BOLIVIA: THE IMPACT OF OPERATION BLAST FURNACE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86T01017R000707400001-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 22, 2016
• Document Release Date: March 21, 2011
• Sequence Number: 1
• Publication Date: October 3, 1986
• Content Type: MEMO

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Central Intelligence Agency
Washington. D. 0.20505
DATE I ~ I7 I ~ ~ ~ F=
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Bolivia: The Impact of Operation Blast Furnace
Summary
Operation Blast Furnace, the Bolivian-US antinarcotics effort, has achieved
considerable success in disrupting cocaine processing and traf#icking operations in
Bolivia' since it began last July, but these gains have been accompanied by virtually no
arrests or drug seizures and may be only temporary. US military participation is now
scheduled to end on 15 November and the Bolivian government, which has not met US
targets for coca eradication, will be disappointed by its likely failure to obtain firm
offers ;of US antinarcotics and economic assistance in return for supporting the
operation. Without more US logistical and communications support, La Paz wilt be
unlikely to sustain operations at effective levels once US troops depart. Under these
conditions, the, drug trade probably will rebound to previous levels, bringing with it an
escalation of narcotics-related violence. Although the termination of joint efforts and
unfulfilled expectations of US aid are likely to generate some political criticism of
Washington, the official Bolivian response is likely to be low-key, as President Paz
Estenssoro remains firmly committed to close relations with the US. Still, the
post-Blast Furnace environment will probably present Paz Estenssoro with some
political costs. At a minimum, criticism that the Bolivian government caved in to US
antinarcotics pressures and received little in return will probably become more
widespread. An outpouring of. public criticism ,could prompt opposition leader Hugo
Banzer, who has generally supported Paz Estenssoro, to use the termination of Blast
Furnace and a US denial of future economic assistance to Bolivia as pretexts for
distancing himself from the government. A breakup of this political alliance, by itself,
might snot place the government in immediate jeopardy, but it could work to undermine
the military support the administration currently enjoys and precipitate a return to
coup plotting.
This memorandum was prepared by (South America Division, Office
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of African and Latin American Analysis, and International Narcotics
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uivision, utttce of vlobai issues. it was cooratnarea warn me uirecrorare or uperations.
Information as of September 1986 was used in the preparation of this paper. Questions
and comments may be directed to the Chief, South America Division, ALA;
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Available evidence indicates that Blast Furnace has dramatically slowed cocaine processing
and trafficking in Bolivia. Since the operation began, several major laboratories have been
raided, but there have been virtually no arrests or drug seizures.
the few traffickers who continue to produce and sell coca
paste do so at night, using remote rivers and lakes to transport drugs and chemicals
instead of the normal air routes. rumors the raids would
move into the coca-growing Chapare region caused a dramatic drop in activity there
Paz Estenssoro quickly managed to gain sufficient backing for the operation to
silence his critics. Although the leftist-dominated labor confederation, the Bolivian Workers
Central, and its political allies charged that the entry of US troops into Bolivia constituted
an invasion, debate on the subject subsided when the leading opposition party proclaimed
its support for the fight against drug trafficking. Since the operation began, the US
Embassy has reported evidence of growing public concern over the domestic effects of the
narcotics problem, including Bolivia's first antinarcotics demonstration that attracted a
crowd of seven thousand in La Paz. In addition,
leaders pledged to support the antinarcotics raids.
Sustaining the Effort
Although Operation Blast Furnace has had measurable short-term positive impact, we
doubt that continued operations against drug producing facilities alone, with or without US
cooperation, will have a lasting effect on the Bolivian drug trade. Traffickers can easily
absorb financial losses and rebuild or relocate facilities, using a small portion of their drug
smuggling profits. Moreover, the traffickers probably retain their full capability to export
cocaine from Bolivia because they continue to tap drug stockpiles
or increase production at unharmed laboratories--drug laboratories usually
do not operate at full capacity--to compensate for production lags.
While Bolivian antidrug authorities for the first time have put powerful cocaine
traffickers on the defensive, we judge that enforcement efforts must be intensified or the
level of narcotics activity will rebound. Drug traffickers are likely to draw lessons from the
current operations, strengthening their organizations in order to counter future government
interdiction efforts. For example Blast Furnace
prompted one major trafficker to make plans to move some of his operations closer to the
Brazilian border and to base several aircraft in neighboring Paraguay
We believe that Bolivia's severe narcotics problem necessitates athree-step approach
that continues interdiction efforts and includes strategies to eradicate excess coca
cultivation and dismantle powerful trafficking networks. Such coordinated approaches are
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likely to pose difficulties for La Paz, however, because of political repercussions and threats
to the safety of government officials. We judge that effective narcotics control programs,
however risky, must address all three key elements of the drug trade to have along-term
effect on the flow of cocaine to Bolivia.
In the near term, we believe that La Paz will need to demonstrate its commitment to
leash the drug industry by continuing raids on remote cocaine processing facilities and
interdicting internal smuggling of coca products. This requires the antinarcotics strikeforce
to attain a more effective helicopter and riverine patrol capability, including an apparatus to
provide maintenance support and to conduct specialized training. The Bolivian Air Force's
four helicopters have frequent mechanical problems, and anti-drug units lack the
manpower and equipment to monitor the country's extensive river systems that serve as
natural highways to transport coca products to cocaine laboratories or transshipment
points. Even without additional resources, results could be improved with better collection
and analysis of intelligence as well as closer coordination of police and military efforts.
Coca eradication programs are essential to reduce the abundant, and ever-expanding,
supply of coca leaf destined for illegal markets. In South America, Bolivia is second only to
Peru in coca leaf production, and we believe that the 35,000 hectares now under cultivation
are likely to increase as new plantings become productive. Even though a major coca
reduction plan was initiated last November*, only a few fields have been destroyed, and
coca cultivation remains virtually unchecked. President Paz Estensorro has been reluctant
to take measures that are likely to strain his relations with the peasant coca farmers from
whom his party draws much of its political strength. We judge that Bolivia will continue to
avoid implementing eradication ro rams, referring rather to emphasize the less
controversial interdiction plans.
Dismantling or immobilizing the powerful trafficking networks by jailing major cocaine
traffickers is probably the most effective measure to undercut drug production and
smuggling. Powerful Bolivian organizations have suffered little from the crackdown and
have clearly demonstrated their flexibility in countering conventional enforcement efforts.
traffickers were not concerned about losing
facilities during Blast Furnace, but feare physical harm and extradition to the United
States.
Although the Bolivian government is willing to continue the current interdiction effort,
its antinarcotics forces lack the necessary training, communications capabilities, and
intelligence systems to sustain the operation without continuing US logistical support.
* See Appendix
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Both Washington and La Paz have recommended that a joint task force consisting of US
and Bolivian armed forces and police be formed to delineate military and police
antinarcotic responsibilities, smooth police-military relations, and facilitate a joint
civilian-military antinarcotics effort in Bolivia.
Implications for the United States
Bolivia expects increased economic aid in return for its participation in Operation
Blast furnace, having asked fora $300-$500 million antinarcotics assistance package in late
August. If US aid is not provided, it would reinforce sentiments voiced by some opposition
figures that Bolivia has been used to serve larger US policy interests. As a consequence,
Bolivian popular suaQOrt for joint interdiction efforts would be likely to diminish
considerably.
Negative impact on bilateral relations, however, would be limited. Paz Estenssoro has
already benefited from US support for his position in debt negotiations with international
banks and he recently obtained an IMF standby loan. Moreover--because of widespread
corruption and an increasing domestic abuse problem--he recognizes the need to
eliminate Bolivia's narcotics industry and generally shares US eradication objectives, even if
he is unable to comply with them. According to the US Embassy, Paz Estenssoro believes
it is essential that Bolivia and the US move quickly to exploit the current depression in the
coca market to begin coca eradication and crop substitution.
Looking Ahead
Nonetheless, if Operation Blast Furnace ends without sufficient US aid to enable the
Bolivians to sustain the effort on their own, popular support for Paz Estenssoro's
government may erode. The criticism already voiced by some leftist opponents that the
President caved in to US antinarcotics pressures and received little in return would
probably become more widespread. In addition, the perception of declining public support
for Paz Estenssoro may give opposition leader Hugo Banzer, with whom Paz Estenssoro
has a tactical alliance, reason to distance himself from the President.
Banzer--who publicly advocates a strong approach against narcotics
traffickers--supported the joint US-Bolivian operation largely because La Paz lacked the
funds to act on its own. A defection by Banzer, along with the increased potential for
violence by trafficker-backed peasants, could start to undermine the government.
Moreover, the appearance of vulnerability could encourage reduction in the military's
support for Paz Estenssoro and possibly a return to the coup plotting that has
characterized previous administrations.
We also believe that the potential for trafficker-instigated violence against police
units and government officials will increase significantly once US forces depart. The
presence of US troops and sophisticated helicopters has been a major factor in inhibiting
reprisals from powerful and well-armed cocaine traffickers. Moreover, should Bolivia
continue efforts against traffickers, drastic retaliatory measures may be taken by the
traffickers once they realize that they cannot merely wait out police operations as they
have done in the past.
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The recent extension of Operation Blast Furnace until 15 November gives Washington
and La Paz time to prepare for the transition from a joint effort to aBolivian-directed
interdiction program. We expect the Bolivians to try to sustain the missions against
trafficker facilities as long as they continue to receive US antinarcotics assistance. We
judge that some two to three years of augmented support and training may be required by
the Bolivians to continue disrupting the cocaine trade and to build an effective
counternarcotics program. In the meantime, Bolivian traffickers are likely to bounce back
from losses incurred during Blast Furnace with more sophisticated cocaine producing and
smuggling methods. For example, Blast Furnace has
prompted traffickers to build "disposable" cocaine processing facilities that can be quickly
disassembled and to relocate operations in more remote regions. To stop the traffickers,
La Paz must sustain its efforts over the long term and obtain additional aircraft and basic
supplies along with supplemental training for police units in intelligence collection and
military operations.
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Appendix: The Bolivian Cocaine Industry
Legal coca cultivation and coca leaf use in Bolivia are deeprooted in tradition, a fact
that complicates control of the more recent illegal drug business--the processing and
export of cocaine--which permeates the country's modern society, economy, and political
system. The entrenchment of drug trafficking networks and the enormous profits they
generate have made La Paz's limited efforts at control more difficult. The current
US-Bolivian joint operation is aimed primarily at the destruction of cocaine processing
facilities in the remote northern and eastern sections of the country.
Coca cultivation is legal in Bolivia, where coca leaves have been chewed or brewed
into tea for centuries. Much of the estimated 32,000 tons of drug coca leaves being
produced annually, however, is illegally processed into cocaine or cocaine derivatives, a
significant portion of which flow into the US. Moreover,
new cultivation sites indicate that the drug industry there is expanding rapidly.
The Geography of Cocaine
Cultivation is centered in the Yungas and Chapare regions on the eastern slopes of
the Andes. The leaves are picked several times a year and processed into paste or base
nearby. In the past, most semi-refined coca products were flown mainly to laboratories in
Colombia for processing into cocaine, but in recent years increasing amounts have been
transshipped to large cocaine laboratories in northern and eastern Bolivia, a remote, lightly
populated expanse of jungle and savanna accessible only by aircraft or riverboat.
Difficulties in Enforcement
Past Bolivian efforts to reduce coca crops have failed to curb expanding cultivation,
and interdiction efforts have been only minor irritants to powerful drug trafficking
organizations. President Paz Estenssoro last November cautiously embarked on a hastily
designed antidrug program that emphasized eradication of illegal coca cultivation.* By
January extensive peasant opposition--both passive and violent--to crop destruction and
police operations prompted the government to curtail its efforts.
The emphasis of current antidrug efforts is on disrupting the narcotics trafficking
infrastructure. The joint US-Bolivian operation is directed against cocaine laboratories in
the Beni and Santa Cruz departments and the Bolivians are stepping up their own efforts
against field processing facilities in the Chapare.
*Coca cultivation is illegal when it is grown outside of legally established areas or
exceeds the limit of two hectares per owner.
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SUBJECT: Bolivia: The Impact of Operation Blast Furnace
Dissemination:
EXTERNAL:
1 -The Honorable Ann Wrobleski, INM, State Department
1 - Mr. Jerrold M. Dion, INM, State Department
1 - Dr. Carlton Turner, SA to the President
1 - Mr. Gene Williams, Office of the Vice President
1 -The Honorable Elliott Abrams, Inter-American Affairs,
State Department
1 - Mr. Paul Taylor, State Department
1 - Mr. Robert Gelbard, Inter-American Affairs, State
Department
- Ms. Vicki Huddleston, ARA, State Department
- Mr. Dwight Ink, AID, State Department
- Mr. Larry Dash, AID, State Department
- Ms. Penelope Farley, AID, State Department
- Mr. Douglas P. Mulholland, Treasury Department
- Mr. Ciro DeFalco, Treasury Department
- Mr. Greg Christopoulos, Treasury Department
- Mr. William von Raab, US Customs Service
- Col. Richard Childress, NSC
- Mr. Lucian Heichler, INR/C State Department
- Mr. Byron Jackson, Commerce Department
Original - Requestor
1 - D/DCI-DDCI Executive Staff
1 - SA/DDCI
1 - O/DDI
1 - NIO/NAR
1 - NIO/LA
1 - C/NIC/AG
1 - PDB Staff
1 - C/PES
1 - DDt/CPAs/ILS
1 - D/ALA
1 - DO/ALA
1 -Executive Director
2 -ALA/PS
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SUBJECT: Bolivia: The Impact of Operation Blast Furnace
1 -ALA Research Director
5 -CPAS/IMC/CB
1 -CPAS/ISS
2 -ALA/SAD
2 -ALA/SAD/AN
1 - D/OGI
1 - DD/OGI
2 - OGI/IND
2 - OGI/IND/A
4 - OGI/PG/CH
1 - OGI/EXS/PG
1 - DO/LA
1 - DO/LA
1 - DO~~
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