S. counternarcotics effort in Colombia
has continued to experience management challenges; (11) State did not
take adequate steps to ensure that equipment included in a 1996 $40
million assistance package from the Department of Defense inventories
could be integrated into the U.S. Embassy's plans and strategies to
support the Colombian police and military counternarcotics forces; (12)
as a result, the assistance package contained items that had limited
immediate usefulness to the Colombian police and military and will
require substantial additional funding to become operational; and (13)
moreover, the military assistance was also delayed for 10 months because
State and the Embassy could not reach agreement with the government of
Colombia over acceptable end-use provisions to ensure that the
assistance was not being provided to units suspected of human rights
violations.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-98-60
     TITLE:  Drug Control: U.S. Counternarcotics Efforts in Colombia 
             Face Continuing Challenges
      DATE:  02/12/98
   SUBJECT:  Narcotics
             Drug trafficking
             Aircraft
             Law enforcement
             Federal aid to foreign countries
             Foreign governments
             Political corruption
             International cooperation
             Foreign policies
             International economic relations
IDENTIFIER:  Colombia
             Dept. of State International Narcotics Control Program
             Black Hawk Helicopter
             UH-1H Helicopter
             
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Cover
================================================================ COVER


Report to Congressional Requesters

February 1998

DRUG CONTROL - U.S. 
COUNTERNARCOTICS EFFORTS IN
COLOMBIA FACE CONTINUING
CHALLENGES

GAO/NSIAD-98-60

Drug Control

(711260)


Abbreviations
=============================================================== ABBREV

  DEA - Drug Enforcement Administration
  ELN - National Liberation Army
  FARC - Colombian Revolutionary Armed Forces
  FMF - Foreign Military Financing
  FMS - Foreign Military Sales
  IMET - International Military Education and Training
  INC - International Narcotics Control

Letter
=============================================================== LETTER


B-278692

February 12, 1998

The Honorable Charles E.  Grassley
Chairman, Caucus on International
  Narcotics Control
United States Senate

The Honorable Benjamin A.  Gilman
Chairman, Committee on International Relations
House of Representatives

The Honorable J.  Dennis Hastert
Chairman, Subcommittee on National Security,
  International Affairs, and Criminal Justice
Committee on Government Reform and Oversight
House of Representatives

As you requested, we reviewed the status of drug control efforts in
Colombia and the impact of the 1996 and 1997 U.S.  decisions to
decertify Colombia as a drug-fighting ally.  Specifically, we
examined (1) the nature of the drug-trafficking threat from Colombia;
(2) the political, economic, and operational implications of the
decertification decisions; and (3) U.S.  efforts to plan and manage
counternarcotics activities in Colombia. 

Unless you publicly announce its contents earlier, we plan no further
distribution of this report until 30 days from its issue date.  At
that time, we will send copies to appropriate congressional
committees, federal agencies discussed in the report, and other
interested parties. 

This report was prepared under the direction of Jess T.  Ford,
Associate Director, International Relations and Trade Issues, who may
be contacted on (202) 512-4268 if you or your staff have any
questions.  Other major contributors to this report are listed in
appendix III. 

Benjamin F.  Nelson
Director, International Relations
  and Trade Issues


EXECUTIVE SUMMARY
============================================================ Chapter 0


   PURPOSE
---------------------------------------------------------- Chapter 0:1

The Foreign Assistance Act of 1961, as amended, requires the
President to annually certify that major drug producing and transit
countries have cooperated fully with the United States or have taken
adequate steps on their own to achieve full compliance with the goals
and objectives established by the 1988 United Nations Convention
Against Illicit Traffic in Narcotic Drugs and Psychotropic
Substances.  If the President determines that a country is not
meeting these standards, most forms of U.S.  economic and military
assistance must be terminated.  On March 1, 1996, and again on
February 27, 1997, the President determined that Colombia was not
fully cooperating with the United States or taking adequate steps on
its own to combat drug-trafficking activities.  As a result of these
decisions, the United States implemented mandatory economic sanctions
and canceled or delayed millions of dollars worth of U.S. 
counternarcotics assistance to Colombia. 

The Chairmen, Subcommittee on National Security, International
Affairs, and Criminal Justice, House Committee on Government Reform
and Oversight; the House Committee on International Relations; and
the Senate Caucus on International Narcotics Control, asked GAO to
review the efforts of U.S.  and Colombian agencies, principally the
Colombian police and military, to conduct counternarcotics activities
in Colombia.  Specifically, GAO examined (1) the nature of the
drug-trafficking threat; (2) the political, economic, and operational
implications of the U.S.  decertification decisions; and (3) U.S. 
efforts to plan and manage counternarcotics activities in Colombia. 


   BACKGROUND
---------------------------------------------------------- Chapter 0:2

Colombia is the world's leading producer and distributor of cocaine
and a major source of heroin consumed in the United States.  For the
past two decades, the United States has supported Colombia's efforts
to reduce drug-trafficking activities and to stem the flow of illegal
drugs to the United States.  As part of a national strategy for
reducing the production of and trafficking in illegal drugs
worldwide, the United States set counternarcotics objectives for
Colombia that include increasing Colombia's political will and
capabilities to destroy major drug-trafficking organizations,
eradicate drug crops, conduct enforcement efforts, and strengthen its
institutions to support a full range of counternarcotics activities. 
To meet these objectives, the U.S Embassy in Colombia, through its
various components, including the State Department's Narcotics
Affairs Section, law enforcement agencies, the Department of Defense,
and various other components, established an annual program plan. 

The Department of State funds most of the specific plan activities as
part of its International Narcotics Control Program.  In addition,
the Department of Defense has provided some types of assistance and
equipment.  Since fiscal year 1990, the United States has programmed
approximately $731 million in assistance and equipment to support
Colombian police and military units involved in counternarcotics
activities. 


   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3

The narcotics threat from Colombia remains and may be growing, and
U.S.  efforts in Colombia continue to face major challenges.  The
challenges GAO identifies in this report are similar to those it has
identified over the past 10 years.  The United States has had limited
success in persuading the Colombian government to take aggressive
actions to address corruption within the government, which limits its
ability to arrest and convict traffickers.  This lack of political
will led to the President's decision to decertify Colombia in 1996
and 1997.  For its part, the United States has had difficulty
implementing a well-planned and coordinated strategy to assist
Colombian authorities.  Decisions on the provision of U.S. 
assistance and equipment have been delayed for a number of reasons,
and coordination both within the Department of State and between
State and other involved federal agencies has often been poor or
lacking.  These problems have hampered U.S.  efforts to combat
illegal narcotics trafficking in Colombia. 

According to recent State Department and Drug Enforcement
Administration reports, the cultivation of coca leaf in Colombia
increased by 50 percent between 1994 and 1996, and the prevalence of
Colombian heroin on the streets of the United States has steadily
increased.  Significant obstacles, including widespread corruption
and extensive violence, impede U.S.  and Colombian counternarcotics
efforts.  Colombian insurgent groups have further complicated the
situation, as they are increasingly involved in drug-trafficking
activities, making it difficult for Colombian police and military
forces to reduce drug-trafficking activities within their borders. 

Since the initial decertification decision in March 1996, Colombia
has taken several actions to address U.S.  concerns, including
passing laws to hinder drug-trafficking and signing a maritime
agreement with the United States to allow greater pursuit of
drug-trafficking suspects.  It has also continued to eradicate
illicit drug crops and interdict drug-trafficking activities.  U.S. 
officials believe Colombia must now fully implement newly passed laws
on asset forfeiture, money-laundering, and trafficker sentencing and
show a willingness to investigate and punish corruption. 
Decertification had little effect on Colombia's economy because the
President chose not to apply discretionary sanctions against the
country.  However, mandatory economic sanctions required by the
decertification decisions led to the termination of some U.S. 
economic aid and may have hurt some U.S.  businesses. 

At the initial decertification decision in March 1996, the State
Department was not prepared to determine whether some programmed
assistance intended for the Colombian police and military could
continue to be provided.  It took State, in conjunction with other
executive branch agencies, about 8 months to decide what could be
provided.  As a consequence, about $35 million in programmed
counternarcotics assistance was canceled or delayed.  However, the
overall operational implications of the cutoff on U.S.  and Colombian
counternarcotics program is not clear.  The Colombian police and
military were able to maintain or increase some types of operations
by purchasing parts and equipment on the commercial market that were
once available through the Department of Defense.  Also, the U.S. 
Embassy helped fund some of the activities with resources taken from
other projects.  However, Colombian police told GAO that some
operations could not be conducted because certain types of assistance
were not available. 

The U.S.  counternarcotics effort in Colombia has continued to
experience management challenges.  For example, State and the U.S. 
Embassy were unprepared for the financial consequences of a 1996
decision to expand aerial crop eradication.  Due to unplanned
expenditures to support the eradication effort, other Embassy
counternarcotics activities, including interdiction efforts, demand
reduction within Colombia, and efforts to strengthen Colombian law
enforcement institutions, were scaled back or lost support. 
Moreover, State did not take adequate steps to ensure that equipment
included in a 1996 $40-million assistance package from Defense
Department inventories could be integrated into the Embassy's plans
and strategies to support the Colombian police and military
counternarcotics forces.  As a result, the assistance package
contained items that had limited immediate usefulness to the
Colombian police and military and will require substantial additional
funding to become operational.  Moreover, the military assistance was
also delayed for 10 months because State and the Embassy could not
reach agreement with the government of Colombia over acceptable
end-use provisions to ensure that the assistance was not being
provided to units suspected of human rights violations. 


   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4


      DRUG-TRAFFICKING ACTIVITIES
      ARE EXPANDING IN COLOMBIA
-------------------------------------------------------- Chapter 0:4.1

The narcotics threat from Colombia continues and may be expanding. 
Colombia provides almost three-quarters of the cocaine consumed in
the United States.  In addition, according to a September 1996 Drug
Enforcement Administration report, increases in the amount of
Colombian heroin seized in the United States have been significant. 
The Department of State reported in March 1997 that the amount of
coca under cultivation in Colombia increased from 44,700 hectares to
67,200 hectares, or about 50 percent, between 1994 and 1996.  U.S. 
officials attribute this increase partially to successes in reducing
drug-trafficking activities in Peru, where coca cultivation decreased
by 18 percent. 

According to the Drug Enforcement Administration, new cartels and
drug-trafficking groups have emerged as major drug-trafficking
organizations in Colombia.  Furthermore, insurgent groups have
increasingly funded their activities through drug-trafficking.  The
two groups posing the most serious threats to internal security are
the Colombian Revolutionary Armed Forces and the National Liberation
Army, with a combined strength of 10,000 to 15,000 personnel. 
According to a 1997 U.S.  interagency report, Revolutionary Force
units are involved in growing coca, protecting coca fields from
eradication, and providing security for drug-processing facilities of
various drug-trafficking organizations.  Recent reports also indicate
that the two insurgent groups are enhancing their capabilities and
are gaining strength throughout the country. 


      THE POLITICAL, ECONOMIC, AND
      OPERATIONAL IMPLICATIONS OF
      U.S.  DECERTIFICATION OF
      COLOMBIA
-------------------------------------------------------- Chapter 0:4.2


         COLOMBIA HAS TAKEN SOME
         ACTIONS TO ADDRESS U.S. 
         CONCERNS
------------------------------------------------------ Chapter 0:4.2.1

Since the initial presidential decertification decision in March
1996, Colombia has taken steps to address some U.S.  concerns,
including (1) enacting a new law allowing for the seizure of drug
traffickers' assets, (2) approving legislation increasing sentences
for drug-trafficking and money-laundering activities, (3) signing a
maritime agreement allowing the United States to pursue suspected
drug traffickers, and (4) passing a new extradition law.  However,
State Department and U.S.  law enforcement officials say that
Colombia must demonstrate greater political will by taking certain
actions, of which the key ones are

  -- addressing the pervasive public corruption that continues to
     weaken the government and undermine law enforcement activities;

  -- taking additional steps to improve prison security; and

  -- fully implementing the newly passed laws on asset forfeiture,
     money-laundering, and trafficker sentencing. 

According to State officials, these factors will be considered as
part of the 1998 certification process. 


         ECONOMIC SANCTIONS MAY
         HAVE HURT U.S. 
         COMMERCIAL INTERESTS
------------------------------------------------------ Chapter 0:4.2.2

The mandatory sanctions from decertification required the termination
of official U.S.  export and investment support of certain
transactions and may have resulted in business losses.  The Foreign
Assistance Act of 1961 and the Narcotics Control Trade Act of 1974
contain both mandatory and discretionary sanctions when the President
denies certification to a drug-producing or drug-transiting nation. 
Mandatory sanctions include the termination of most forms of foreign
assistance and bilateral loans, and a U.S.  vote against multilateral
development bank loans to the decertified country.  Counternarcotics
assistance provided through State's International Narcotics Control
Program and disaster and humanitarian aid are not subject to the
restrictions.  Discretionary sanctions include the loss of trade
preferences, the suspension of sugar quotas, tariff penalties, and
the curtailment of transportation arrangements.  According to State
and U.S.  Embassy officials, there was no intent to use discretionary
economic sanctions to harm Colombia's economy because the Colombian
private sector is viewed as a positive influence in strengthening the
government of Colombia's resolve to combat drug-trafficking
activities. 

The mandatory sanctions required by decertification have been cited
as harming U.S.  business activity in Colombia.  The State Department
reported that the 1996 decision required the Overseas Private
Investment Corporation and the Export-Import Bank to freeze about
$1.5 billion in investment credits and loans for U.S.  companies
investing in Colombia.  Also, a 1996 survey by the Council of
American Enterprises--an American business consortium in
Colombia--indicated that its member companies lost $875 million in
sales because of the sanctions.  State officials indicated they have
not conducted any in-depth assessment of the economic consequences of
decertification and could not validate the information in the survey
by the Council of American Enterprises. 


         OVERALL OPERATIONAL
         IMPACT OF DELAYS OF
         ASSISTANCE IS UNCLEAR
------------------------------------------------------ Chapter 0:4.2.3

As a result of the initial decertification decision in March 1996,
approximately $35 million in U.S.  counternarcotics aid was delayed
or canceled.  The State Department, in conjunction with other
executive branch agencies, took about 8 months to decide how much of
this aid could continue to be provided.  During this period, the
United States did not provide Colombia with some aviation spare
parts, vehicles, or ammunition and funding to repair a Colombian
counternarcotics aircraft.  The overall impact of the assistance
delays on Colombian counternarcotics operations is unclear. 
According to U.S.  and Colombian officials, most counternarcotics
operations were maintained by relying on other resources.  However,
Colombian police officials indicated that they could not conduct some
planned operations due to the U.S.  aid cutoff and that some
equipment purchased from the commercial market was more expensive
than equipment that could have been purchased through U.S.  military
assistance channels. 

The aid canceled or delayed included

  -- up to $30 million in counternarcotics Foreign Military Financing
     grant assistance (helicopter spare parts, ammunition, and
     explosives);

  -- about $1.4 million in planned U.S.  International Military
     Education and Training assistance for Colombian police and
     military units involved in counternarcotics operations:  and

  -- about $3.6 million in counternarcotics assistance to the
     Colombian police and military to be provided under the Foreign
     Military Sales program and the State Department International
     Narcotics Control program. 

The Foreign Military Sales and State assistance was released in
October 1996, but the Foreign Military Financing grant aid and some
military training was frozen until August 1997, when the President
released it as part of a national security waiver. 

According to U.S.  Embassy and Colombian officials, the delays in
U.S.  assistance prevented the Colombian police and military units
from receiving some U.S.-funded military training and from conducting
some planned counternarcotics activities.  However, data from the
Colombian National Police shows that they were able to operate their
interdiction and eradication helicopters at higher levels from March
1996 to June 1997, compared to the 2 months before decertification. 
U.S.  military reports indicated that each of the services conducted
more counternarcotics operations and seized more narcotics during
1996 than in 1995.  The U.S.  Embassy reported in February 1998 that
cocaine seizures have increased and that 42,000 hectares of coca were
sprayed during 1997. 

The impacts from assistance delays were minimized because the
Departments of State and Defense and the Colombian police and
military used other funding and procurement sources to obtain
critical support necessary to continue operations.  Both the
Colombian police and military purchased spare parts directly from
various commercial sources and used their existing inventories to
maintain their operational readiness rates.  These spare parts,
however, were substantially more expensive than they would have been
had the Colombians had access to U.S.  military assistance.  For
example, the Colombian police reported that certain helicopter parts
bought commercially cost 150 percent more than parts obtained through
U.S.  military sources.  In addition, the U.S.  Embassy used some
State and Defense funds to support Colombian police and military
eradication and interdiction efforts. 

U.S.  Embassy officials said that while the use of commercial and
other sources had enabled the Colombian police and military to
continue counternarcotics operations after the suspension of U.S. 
assistance, the higher expenditures for items and effectiveness of
operations could not be sustained over a long period. 


      PLANNING AND MANAGEMENT
      PROBLEMS HAMPER U.S. 
      COUNTERNARCOTICS EFFORTS IN
      COLOMBIA
-------------------------------------------------------- Chapter 0:4.3


         STATE AND THE U.S. 
         EMBASSY WERE NOT PREPARED
         TO MANAGE INCREASES IN
         AERIAL ERADICATION
------------------------------------------------------ Chapter 0:4.3.1

In October 1996, the State Department, through its Bureau of
International Narcotics and Law Enforcement Affairs, decided to
significantly increase the level of U.S.  support for and
participation in Colombia's aerial eradication of coca and opium
poppy, primarily to improve upon the eradication results of 1995 and
1996.  However, the Narcotics Affairs Section at the U.S.  Embassy
was unprepared for the escalation in costs to support this effort and
was unable to fully support other planned counternarcotics programs
meant to achieve all of the Embassy's counternarcotics objectives. 

During fiscal year 1997, State increased the number of aircraft and
U.S.  contractor personnel involved in the aerial eradication
program.  The contractor personnel's role also changed from being
primarily responsible for training Colombian pilots and mechanics to
directly maintaining aircraft and actively participating in planning
and conducting eradication operations. 

Throughout fiscal year 1997, the Narcotics Affairs Section
continually adjusted its estimates for the amount of funding needed
to support its program efforts from about $19 million in the
beginning of the fiscal year to $34 million by July 1997.  According
to various U.S.  Embassy reports, these changes were caused by
unforeseen costs that the Embassy incurred as the result of the State
Department's decision to increase support for aerial eradication. 
For example, the Narcotics Affairs Section identified $3 million to
$4 million needed to upgrade security for contractor personnel that
was not included in the Embassy's original budget. 

In July 1997, the Embassy's Narcotics Affairs Section informed the
State Department that because of the expanded aerial eradication
effort, it had to reallocate $11 million from other planned
counternarcotics programs.  The Section went on to report that it
could not continue to support programs for Colombian police
interdiction units, demand reduction, and efforts to strengthen
Colombian law enforcement institutions.  Each of these programs
supports the Embassy's program plan to fulfill U.S.  counternarcotics
objectives in Colombia. 


         DRAWDOWN ASSISTANCE
         PACKAGE WAS POORLY
         PLANNED
------------------------------------------------------ Chapter 0:4.3.2

On September 30, 1996, the President, in accordance with
section 506(a)(2) of the Foreign Assistance Act, notified Congress
that Colombia would be provided about $40 million in assistance from
Defense Department inventories.  However, the package was hastily
developed and did not include sufficient information on specific
Colombian requirements, the ability of the host country to operate
and maintain the equipment, or the funding necessary from the United
States or Colombia to support it.  For example, Defense Department
and Embassy officials said they were given little time by the
National Security Council to determine what equipment was best suited
to meet the needs of the Colombian police and military
counternarcotics forces.  The package contained several items (C-26
aircraft, patrol boats, and utility landing craft) that did not meet
the priority needs of the Colombian police and military.  In
addition, because much of the equipment was not operationally ready
for use, substantial unbudgeted funding would be required for the
equipment to be of value to the Colombians.  For example: 

  -- Five C-26 aircraft included in the package could cost at least
     $3 million each to modify to perform the surveillance mission
     desired by the Colombian police and another $1 million to
     operate and maintain annually. 

  -- Twelve UH-1H helicopters, delivered in May 1997, had an average
     of only 10 hours of available flying time left before
     substantial maintenance was required.  By July 1997, the
     Colombian police reported that only 2 of the 12 helicopters were
     operational. 

  -- Six patrol boats required $600,000 to make them operational, and
     two of the boats were missing key parts and operational panels. 

In addition to these shortcomings, the military assistance was
delayed for 10 months while the State Department and Embassy
negotiated end-use monitoring agreements with the government of
Colombia to ensure that the aid was not being provided to units
suspected of human rights violations.  According to Embassy
officials, State took 4-1/2 months to provide guidance to the Embassy
on the terms to be presented to the Colombian government.  The delay
after that was partially due to the Colombian government's
unwillingness to finalize an acceptable end-use agreement. 


   RECOMMENDATION
---------------------------------------------------------- Chapter 0:5

GAO recommends that the Secretary of State, in close consultation
with the Secretary of Defense and the National Security Council, take
steps to ensure that future assistance authorized under section
506(a)(2) of the Foreign Assistance Act of 1961 is, to the maximum
extent possible, compatible with the priority requirements identified
in U.S.  counternarcotics programs and that adequate support
resources are available to maximize the benefits of the assistance. 


   AGENCY COMMENTS AND OUR
   EVALUATION
---------------------------------------------------------- Chapter 0:6

In written and subsequent oral comments to a draft of this report,
the Department of State said GAO's report was generally fair and
well-balanced.  State believed the report could be improved by
recognizing that the results of its programs were very effective, as
shown by the higher rates of eradication, more seizures, and more
support for key Colombian institutions.  State indicated that the
section 506(a)(2) assistance program to Colombia involved extensive
interagency consultation prior to the 1996 decision.  However, State
officials subsequently told GAO that some items, such as the C-26
aircraft, were added to the package at the last minute and that
adequate planning for equipment support requirements was not done
prior to the decision.  State officials supported GAO's
recommendation and acknowledged that better planning of Defense
drawdown assistance is desirable.  (State's comments are reprinted in
app.  I.)

GAO acknowledges in the report that State has reported increases in
coca eradication and cocaine seizures in 1997.  However, management
problems between Washington and the U.S.  Embassy might have been
avoided if State and other agencies had better planned eradication
and assistance efforts.  GAO continues to believe that better
planning and coordination of Defense drawdown assistance and support
requirements are needed to optimize assistance provided to Colombia. 

In written comments, the Department of Defense concurred with the
content of the report and agreed with GAO's recommendation that steps
be taken to ensure future assistance authorized under section
506(a)(2) is compatible with priority counternarcotics programs in
Colombia (see
app.  II). 


INTRODUCTION
============================================================ Chapter 1

Colombia is the world's leading producer and distributor of cocaine
and a major source of heroin consumed in the United States.  For the
past two decades, the United States has supported Colombia's efforts
to reduce drug-trafficking activities and to stem the flow of illegal
drugs to the United States.  Various U.S.  agencies, including the
Departments of State and Defense and the Drug Enforcement
Administration (DEA), are responsible for programs through which
counternarcotics assistance is provided to Colombian police and
military units.  From fiscal year 1990 through fiscal year 1997, the
United States provided or planned to provide these units with
assistance worth approximately $731 million. 


   THE U.S.  COUNTERNARCOTICS
   STRATEGY FOR COLOMBIA
---------------------------------------------------------- Chapter 1:1

The United States has supported counternarcotics activities in
Colombia since the 1970s.  Recently, the United States established
three major counternarcotics objectives to increase Colombia's
political will and capabilities to (1) destroy major drug-trafficking
organizations, (2) reduce the availability of drugs through the
eradication of illicit drug crops and enforcement efforts, and (3)
strengthen Colombian institutions to enable them to support a full
range of interdiction activities.  These objectives support the
international goals in the U.S.  national drug-control strategy.  The
U.S.  Embassy program plan for fiscal years 1996 and 1997 focused on
the eradication of illicit drug crops, the interdiction of narcotics
and precursor chemicals, justice sector reform, the reduction of
money-laundering activities and the seizure of drug-related assets,
drug awareness and drug use reduction within Colombia, and
infrastructure development. 

Data provided by the Departments of State and Defense indicated that
during fiscal years 1990-97 the United States provided Colombia
approximately $731 million in counternarcotics assistance to support
Colombia's eradication and interdiction efforts.  As shown in table
1.1, various sources of funding were used to program this assistance. 



                               Table 1.1
                
                Sources of Funding for Counternarcotics
                          Assistance Programs

Source of assistance    Type of assistance
----------------------  ----------------------------------------------
International           The Foreign Assistance Act of 1961 authorizes
Narcotics Control       this State Department program, which provides
(INC) Program           assistance to countries to combat the
                        production and trafficking of illicit
                        narcotics overseas.

Foreign Military Sales  The Arms Export Control Act authorizes the
(FMS) Program           Defense Department to sell U.S. defense
                        articles and services to eligible countries.
                        The countries may procure items using their
                        own funds, U.S. grant funds, or U.S. loan
Foreign Military        funds.
Financing (FMF)
Program                 The Arms Export Control Act authorizes the
                        Defense Department to provide grant and loan
                        funds to friendly countries to improve their
                        defense capabilities through the acquisition
International Military  of U.S. defense articles and services.
Education and Training
(IMET) Program          The Foreign Assistance Act of 1961 authorizes
                        the provision of grants for professional
                        military education and management and
Section 506 (a)(2)      technical training to students from allied and
                        friendly nations.

                        The Foreign Assistance Act of 1961 authorizes
                        the President to approve the provision of U.S.
Excess defense          military goods and services to a foreign
articles                country for counternarcotics assistance when
                        it is in the U.S. national interest.

                        The Foreign Assistance Act of 1961 authorizes
                        the Defense Department to provide excess
                        equipment to the governments of major drug-
                        producing countries.
----------------------------------------------------------------------

Table 1.2 presents the funding for these programs. 



                                     Table 1.2
                      
                         U.S. Counternarcotics Support for
                       Colombian Police and Military (fiscal
                                   years 1990-97)

                               (Dollars in millions)

Fi
sc
al                                                                Excess
ye          INC         FMS         FMF      IMET   Section      defense
ar    Program\a     Program     Program   Program       506     articles     Total
--  -----------  ----------  ----------  --------  --------  -----------  ========
19        $20.0        $3.7       $71.7      $1.5     $20.0         $3.8    $120.7
 90
19         20.0        10.2        47.0       2.6         0          7.1      86.9
 91
19         23.4        14.3        47.0       2.3       7.0          3.2      97.2
 92
19         25.0        14.6      26.0\b       3.0         0            0      68.6
 93
19         20.0        67.6       7.7\b       0.9         0            0      96.2
 94
19         18.9        21.9      10.0\c       0.6         0            0      51.4
 95
19         22.9        10.4          0\       0.1      40.5            0      73.9
 96
19         46.6        75.0           0       0.6      14.2            0     136.4
 97
==================================================================================
To       $196.8   $$217.7\d      $209.4     $11.6     $81.7        $14.1    $731.3
 t
 a
 l
----------------------------------------------------------------------------------
\a Figures for fiscal years 1990-94 do not include State-supported
aviation costs. 

\b Part of this assistance was frozen until August 1997. 

\c All of this assistance was frozen until August 1997. 

\d Figures may include some FMS financed by the government of
Colombia for other than counternarcotics purposes. 

Source:  Departments of State and Defense. 


   U.S.  AGENCIES INVOLVED IN
   COUNTERNARCOTICS PROGRAMS IN
   COLOMBIA
---------------------------------------------------------- Chapter 1:2

The Office of National Drug Control Policy is responsible for
developing the President's national drug control strategy and
coordinating the funding of the federal agencies that implement
programs to support the strategy.  In Colombia, the primary federal
agencies involved in counternarcotics programs are the Departments of
State and Defense and DEA.  Other agencies that implement portions of
the U.S.  national drug control strategy in Colombia are the U.S. 
Agency for International Development and various U.S.  intelligence
agencies. 


      DEPARTMENT OF STATE
-------------------------------------------------------- Chapter 1:2.1

In the State Department, the Assistant Secretary for International
Narcotics and Law Enforcement Affairs is responsible for formulating
and implementing the international narcotics control policy,
coordinating the narcotics control activities of all U.S.  agencies
overseas, and overseeing the INC Program.  In 1996, the State
Department incorporated counternarcotics assistance that had been
provided from other sources, such as the FMF Program and economic
development assistance provided by the U.S.  Agency for International
Development, into the INC Program.  The State Department's Bureau of
International Narcotics and Law Enforcement Affairs manages an air
wing program through which it provides funds to support eradication
and interdiction operations in several countries, including Colombia. 
The Bureau has contracted with Dyncorp to provide logistical,
operational and training support for these operations. 

The Narcotics Affairs Section at the U.S.  Embassy manages the INC
Program.  The Section provides equipment and training, operational
support, and technical assistance and coordinates with Colombian
agencies involved in counternarcotics activities. 

Congress appropriated $230 million for State's worldwide INC program
for fiscal year 1998.  Of that amount, an estimated $30 million will
be used to support counternarcotics activities in Colombia, and an
estimated $50 million will be used to provide the Colombian police
with new and upgraded helicopters. 


      DEPARTMENT OF DEFENSE
-------------------------------------------------------- Chapter 1:2.2

In the Defense Department, the Coordinator for Drug Enforcement
Policy and Support and the Director of the Defense Security
Assistance Agency are primarily responsible for planning and
providing equipment and training to Colombia's military and law
enforcement agencies.  The U.S.  Southern Command is the Defense
Department's principal liaison with Colombia for coordinating the
administration of U.S.  counternarcotics aid.  In Colombia, the
Department's aid is primarily managed by the Embassy's U.S.  Military
Group.  The Group's responsibilities include coordinating security
assistance programs with the Colombian military and other U.S. 
agencies involved in counternarcotics operations and monitoring
assistance provided to Colombian military units to ensure that it is
being used for counternarcotics purposes. 


      DRUG ENFORCEMENT
      ADMINISTRATION
-------------------------------------------------------- Chapter 1:2.3

DEA is the principal federal agency responsible for coordinating drug
enforcement intelligence overseas and conducting all drug enforcement
operations.  DEA's objectives are to reduce the flow of drugs into
the United States through bilateral criminal investigations; collect
intelligence on organizations involved in drug-trafficking; and
support worldwide narcotics investigations covering such areas as
money-laundering, control of chemicals used in the production of
illicit narcotics, and other financial operations related to illegal
drug activities.  DEA also provides training to Colombian law
enforcement personnel through State's INC Program. 


   COLOMBIAN ORGANIZATIONS
   INVOLVED IN COUNTERNARCOTICS
   ACTIVITIES
---------------------------------------------------------- Chapter 1:3

Most U.S.  counternarcotics assistance has been used to assist both
Colombian National Police units and various military units involved
in operations to interdict drugs and eradicate drug crops and to
support other Colombian governmental entities that implement
money-laundering and asset forfeiture laws and investigate
drug-trafficking organizations. 

The Colombian National Police is the primary organization responsible
for interdiction and eradication operations, primarily through its
Directorate for Anti-Narcotics.  The Colombian armed forces also
support counternarcotics activities, primarily in support of police
counternarcotics operations. 


   CERTIFICATION OF DRUG-PRODUCING
   COUNTRIES
---------------------------------------------------------- Chapter 1:4

The counternarcotics certification process, as mandated by section
490 of the Foreign Assistance Act, has been a legal requirement since
1986.\1 Congress created the process out of concern that the
executive branch was not being tough enough in eliciting cooperation
in the antinarcotics effort from countries that were either the main
source of illicit drugs or through which drugs transited to the
United States.  A primary intent of the certification process is to
strengthen the political will of a country to combat illegal
drug-trafficking activities.  Section 490 requires the President to
certify by March 1 of each year which major drug-producing and
transit countries cooperated fully with the United States or took
adequate steps on their own to achieve full compliance with the goals
and objectives established by the 1988 United Nations Convention
Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances
during the previous year.  If a country has not met the statutory
objectives, the President can either deny certification and impose
sanctions or grant a vital national interests certification, which
recognizes that the requirement to use sanctions against a
noncooperating country would threaten the vital national interests of
the United States. 

Since the certification process was first established in 1986, the
number of nations subject to the certification process has ranged
from 24 to 31.  The number of nations denied certification has ranged
from 3 to 6 annually, and the number of nations granted a vital
national interest certification has ranged from 1 to 6.  In every
year prior to 1995, Colombia received full certification.  However,
Colombia was granted a vital national interests certification in 1995
and was denied certification in 1996 and 1997.  The March 1, 1996,
decision to deny certification to Colombia was unique in that it was
the first time certification was denied to a major U.S. 
counternarcotics partner and aid recipient. 

Mandated sanctions imposed against countries denied certification
include the termination of most forms of foreign assistance, and the
United States is required to vote against multilateral development
bank loans to that country.  Types of aid affected include sales and
financing under the Arms Export Control Act; nonfood assistance under
Public Law 480; financing by the U.S.  Export-Import Bank; and most
other foreign assistance, with the exception of counternarcotics
assistance provided through State's INC Program and humanitarian aid. 

The President is also authorized to invoke discretionary trade
sanctions against decertified countries.  These sanctions include the
removal of trade preferences under the Andean Trade Preferences Act
and the Generalized System of Preferences, the suspension of sugar
quotas, tariff penalties, and the curtailment of transportation
arrangements. 

To determine whether a country is fully cooperating with the United
States, the State Department establishes goals that it expects each
country to address in meeting U.S.  counternarcotics objectives.  The
goals are provided to each affected country through diplomatic
exchanges in either late spring or early summer of the year preceding
the certification decision.  In 1995 and 1996, the United States
provided Colombia with goals it used in assessing whether Colombia
would be certified on
March 1, 1996, and again on February 28, 1997.  In both instances,
the President determined that Colombia was not fully cooperating with
the United States in meeting U.S.  counternarcotics drug objectives. 

The President reached his decisions to decertify Colombia primarily
because of the following factors: 

  -- Throughout the Colombian government, corruption undermined the
     counternarcotics efforts of law enforcement and judicial
     officials. 

  -- Colombia did not take sufficient steps to strengthen its prison
     security.  As a result, captured cartel members continued to
     manage their activities from prison. 

  -- The Colombian government took no legislative steps to safeguard
     the confidentiality of U.S.-provided investigative information. 

  -- The Colombian government had not passed legislation to implement
     the extradition treaty it signed with the United States in 1979
     and did not respond to the U.S.  request for the extradition of
     four major drug traffickers. 

  -- The Colombian government could not reach agreement with the
     United States on testing and using a more effective granular
     herbicides to eradicate coca. 


--------------------
\1 Foreign Assistance Act of 1961, as amended (22 U.S.C.  2291j). 


   PRIOR GAO REPORTS IDENTIFY
   NUMEROUS OBSTACLES TO U.S.  AND
   COLOMBIAN ANTIDRUG PROGRAMS
---------------------------------------------------------- Chapter 1:5

Over the past 10 years, we have reported on various elements of the
U.S.  counterdrug effort in Colombia.\2 For example, we reported on
major obstacles within Colombia that hinder U.S.  antidrug programs. 
These obstacles include the limited ability of some Colombian
agencies to plan and implement an effective counternarcotics
strategy, the increasing insurgency and narcoterrorism activities
that limit Colombia's ability to maintain a presence in some
narcotics-producing and -processing areas of the country, the
expansion of drug cartel operations into the production and
distribution of heroin, and widespread corruption in the Colombian
government. 

We also reported on various U.S.  management problems that hindered
the implementation of effective counternarcotics programs in
Colombia.  Specifically, we reported that U.S.  officials lacked data
needed to evaluate program effectiveness in Colombia.  Further, we
reported that the Departments of State and Defense were not
coordinating their efforts with each other and did not have complete
oversight over U.S.  counternarcotics programs because they had not
developed an adequate end-use monitoring system to ensure that
U.S.-provided counternarcotics assistance was being used as intended. 
Finally, we reported that even though U.S.  legislation prohibits
counternarcotics aid from being provided to Colombian units engaged
in human rights abuses, it was difficult to implement because the
United States had not established procedures to make such a
determination. 


--------------------
\2 Drug Control:  U.S.-Supported Efforts in Colombia and Bolivia
(GAO/NSIAD-89-24, Nov.  1, 1988); Drug War:  Observations on
Counternarcotics Aid to Colombia (GAO/NSIAD-91-296, Sept.  30, 1991);
The Drug War:  Colombia Is Undertaking Antidrug Programs, but Impact
Is Uncertain (GAO/NSIAD-93-158, Aug.  10, 1993); and Drug War: 
Observations on the U.S.  International Drug Control Strategy
(GAO/T-NSIAD-95-182, June 27, 1995). 


   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:6

The Chairmen, Subcommittee on National Security, International
Affairs, and Criminal Justice of the House Committee on Government
Reform and Oversight; the House Committee on International Relations;
and the Senate Caucus on International Narcotics Control asked us to
review the efforts of U.S.  and Colombian agencies, principally the
Colombian police and military, to conduct counternarcotics programs
in Colombia.  Specifically, we examined (1) the nature of the
drug-trafficking threat; (2) the political, economic, and operational
impact of counternarcotics activities in Colombia since the initial
U.S.  decertification decision; and (3) U.S.  efforts to plan and
manage counternarcotics activities in Colombia. 

To address the threat issue, we received briefings from U.S.  law
enforcement, intelligence, and military officials and reviewed
documentation in Washington, D.C., and at the U.S.  Embassy in
Colombia.  To address the impact of the 1996 and 1997 decertification
decisions on Colombia and U.S.  efforts to plan and manage
counternarcotics activities, we visited various agencies in
Washington, D.C.; Panama; and Colombia.  In Washington, D.C., we
interviewed officials and reviewed planning, implementation, and
other related documents at the Office of National Drug Control
Policy, the Departments of State and Defense, DEA, and other federal
agencies.  In Panama, we interviewed U.S.  officials at the U.S. 
Southern Command and reviewed documents related to counternarcotics
activities in Colombia.  In Colombia, we interviewed Embassy
officials, including the Ambassador, and analyzed reports and other
documents from various U.S.  agencies that were responsible for
implementing counternarcotics programs in Colombia.  While in
Colombia, we also interviewed Colombian military, police, and
civilian officials to obtain their views on the issues discussed in
this report.  We analyzed Colombian police reports and other
documents to determine operational readiness.  We also analyzed
information provided by the U.S.  Embassy and the State Department
pertaining to all counternarcotics operations during 1996 and 1997. 
We did not validate any of the data found in the Embassy's reporting
on the economic impacts of decertification. 

Our review was conducted between March and December 1997 in
accordance with generally accepted government auditing standards. 


DRUG-TRAFFICKING ACTIVITIES ARE
EXPANDING IN COLOMBIA
============================================================ Chapter 2

Despite U.S.  and Colombian efforts to reduce drug-trafficking
activities, Colombian drug-trafficking organizations remain the
center of the cocaine trade and are becoming increasingly active in
the heroin trade in the United States.  Furthermore, Colombian
insurgent groups are becoming more actively involved in
drug-trafficking activities and are becoming more powerful, making it
more difficult for Colombian police and military forces to reduce
these activities within their borders. 


   DRUG CULTIVATION AND
   TRAFFICKING ACTIVITIES ARE
   INCREASING
---------------------------------------------------------- Chapter 2:1

Three-quarters of the world's cocaine is produced in Colombia.  In
addition, U.S.  law enforcement agencies believe that Colombian
drug-trafficking organizations are becoming increasingly active in
the heroin trade.  According to U.S.  government estimates, Colombia
produces 6.5 metric tons of heroin per year and about 600 to 700
metric tons of cocaine. 

Although Colombia was historically the world's third largest
cultivator of coca leaf, behind Peru and Bolivia, it recently
surpassed Bolivia as the number two cultivator, with an estimated
67,200 hectares of coca under cultivation in 1996.  In March 1997,
the State Department reported that Colombian coca cultivation had
increased by about 50 percent since 1994.  U.S.  officials attributed
this increase to the successful reduction of about 50 percent of the
known air-related drug-trafficking activities between Colombia and
Peru between 1992 and 1996.  According to U.S.  reports, this
reduction led to a glut of cocaine base in Peru, which in turn led to
a plunge in the price of cocaine base and a subsequent reduction in
coca cultivation.  In March 1997, the State Department reported that
coca cultivation in Peru declined by 18 percent between 1995 and
1996.  According to U.S.  officials, drug-trafficking organizations
thus began to increase coca cultivation in Colombia to ensure a
constant supply of coca leaf. 

The Colombian government has disrupted the activities of two major
drug-trafficking organizations, the Medellin and Cali cartels, by
either capturing or killing their key leaders.  However, this
disruption has not reduced drug-trafficking activities.  For example,
in June 1996, a U.S.  law enforcement agency reported that a new
generation of relatively young drug traffickers was emerging in the
North Coast, Northern Valle del Cauca, and newer Cali cartels.  In
July 1997, a U.S.  interagency report stated that hundreds of
Colombian criminal organizations are engaged in cocaine-trafficking. 

U.S.  and Colombian efforts to reduce drug-trafficking activities are
made more difficult by the ability of illicit drug organizations to
change their trafficking routes and methods of operations.  Various
U.S.  officials stated that since drug-trafficking activities by air
between Colombian and Peru were reduced, more activity is occurring
on Colombian rivers.  However, there is no accurate information on
the extent to which this is happening. 


   INVOLVEMENT OF INSURGENT GROUPS
   IN DRUG-TRAFFICKING IS
   INCREASING
---------------------------------------------------------- Chapter 2:2

Colombia's ability to reduce coca cultivation and related
drug-trafficking is complicated by the presence of active insurgent
groups and their involvement in drug-trafficking activities
throughout a large portion of the country.  The most active insurgent
groups are the Colombian Revolutionary Armed Forces (FARC) and the
National Liberation Army (ELN).  These two groups, with an estimated
strength of about 10,000 to 15,000 personnel, have increasingly
hindered the Colombian government's counternarcotics efforts. 

In 1993, we reported that both these groups were involved in
drug-related activities and that they controlled or influenced large
sections of Colombia, particularly in the sparsely populated south.\1
Since that time, our discussions with U.S.  and Colombian officials
and review of reports indicated that the groups are more actively
involved in drug-related activities and are gaining more control
throughout Colombia. 

Figure 2.1 shows the major coca-producing and opium poppy-producing
areas and the locations of the two insurgent groups most actively
involved in drug-trafficking activities in Colombia during 1996. 

   Figure 2.1:  Areas Where
   Illicit Drug Crops Are Grown
   and Insurgents Operate

   (See figure in printed
   edition.)

According to U.S.  officials, insurgent groups are in virtually all
regions where traffickers operate and have become more actively
involved in drug-related activities since the termination of Soviet
and Cuban financial support after the Soviet Union collapsed.  In
February 1997, a U.S.  interagency assessment of the role of the
insurgents in drug-related activities concluded that the insurgents,
primarily the FARC, were diversifying their involvement in several
ways.  For example, insurgents provide security to assist traffickers
in processing and transporting narcotics in exchange for money and
weapons.  Furthermore, a few insurgent groups are involved in
localized, small-scale drug cultivation and processing.  In March
1997, the Commander in Chief of the U.S.  Southern Command testified
before the Senate Armed Forces Committee that the FARC's
narcotics-related income for 1995 reportedly totaled $647 million. 

According to U.S.  officials, the task of conducting counternarcotics
operations is made more difficult for the Colombian police and
military because of the increasing strength of the insurgent groups. 
These officials stated that the insurgents are strengthening their
control in certain sections of Colombia.  An October 1997 Defense
Department analysis concluded that the groups are becoming more
sophisticated and pose a greater threat to the Colombian military. 
In addition, narcotics-related violence in Colombia has traditionally
been extensive.  For example, in February 1997, the Director of the
Colombian National Police and the General Commander of the Military
Forces of Colombia testified before the House of Representatives that
366 Colombian police and military personnel were killed in 1996 and
that since 1980 more than 3,000 Colombian policemen have died. 


--------------------
\1 The Drug War (GAO/NSIAD-93-158, Aug.  10, 1993). 


   CONCLUSION
---------------------------------------------------------- Chapter 2:3

The narcotics threat from Colombia continues and may be expanding. 
Drug-trafficking activities by Colombian organizations continue and
Colombian insurgent groups are becoming more actively involved in
supporting the drug-trafficking activities of these organizations. 
Coca cultivation has increased significantly in recent years, and
Colombian heroin is becoming more prevalent in the United States. 
The continuing narcotics threat presents significant challenges to
U.S.  and Colombian counternarcotics agencies. 


POLITICAL, ECONOMIC, AND
OPERATIONAL IMPLICATIONS OF THE
U.S.  DECERTIFICATION OF COLOMBIA
============================================================ Chapter 3

Since the initial decision to decertify Colombia in 1996, the State
Department has reported that Colombia has made some progress in
strengthening its political will to work with the United States to
achieve U.S.  counternarcotics objectives.  To show its commitment,
Colombia passed antidrug legislation, signed a maritime agreement to
help coordinate the apprehension of drug traffickers, and continued
to conduct counternarcotics operations.  However, State Department
officials believe that Colombia must do more to fully cooperate with
U.S.  counternarcotics efforts. 

Decertification had little effect on Colombia's economy, as the
President chose not to apply discretionary sanctions against the
country.  However, economic sanctions mandated by decertification may
have adversely affected U.S.  investment and business activity in
Colombia. 

When Colombia was initially decertified, the State Department was
unprepared to determine whether some programmed assistance intended
for the Colombian police and military could be provided.  It took
State, in conjunction with other executive branch agencies, about 8
months to decide what could be provided.  As a consequence,
approximately $35 million in U.S.  counternarcotics assistance was
canceled or delayed.  The overall implications of the assistance
delays are unclear.  Colombia has generally been able to mitigate the
loss of assistance by using alternative funding sources to purchase
needed equipment, some of which was provided by the Departments of
State and Defense.  Colombian police officials indicated that some
operations could not be conducted because certain types of assistance
were not available. 


   COLOMBIA HAS MADE SOME PROGRESS
   BUT HAS NOT FULFILLED ALL U.S. 
   COUNTERNARCOTICS OBJECTIVES
---------------------------------------------------------- Chapter 3:1

As we noted earlier, Colombia was decertified in 1996 and 1997,
primarily because political corruption within the government of
Colombia had undermined the counternarcotics efforts of Colombia's
law enforcement and judicial officials.  Despite the fact that
Colombia was decertified, U.S.  officials believe that Colombia has
made some progress in meeting various U.S.  counternarcotics
objectives.  Examples of Colombia's positive actions follow: 

  -- The government passed various laws to assist counternarcotics
     activities, including money-laundering and asset forfeiture laws
     in February 1997, and reinstated the extradition of Colombian
     nationals to the United States in November 1997. 

  -- The government signed a maritime agreement, along with a
     bilateral ship-boarding agreement, with the United States in
     February 1997 that provides for coordinated pursuit and
     apprehension of suspected drug traffickers. 

  -- Colombian law enforcement efforts resulted the capture or
     surrender of six of the seven top echelon members of the Cali
     cartel in 1995 and 1996, the reduction in the use of San Andres
     Island as a way station for drug shipments, and the pursuit of
     an ambitious crop eradication program in 1997 by the Colombian
     police. 

State Department officials believe that Colombia must take additional
actions to show its commitment to U.S.  counternarcotics efforts.  In
March 1997, the State Department informed the Colombian government
that to achieve certification from the United States, it would have
to take the following actions: 

  -- Test and apply a more effective, safe, reasonably priced
     granular herbicide. 

  -- Amend legislation to allow for the unconditional extradition of
     Colombian nationals involved in illegal narcotics activities. 

  -- Fully and effectively implement newly passed laws on asset
     forfeiture, money-laundering, and sentencing,

  -- Take all appropriate steps to stop drug traffickers from
     directing their organizations from prison. 

  -- Make every effort to support investigations and prosecutions to
     ensure that corrupt officials are brought to justice. 

According to State Department officials, these factors will be
considered as part of the next certification determination in early
1998. 


   ECONOMIC SANCTIONS MAY HAVE
   HURT U.S.  COMMERCIAL INTERESTS
---------------------------------------------------------- Chapter 3:2

The Foreign Assistance Act of 1961 and the Narcotics Control Trade
Act of 1974 require certain mandatory sanctions and allow
discretionary sanctions when the President denies certification to a
drug-producing or transit nation.\1 Mandatory sanctions include
suspension of U.S.  economic assistance, such as Export-Import Bank
and Overseas Private Investment Corporation financing, and voting
against multilateral economic assistance from organizations such as
World Bank and the Inter-American Development Bank.  Discretionary
sanctions include the removal of trade preferences under the Andean
Trade Preferences Act and the Generalized System of Preferences, the
suspension of sugar quotas, tariff penalties, and curtailment of air
transportation arrangements.  The President chose not to apply
discretionary sanctions against Colombia in either 1996 or 1997.  On
the other hand, the mandatory sanctions under decertification may
have hurt U.S.  businesses in Colombia. 

State and U.S.  Embassy officials said they did not conduct a
detailed analysis of the impact that economic sanctions would have
had on Colombia.  However, they pointed out that in 1996 and 1997,
they did not recommend imposing discretionary sanctions because the
United States did not want to hurt sectors of the Colombian economy
that were pressuring the Colombian government to strengthen its
counternarcotics laws. 

On the other hand, the State Department reported that the 1996
decertification decision required the Overseas Private Investment
Corporation and the Export-Import Bank to freeze about $1.5 billion
in investment credits and loans, including about $280 million for a
U.S.  company to invest in Colombia's oil industry.  State also
reported that a 1996 survey by the Council of American Enterprises,
an American business consortium in Colombia, concluded that because
its U.S.  member companies could not receive financing from the
Export-Import Bank under decertification, they lost $875 million in
potential sales, mostly to Asian and European competitors.  According
to a State Department official, State did not validate the
information in the Council's survey.  According to the Foreign
Commercial Service Attache at the U.S.  Embassy, however, anecdotal
information indicated that Colombian businesses were considering the
development of joint ventures with European and Asian companies
because decertification sanctions had made the U.S.  business
environment uncertain. 


--------------------
\1 The Foreign Assistance Act of 1961, as amended (P.L.  87-195) and
the Narcotics Control Trade Act of 1974 (19 U.S.C.  2491 et.  seq.). 


   OPERATIONAL IMPLICATIONS OF
   ASSISTANCE DELAYS ARE UNCLEAR
---------------------------------------------------------- Chapter 3:3

After the decertification decision on March 1, 1996, the Departments
of State and Defense canceled or delayed about $35 million worth of
assistance to the counternarcotics units of the Colombian police and
military.  The impact of this delay and the cancellation of
assistance on Colombian counternarcotics operations is unclear.  Our
review of U.S.  and Colombian records and discussions with various
U.S.  and Colombian officials indicated that most counternarcotics
operations were maintained despite the aid cutoff.  However, the
Colombian police and military were generally able to mitigate the
loss of U.S.  grant assistance by relying on other resources, but at
greater cost.  According to Colombian officials, they could have
conducted more counternarcotics operations if the assistance had not
been delayed. 


      ASSISTANCE AFFECTED BY
      DECERTIFICATION DECISION
-------------------------------------------------------- Chapter 3:3.1

Table 3.1 shows the source and amount of the $35 million worth of
assistance and training that was either canceled or delayed because
of the March 1996 decertification decision. 



                               Table 3.1
                
                 U.S. Assistance Canceled or Delayed by
                the March 1996 Decertification Decision

                         (Dollars in millions)

Source of funding              Amount      Status
---------------------------  --------  --  ---------------------------
Counternarcotics FMF grant      $30.0      Delayed until August 1997
 assistance
Counternarcotics assistance       2.5      Delayed until November 1996
 provided under the FMS
 Program
IMET Program                    1.4\a      Canceled
Department of State INC           1.1      Delayed until November 1996
 Program
----------------------------------------------------------------------
\a Includes approximately $800,000 in fiscal year 1996 funds that
were canceled due to decertification.  The $600,000 in fiscal year
1997 funds had to be canceled because the funding was released too
late in the fiscal year for Colombia to adequately meet its training
needs. 

Sources:  Departments of Defense and State. 

According to Defense Department officials, up to $30 million in FMF
grant aid that was delayed included items such as spare parts for
vehicles, fixed-wing aircraft, and helicopters; explosives and
ammunition; publications; and individual clothing items.  The
canceled training for Colombian police and military officials in U.S. 
schools was in a variety of areas, including human rights.  On August
16, 1997, the President issued a national security waiver, allowing
the $30 million in grant aid and $600,000 in IMET assistance to be
released to Colombian police and military units.  Without this
waiver, the assistance could not have been provided because of the
decertification requirement. 

The assistance delayed by State until November 1996 (about $2.5
million in FMS and $1.1 million in its own funds) included items such
as aviation spare parts, vehicles, ammunition and funding to repair a
Colombian police DC-3 aircraft and to provide a flight simulator to
train police pilots.  None of this assistance would have been delayed
had State been adequately prepared to judge whether the aid could
have continued to be provided on March 1, 1996.  As early as February
1995, State's Bureau of International Narcotics and Law Enforcement
Affairs had prepared a preliminary analysis of the types of
assistance that could continue to be provided in the event a country
was decertified.  State officials cited interagency legal concerns as
well as differences within the State Department regarding policy
concerns to explain why it took them
8 months to issue their final guidance on the types of assistance
that could be provided. 


      U.S.  AND COLOMBIAN EFFORTS
      TO MAINTAIN COUNTERNARCOTICS
      OPERATIONS
-------------------------------------------------------- Chapter 3:3.2

According to U.S.  Embassy and Colombian officials, the delays in
U.S.  assistance prevented the Colombian police and military units
from receiving some training funded under the IMET Program and
conducting some planned counternarcotics efforts.  However, these
officials indicated that most counternarcotics operations were not
drastically affected because alternative funding sources were
available.  They did note that some equipment was more heavily used
than it would have been had the assistance been available. 

According to U.S.  and Colombian officials, the cancellation of U.S. 
military assistance and training hurt efforts to improve
military-to-military relationships and to provide human rights
training to Colombian military officers.  They also indicated that
the delay in other assistance had some impact on the ability of the
Colombian police and military units to expand counternarcotics
operations.  For example, Colombia's Chief of the Counternarcotics
Police stated that because of the cutoff of U.S.  assistance, certain
types of explosives could not be provided.  As a result, he stated,
the police could destroy only 80 of the 210 airstrips they had
planned to destroy in 1996. 

The impacts from assistance delays were minimized because the
Departments of State and Defense and the Colombian Ministry of
Defense used other funding and procurement sources to continue to
provide critical logistics, spare parts, and training to Colombia's
counternarcotics forces to sustain operations.  Both the Colombian
police and military purchased spare parts directly from various
commercial sources and used their existing inventories to maintain
their operational readiness rates.  These parts, however, were
substantially more expensive than they would have been had U.S. 
grant assistance been available.  For example, the Colombian police
reported that certain helicopter parts bought commercially cost 150
percent more than parts purchased through U.S.  military assistance
channels.  In addition, the U.S.  Embassy used some State INC funds
and some Defense Department funds to support Colombian police and
military eradication and interdiction efforts. 

As a result of these actions, the Colombian police reported
improvements in operational rates for their helicopters.  Police
reports showed that helicopter operational rates for counternarcotics
operations were about 60 percent for the 2 months prior to the March
1, 1996, decertification decision.  However, from March 1996 to June
1997, the police helicopter operational rates were consistently in
the 70-percent range.  In addition, according to an Embassy report,
the Colombian air force increased the number of flying hours
dedicated to counternarcotics activities from 10,182 in 1995 to
10,605 in 1996. 

State Department data also indicates that Colombian police units were
able to continue conducting counternarcotics operations.  For
example, in March 1997, the State Department reported that the number
of cocaine laboratories destroyed by the Colombian law enforcement
agencies more than doubled, from 396 in 1995 to 861 in 1996.  During
this same period, the amount of cocaine seized increased from about
22 metric tons to 24 metric tons.  The U.S.  Embassy reported that
during 1997 the Colombian national police seized about 31 metric tons
of cocaine. 

U.S.  and Colombian officials stated that they were forced to rely
much more heavily on available equipment.  For example, one of two
DC-3 aircraft, cargo aircraft essential for supporting eradication
and interdiction operations of the Colombian police, was grounded by
a serious accident in August 1995.  About 4 months after the accident
occurred, the Colombian police forwarded a request to the Narcotics
Affairs Section to repair it.  The U.S.  Embassy approved the request
2 days later.  As a result of the March 1996 decertification
decision, the State Department could not decide if it could provide
funds to repair the aircraft.  In July 1996, the U.S.  Embassy made
the decision to repair the aircraft commercially, and repairs were
completed by the contractor in December 1996.  A primary reason for
the delay in repairing the aircraft was that State Department
officials were unable to determine whether the repairs were allowed
under decertification.  Because this aircraft was not available
during this time, the U.S.  Embassy reported that the police had to
double the use of the remaining DC-3 to conduct operations.  Even so,
it was impossible for the Colombian counternarcotics police to make
up for the lost time, according to Narcotics Affairs Section
officials.  Furthermore, according to the Section, the
counternarcotics police could not conduct additional activities
because of the inoperative DC-3. 



      CONCERNS OVER SUSTAINMENT OF
      COUNTERNARCOTICS ACTIVITIES
-------------------------------------------------------- Chapter 3:3.3

At the time of our visit in May 1997, U.S.  Embassy officials said
that while the use of commercial and other sources had enabled the
Colombian police and military to continue counternarcotics operations
after the interruption in U.S.  assistance, the higher expenditures
for items and the effectiveness of operations could not be sustained
over a long period.  In May 1997, the U.S.  Embassy reported that the
government of Colombia, as part of an overall budget reduction
decision, had reduced the 1997 budget for the Ministry of Defense by
30 percent less than the 1996 budget.  U.S.  and Colombian officials
stated that operations could not continue at their current rate
unless the United States provides additional assistance in the
future. 

Part of the sustainment concerns may have been addressed when the
President issued a national security waiver in August 1997 that
allowed the release of counternarcotics assistance.  Defense
officials stated that this assistance is now available for use by the
Colombian air force and navy.  However, according to State officials,
equipment for the Colombian army is pending because the Colombian
army has not complied with the agreement it signed regarding the use
of the assistance. 


PLANNING AND MANAGEMENT PROBLEMS
HAMPER U.S.  COUNTERNARCOTICS
EFFORTS IN COLOMBIA
============================================================ Chapter 4

As we noted earlier, for the past 10 years we have reported on a
number of management problems associated with U.S.  counternarcotics
activities in Colombia.  Some of these problems continue.  For the
past 2 years, U.S.  counternarcotics activities in Colombia have been
hampered because the State Department did not effectively plan and
manage funding and assistance to support the numerous and varied U.S. 
counternarcotics objectives in Colombia.  State and the U.S.  Embassy
could not fully support planned counternarcotics activities because
they were not well prepared for the consequences of expanding the
coca aerial eradication program.  Funding used to support the aerial
eradication effort came at the expense of other counternarcotics
activities.  Moreover, State did not take steps to ensure that
equipment included in a $40 million assistance package from Defense
Department inventories was consistent with the priority needs of the
counternarcotics forces of the Colombian police and military or with
the Embassy's counternarcotics plan.  As a result, the assistance
package included equipment that may be of limited benefit to the
Colombian police and military and will require additional funding not
budgeted for in Embassy plans.  Moreover, the military assistance was
delayed for 10 months because State and the Embassy could not reach
agreement with the government of Colombia over acceptable end-use
provisions to ensure that the assistance was not being provided to
units suspected of human rights violations. 


   THE STATE DEPARTMENT AND THE
   U.S.  EMBASSY WERE NOT
   ADEQUATELY PREPARED TO MANAGE
   THE CONSEQUENCES OF INCREASES
   IN AERIAL ERADICATION
---------------------------------------------------------- Chapter 4:1

Beginning in October 1996, the State Department, through its Bureau
of International Narcotics and Law Enforcement Affairs, decided to
significantly increase the U.S.  level of support and participation
in Colombia's aerial eradication operations against coca and opium
poppy.  According to State officials, the decision was made primarily
to improve upon the results achieved in 1995 and 1996 in eradicating
coca and opium poppy.  However, State had not developed an
operational plan and had not fully coordinated with the Narcotics
Affairs Section in the Embassy to implement the program increase.  As
a result, the Section was unprepared for the escalation in costs to
support this effort and was unable to fully support other programs
meant to achieve the Embassy's counternarcotics objectives.  In
addition, other components at the Embassy, including DEA and Defense
representatives, complained that the State Department was not
adequately supporting their activities to help meet the Embassy's
counternarcotics objectives. 

During fiscal year 1997, State increased the number of aircraft and
U.S.  contractor personnel involved in the aerial eradication
program.  As of July 1997, 112 contractor personnel--9 management and
administrative staff, 56 pilots and operations staff, and 47
maintenance staff--were in Colombia.  The contractor personnel's role
also changed from being primarily responsible for training Colombian
pilots and mechanics to directly maintaining aircraft and actively
participating in planning and conducting eradication operations.  The
State Department estimates that the direct costs of supporting the
contractor in Colombia increased from about $6.6 million in fiscal
year 1996 to $14 million in fiscal year 1997. 

Throughout fiscal year 1997, the Embassy's Narcotics Affairs Section
continually adjusted its estimates of the amount of funding needed to
support eradication efforts, from about $19 million in the beginning
of the fiscal year to $34 million by July 1997.  According to various
Embassy reports, these changes were caused by unforeseen costs
incurred as the result of the State Department's decision to increase
support for aerial eradication.  For example, in April 1997, the
Narcotics Affairs Section reported that it would require an
additional $1.4 million for unanticipated costs associated with
providing adequate security for contractor personnel at several
remote eradication locations and that this estimate did not include
costs associated with other major sites used to conduct eradication
missions.  According to the Section Director, an additional $3
million to $4 million to upgrade security at these locations was not
included in the Embassy's program budget.  Furthermore, the Section
reported that it had to reallocate $11 million from other projects to
support various aspects of the increased eradication efforts.  As a
result, by July 1997, the Section reported to State that it could not
fully support activities such as interdiction efforts, demand
reduction, and other efforts designed to strengthen the law
enforcement institutions of Colombia.  The Section also reported its
concerns about adequate funding for these activities in fiscal years
1998 and 1999. 

Various components at the U.S.  Embassy also raised concerns about
State's emphasis on eradication at the expense of their programs. 
For example, U.S.  military personnel in Colombia stated that the
State Department's emphasis on eradication hurt their efforts to
support the Colombian armed forces' ability to conduct their own
counternarcotics operations and to provide ground and air support to
the Colombian police when they are conducting eradication or
interdiction missions, particularly in areas where insurgent groups
are active.  DEA officials indicated that State's focus on coca
eradication displaced support for opium poppy eradication and other
drug-related law enforcement activities.  DEA officials also stated
that the proposed coca eradication program failed to respond to key
elements of the U.S.  counternarcotics objectives for Colombia. 

State officials agreed that the Embassy was not well prepared to
manage the escalation of costs associated with the increase in
support for aerial eradication.  However, they pointed out that the
spray program has been successful, with about 42,000 hectares of coca
sprayed by the end of December 1997.  They indicated that State may
not have adequate funding support for all its programs in Colombia in
fiscal year 1998 because State will spend about $50 million to help
the Colombians purchase three new Blackhawk helicopters and upgrade
UH-1H helicopters, in addition to the regular INC Program.  State
officials told us the fiscal year 1998 INC Program for Colombia is
currently under review. 


   DRAWDOWN ASSISTANCE PACKAGE WAS
   POORLY PLANNED
---------------------------------------------------------- Chapter 4:2

On September 30, 1996, the President, under section 506(a)(2) of the
Foreign Assistance Act, announced that he intended to provide
Colombia with about $40 million in counternarcotics assistance from
Defense Department inventories.  This action was justified on the
basis that important programs would grind to a halt without the aid
and that past investments in counternarcotics programs would suffer
due to the deterioration of equipment, training skills, and goodwill
on the part of those Colombians who daily put their lives at risk. 

According to officials from the Departments of State and Defense and
the U.S.  Embassy, key elements of the 1996 assistance package were
hastily developed, and some of the equipment in the package was not
the best suited to meet the priority needs of the Colombian
counternarcotics forces.  In addition, support requirements were not
fully assessed.  Defense Department and Embassy officials have
expressed concern that using this type of assistance without other
sources of funds for the additional support costs may not be the best
method for meeting critical counternarcotics needs of the Colombian
police and military units. 


      LIMITED PLANNING AND
      COORDINATION HAMPERED THE
      DELIVERY OF COUNTERNARCOTICS
      EQUIPMENT AND RESULTED IN
      ADDITIONAL COSTS
-------------------------------------------------------- Chapter 4:2.1

According to Defense Department officials, an assistance package
should be developed with extensive input from the Departments of
State and Defense.  This input includes information about specific
requirements of the recipient country, the ability of the recipient
country to operate and maintain the equipment provided, and the
ability of the U.S.  military to meet its own needs without the
equipment included in the assistance package. 

Beginning in July 1996, the State Department, in conjunction with the
U.S.  Embassy, began developing an initial list of equipment needed
by the Colombian police for inclusion in a possible section 506(a)(2)
drawdown assistance package.  The U.S.  Embassy prepared an initial
list of equipment for the Colombian police on July 29, 1996.  Because
this list did not contain equipment for the Colombian military, the
U.S.  Embassy had to prepare an expanded listing to include all
counternarcotics equipment for both the Colombian police and
military.  This list was sent to the Departments of State and Defense
on August 15, 1996.  Defense Department and Embassy officials stated
that even though this expanded list was developed, they were given
insufficient time to assess the requirements for the Colombian police
and military and to identify the costs associated with operating and
maintaining the equipment.  Furthermore, Defense Department officials
stated that they were given less than 2 weeks to conduct an analysis
on the availability of the equipment on the expanded list or the
impacts that withdrawing the equipment from defense inventories would
have on the readiness of U.S.  forces.  Finally, U.S.  officials
stated that some items, such as the C-26 aircraft, were added by the
National Security Council only
3 days before the list was provided to the President for his
approval. 

Table 4.1 summarizes the type of counternarcotics assistance provided
and planned for delivery to the Colombian police and military forces. 



                               Table 4.1
                
                   Section 506(a)(2) Counternarcotics
                    Assistance Planned for Colombia

                         (Dollars in millions)

Recipient/type of equipment                                    Value\a
------------------------------------------------------  --------------
Colombian National Police
C-26 aircraft (2)                                                 $6.0
UH-1H helicopters (12)                                             1.8
Rations and commodities                                            1.7
Ammunition                                                         0.4
Communications equipment                                           0.3
======================================================================
Subtotal                                                         $10.2

Colombian military forces
C-26 aircraft (3)                                                 $9.0
UH-1H helicopters (20)                                             3.0
Aircraft and helicopter spare parts                                6.0
Utility landing craft (1)                                          1.5
River patrol craft (9)                                             0.7
Communications equipment                                           4.7
Field equipment                                                    1.4
Training                                                           2.5
Utility vehicles (15)                                              0.9
======================================================================
Subtotal                                                         $29.7
======================================================================
Total                                                            $39.9
----------------------------------------------------------------------
\a Figures do not include transportation costs. 

Source:  Defense Security Assistance Agency. 

Limited planning and coordination of the package resulted in the
delivery of some assistance that did not meet the most pressing
counternarcotics needs of the Colombian police and military and added
substantial unanticipated support costs to operate and maintain, as
illustrated in the following four examples. 


         EXAMPLE 1
------------------------------------------------------ Chapter 4:2.1.1

The U.S.  Embassy identified a requirement to provide Colombian
police and military units with an aircraft capable of performing
surveillance missions.  According to officials from the Departments
of State and Defense, the National Security Council decided to
address this requirement by including five C-26 aircraft (two C-26
for the police and three C-26 for the military) in the assistance
package.\1 U.S.  Embassy and Colombian officials stated these
aircraft would not meet the surveillance needs of the Colombian
police and military as currently configured.  According to Department
of State and Defense officials, no decision has been made on how many
of the aircraft will have to be modified to perform the surveillance
mission, but modifying each aircraft selected for this mission will
cost at least $3 million.  According to U.S.  Embassy officials, the
C-26 was not included in any requirement plan for either the
Colombian police or military, and other types of aircraft would have
been more desirable.  In addition, both State and Defense have
estimated that operating and maintaining the aircraft will cost the
Colombian police and military at least $1 million annually. 

The State Department has agreed to provide up to $1 million to
support the two C-26 aircraft assigned to the Colombian police. 
However, State has no plans to provide support for the three C-26
aircraft assigned to the Colombian military.  Both U.S.  and
Colombian military officials stated that it would be more expensive
to maintain the logistics capability for such aircraft because of the
small number that have been provided.  They indicated that U.S. 
assistance should, to the maximum extent possible, provide equipment
to minimize expensive logistics. 


--------------------
\1 The C-26 aircraft is a military version of the Fairchild metro
10-passenger turboprop aircraft used by the Air National Guard. 


         EXAMPLE 2
------------------------------------------------------ Chapter 4:2.1.2

The 12 UH-1H helicopters in the assistance package were delivered to
the Colombian police in May 1997 with an average of less than 10
hours of flying time available before substantial maintenance would
have to be done on them to meet performance standards.  Two months
after the Colombian police received the helicopters, the Narcotics
Affairs Section reported that according to the Colombian police, only
2 of the 12 helicopters were operational and that unless sufficient
funds were provided to meet maintenance requirements, parts would be
removed from these helicopters to maintain its existing fleet of 38
helicopters.  The Section estimated the cost of the repairs at about
$1.2 million.  In August 1997, the State Department said that it
would provide additional assistance to make the helicopters
operational. 


         EXAMPLE 3
------------------------------------------------------ Chapter 4:2.1.3

The package listed a utility landing craft valued at $1.5 million to
support Colombian military operations against the transport of
narcotics on rivers.  Defense Department officials stated that if
they had been consulted earlier, the craft would not have been listed
in the package because not enough of the craft were available for
U.S.  Army units.  According to U.S.  military personnel, a smaller
vessel with more limited range was offered to Colombia as an
alternative, but the Colombian military said the boat did not meet
its needs. 


         EXAMPLE 4
------------------------------------------------------ Chapter 4:2.1.4

The six patrol craft included in the assistance package may be of
limited utility to the Colombian navy.  The Defense Department
reported that the craft had been taken out of service in 1993 and
required an estimated $600,000 in maintenance to make them
operational.  However, the U.S.  Navy cautioned that even if the
necessary repairs were made, the craft might be of marginal utility
due to their age.  Additional costs will have to be incurred before
the craft will be useful to the Colombian navy.  After the boats were
delivered, U.S.  military officials discovered that at least two of
them were missing parts and that the electrical panels on others were
open, making the boats' operational condition suspect.  Furthermore,
although the boats were intended to serve as command and control
platforms, radios and other equipment had been removed prior to their
delivery.  U.S.  Embassy officials do not know the total amount of
funding needed to make the boats operational and to improve their
combat capabilities but stated that Colombia would have to use its
own resources to make them operational and combat ready. 

U.S.  Embassy and Defense officials also expressed concern about the
heavy reliance on the use of drawdown assistance for counternarcotics
activities in Colombia.  They stated that equipment provided under
section 506(a)(2) of the Foreign Assistance Act usually requires
substantial support and additional funding for operations and
maintenance.  They stated that such assistance was a poor substitute
for a well-thought out counternarcotics assistance program and could
be harmful if complementary funding was not provided. 


      NEGOTIATIONS OVER AN END-USE
      MONITORING AGREEMENT DELAYED
      THE DELIVERY AND USE OF
      CRITICALLY NEEDED EQUIPMENT
-------------------------------------------------------- Chapter 4:2.2

In September 1996, Congress prohibited the obligation of INC funds to
assist units of foreign security forces when the Secretary of State
has credible evidence to believe that these units have committed
gross violations of human rights.\2 Therefore, the State Department
decided that no assistance would be provided to the military until
Colombia signed an acceptable end-use monitoring agreement to ensure
that the assistance was not being provided to units suspected of
human rights violations.  However, State did not provide guidance to
the Embassy on applying human rights provisions to U.S. 
counternarcotics assistance until February 13, 1997, almost 4-1/2
months after the legislation was enacted.  In the meantime, U.S,
Embassy officials signed a preliminary end-use monitoring agreement
with the Colombian Ministry of Defense on February 11, 1997.  The
U.S.  Ambassador believed that this agreement would be acceptable to
the State Department.  However, because of the new guidance, he
stated that he had to reopen negotiations with the Colombians. 

In February 1997, the U.S.  Embassy determined that there were no
human rights concerns about the Colombian police and satisfactory
progress was being made in negotiating an end-use monitoring
agreement with the Colombian navy and air force.  The 12 helicopters
in the drawdown assistance package were shipped to the Colombian
police in May 1997.  Even though the 6 boats and 20 UH-1H hulks for
the Colombian navy and air force were also shipped in May, the State
Department did not grant approval for use of the equipment until the
Colombian navy and air force signed the end-use monitoring agreement
in August 1997.  According to State Department officials, the lengthy
negotiations occurred because three different Colombian Ministers of
Defense were involved in negotiations during this period.  State
Department officials told us that assistance to the Colombian army
has still not been released because the Colombian army has not
fulfilled terms of the agreement. 


--------------------
\2 Foreign Operations, Export Financing, and Related Programs
Appropriations Act of 1997
(P.L.  104-208). 


   CONCLUSIONS
---------------------------------------------------------- Chapter 4:3

Implementation of U.S.  counternarcotics activities in Colombia has
been hampered by a lack of planning and management coordination both
within the Department of State and between State and other involved
federal agencies.  The State Department and the U.S.  Embassy in
Colombia were not well prepared to implement an expanded aerial
eradication program and to support other counternarcotics activities. 
In addition, State did not take adequate steps to develop and
integrate a $40-million assistance package for Colombian
counternarcotics police and military units.  Officials from the
Departments of State and Defense and the U.S.  Embassy said they had
spent little time consulting on the makeup and appropriateness of
items in the package.  However, in our view, the State Department, in
conjunction with the Defense Department and key elements of the U.S. 
Embassy, should have taken adequate time to prepare a priority list
of available equipment and associated support costs before the
assistance package was finalized. 


   RECOMMENDATION
---------------------------------------------------------- Chapter 4:4

We recommend that the Secretary of State, in close consultation with
the Secretary of Defense and the National Security Council, take
steps to ensure that future assistance authorized under section
506(a)(2) of the Foreign Assistance Act of 1961 is, to the maximum
extent possible, compatible with the priority requirements identified
in U.S.  counternarcotics programs and that adequate support
resources are available to maximize the benefits of the assistance. 




(See figure in printed edition.)Appendix I
COMMENTS FROM THE DEPARTMENT OF
STATE
============================================================ Chapter 4



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


The following are GAO's comments on the Department of State's letter
dated January 22, 1998. 

GAO COMMENTS

1.  We modified the table to reflect State's comment regarding
Foreign Military Sales (FMS).  However, according to Defense
Department records, all Foreign Military Financing (FMF) funds were
justified for counternarcotics purposes. 

2.  We deleted the sentence containing the 62-percent figure. 

3.  We modified the text to reflect that alternative funding sources
were provided by both the Departments of State and Defense. 

4.  As our report states, Colombia's Chief of the Counternarcotics
Police stated the Colombian police could destroy only 80 of the 210
airstrips it had planned to destroy in 1996 because certain types of
explosives could not be provided as a result of the cutoff of U.S. 
assistance. 

5.  We modified the report to address State's concern regarding the
amount of FMF grant aid that was delayed.  We note, however, that aid
was delayed for over 17 months until the President issued a waiver in
August 1997. 

6.  As we note in our report, the overall operational implications of
the cutoff on U.S.  and Colombian counternarcotics activities is not
clear.  The Colombian police and military were able to maintain or
increase some types of operations, but Colombian police told us that
some operations could not be conducted because certain types of
assistance were not available. 

7.  We modified the report to recognize that the decertification
policy was developed by State in conjunction with other executive
branch agencies. 

8.  We have added information on the nature of the delay in repairing
the DC-3.  As our report notes, the Colombian police were partially
to blame for the delay.  However, the State Department was
responsible for most of the delay because it had difficulty making a
decision on whether the aircraft could be repaired under
decertification. 

9.  We modified the report to recognize that some of the sustainment
concerns may have been addressed by the President's August 1997
national security waiver that allowed the release of counternarcotics
assistance. 

10.  We clarified our report in response to State's comment. 
However, as our report states, some items were added late in the
approval process, and the requirements of Colombia's counternarcotics
forces and the long-term support costs associated with U.S. 
assistance were not fully considered.  After providing their written
comments, State officials told us that the planning of section
506(a)(2) assistance should be improved, as we recommended.  They
said that Defense Department involvement in the process was the most
critical element in identifying the necessary assistance. 

11.  We modified the text to reflect State's comment. 

12.  We do not believe our report is contradictory.  We agree with
the State Department that an end-use monitoring agreement is
essential to ensure that U.S.  counternarcotics assistance is being
used as intended.  Our criticism is directed at the time spent to
develop criteria.  As our report points out, it took State almost
4-1/2 months to develop criteria for the Embassy's use in negotiating
an acceptable end-use monitoring agreement with the government of
Colombia. 

13.  Our report recognizes that the Embassy had reported increases in
the amount of coca sprayed and drug seizures in 1997.  However,
documents and interviews with Embassy officials did not support
State's comment that increasing the funding for the counternarcotics
police eradication operations in 1997 had no impact on other drug
enforcement activities.  According to these sources, support for law
enforcement assistance and institutional development; drug awareness
and drug demand reduction; and support for the Colombian armed forces
were reduced during this period. 

14.  Based on cable traffic, other documents, and discussions with
Embassy and State officials, it is clear that the Embassy was not
well prepared to manage the costs associated with the increase in
support for aerial eradication.  As our report indicates, throughout
fiscal year 1997, the Narcotics Affairs Section continually adjusted
its estimates of the amount of funding needed to support eradication
efforts, from about $19 million at the beginning of the fiscal year
to $34 million by July 1997.  Furthermore, according to the Narcotics
Affairs Section Director, an additional $3 million to $4 million
needed to upgrade security at several locations was not originally
budgeted for. 




(See figure in printed edition.)appendix II
COMMENTS FROM THE DEPARTMENT OF
DEFENSE
============================================================ Chapter 4


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix III


   NATIONAL SECURITY AND
   INTERNATIONAL AFFAIRS DIVISION,
   WASHINGTON, D.C. 
------------------------------------------------------- Appendix III:1

Jess T.  Ford, Associate Director
Allen Fleener, Senior Evaluator
Ronald D.  Hughes, Senior Evaluator
James T.  Strus, Senior Evaluator
Jose Pena, Evaluator
Nancy Ragsdale, Managing Editor

*** End of document. ***