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Volume I: Drug and Chemical Control


A. Introduction

The U.S. Government dropped Paraguay from the President’s list of major narcotics transit or producing countries in September 2010. Paraguay previously appeared on the major’s list as a significant marijuana source country. However, Paraguayan marijuana is trafficked to the neighboring countries of Brazil, Argentina, Chile and Uruguay but not to the United States. Paraguay does remain a transit country for cocaine produced in Bolivia, Peru and Colombia. But again, while a small portion of the cocaine from these countries that transits Paraguay may be destined for the U.S., the vast majority is transported to Brazil, Europe, Africa and the Middle East.

Paraguay continues to face significant challenges in its fight against narcotics production and trafficking. Its continental location, poverty, unemployment, crime, corruption, and limited governmental and security presence in much of the country, all impede counternarcotics efforts. Although domestic demand for illegal drugs remains low, Paraguay continues to produce a marijuana crop second only to Mexico. Seizures of precursor chemicals, including ephedrine, continue apace.

Despite these challenges, the Government of Paraguay (GOP) continued to make progress against illegal narcotics trafficking in 2010 and supported drug interdiction, eradication, and demand reduction efforts.

Paraguay is a party to the 1988 UN Drug Convention.

B. Drug Control Accomplishments, Policies, and Trends

1. Institutional Development

In June 2010, Paraguay’s Congress passed a new terrorism bill sanctioning the prosecution of acts of terrorism, terrorist association, and terrorism financing. The law is an important companion piece to the July 2009 legislation that established money laundering as an autonomous, punishable crime in Paraguay. Despite slow implementation and a lack of convictions, in 2010 SENAD, Paraguay’s National Antidrug Secretariat, continued to press for a full legal framework to combat drug trafficking, calling in October for President Lugo to press Congress to pass a long-stalled asset forfeiture law to better fund counternarcotics activities.

SENAD is staffed by a 366-person anti-narcotics unit, which includes 127 special agents and 68 military Special Forces operators conducting anti-drug efforts in the field. SENAD special agents have de facto law enforcement powers in that they carry weapons, conduct investigations, make arrests, and forward cases to prosecutors. However, SENAD has not been provided with law enforcement authority through legislation.

SENAD combats all aspects of the illegal drug trade nationwide from its Asuncion command base with regional offices, control points, airport control brigades, a 15-dog canine unit, and a Sensitive Investigation Unit. SENAD also works with Paraguayan customs to more closely monitor imports and exports. The Paraguayan National Police (PNP) has twenty-two thousand police officers and offices throughout the most remote areas of the country with the ability to conduct operations and investigations in those same areas. The PNP also maintains a counternarcotics unit, but its operations are separate from SENAD and the two organizations do not coordinate their efforts due to inter-agency rivalry, lack of trust, and a government-wide hierarchical management culture which does not encourage inter-agency cooperation.

As SENAD’s seizure and arrest statistics show, it continues to improve its ability to find and seize narcotics, leading to the arrest and prosecution of narcotics traffickers. However, weak prosecutorial presence in regions with high incidence of drug trafficking and judicial corruption continues to confound successful prosecution efforts in many SENAD cases.

In 2010, the GOP increased SENAD’s annual budget from approximately $2.98 million USD to approximately $3.53 million. While a positive step, additional resources are still needed. In particular, inadequate GOP funding hampers maintenance of one of SENAD’s most important assets, its drug analysis laboratory, which cannot operate at full effectiveness due to its antiquated and limited technical equipment. Compounding the problem, Paraguayan courts assign drug analysis work from PNP drug cases to the lab which, in addition to SENAD’s own workload, overburdens an already limited capacity.

Paraguay is a party to the 1988 UN Drug Convention, the 1961 UN Single Convention on Narcotic Drugs as amended by the 1972 Protocol, and the 1971 UN Convention on Psychotropic Substances. The GOP is also a party to the UN Convention against Transnational Organized Crime and its protocols, the United Nations Convention against Corruption, the Inter-American Convention against Corruption and the Inter-American Convention against Terrorism. The GOP also signed the Organization of American States Inter-American Drug Abuse Control Commission (CICAD) Hemispheric Drug Strategy. Paraguay has law enforcement agreements with Brazil, Argentina, Chile, Venezuela and Colombia. The United States and Paraguay cooperate in extradition matters under a 2001 extradition treaty. The 1987 bilateral Letter of Agreement under which the United States provides counternarcotics assistance to Paraguay was extended in 2004 and followed by yearly amendments through 2010. Paraguay is also a signatory to the 1992 Inter-American Convention on Mutual Assistance in Criminal Matters.

2. Supply Reduction

Drug traffickers use land, air, and sea operations to smuggle narcotics through Paraguay. Overland tanker trucks and large cargo trucks transporting cover loads of legitimate goods are the preferred method of smuggling cocaine from Bolivia through Paraguay and into Brazil. Border towns such as Pedro Juan Caballero, which has witnessed an increase in violence and Brazilian gang presence, Salto del Guaria, and Ciudad del Este are notorious narcotics, arms, and contraband transit centers with both vehicular and foot traffic crossing wide-open, typically unmanned borders. Small airplanes are also used to transport 200-250 kilogram drug shipments to the Chaco region near the Bolivian and Brazilian borders. Large farms in this area are used as bases of operation due to the harsh terrain, limited transportation routes, and minimal security presence in the region.

In 2010, and for the second consecutive year, SENAD doubled its cocaine seizures from the previous year, seizing 1,425 kilograms (kg) of cocaine and 3.5 kg of crack cocaine. Precursor chemical seizures fell in 2010, but all indications point to a continued stream of acetone, ephedrine, lidocaine, and other chemicals flowing through the country. In March, SENAD seized 30 kilograms of ephedrine from a cargo container destined for Mexico. Additionally, it seized 45 kg of lidocaine, 40 kg of acetone, 108 metric tons (MT) of marijuana, 110 vehicles (including motorcycles), 121 firearms, 4 airplanes, 4 boats, and made 312 arrests.

Paraguay’s two international airports and private and public maritime shipping ports are used to transport narcotics overseas. In 2010, SENAD’s canine unit made 16 airport seizures with 30 related arrests, the majority of which were of travelers destined for Western Europe. Ports on the Rio Paraguay link to Buenos Aires, Argentina and Montevideo, Uruguay, where shipping containers are combined with others, usually destined for Europe. Paraguayan customs has typically ignored exported containers, choosing to focus its limited resources on imported materials with higher revenue potential. In March 2010, Spanish officials seized 175 kg of cocaine in Seville; in April, German officials seized 1,300 kg of cocaine in Hamburg; and in June, officials in Hong Kong seized 70 kg of cocaine; all three cases involved containerized cargo originating in Paraguay.

According to the UN Office on Drugs and Crime 2010 World Drug Report, Paraguay is the world’s second-largest marijuana producer, trailing only Mexico in terms of its cannabis crop. Paraguayan marijuana is not trafficked to the United States. Production takes place primarily in the hilly, northeastern departments of Amambay, San Pedro, Canindeyú, and Concepcion near the border with Brazil. Multiple crops are harvested throughout the year. High international demand, low crop cost, continued rural poverty, unemployment, weak institutions, sparse government presence, and limited eradication efforts are causing marijuana cultivation to spread to new regions of Paraguay. According to SENAD officials, there are approximately 5,000 hectares of marijuana under cultivation; however the UN Office on Drugs and Crime places the estimate closer to 6,000 hectares.

In 2010, SENAD’s manual marijuana eradication operations in the departments of Canindeyú and Amambay destroyed 869 hectares of marijuana crops, 60 camps, and 12 marijuana pressing factories. SENAD seized 4,285 kilograms of marijuana seeds, wax and plants during eradication and interdiction operations. Additionally, SENAD continued working with, and receiving funds from, the Brazilian Government to conduct joint marijuana eradication missions in 2010 in two northeastern departments, Amambay and Canindeyú, which border Brazil. SENAD partnered with the Brazilian Federal Police (DPF) and established a cooperation program to fight marijuana production and trafficking utilizing DPF equipment and technical expertise including helicopters and remote sensors in marijuana plantations.

3. Drug Abuse Awareness, Demand Reduction, and Treatment

Domestic demand for illegal drugs in Paraguay remains low in comparison to neighboring countries. National estimates indicate marijuana is used by roughly 3 percent of the population and cocaine by 0.7 percent. Though there are no reliable numbers, both SENAD and the U.S. Drug Enforcement Administration (DEA) have expressed concerns that crack is increasing in popularity among young adults and children in Paraguay based on seizure numbers and reporting data.

SENAD conducts formal workshops, informal sessions, public seminars, and distributes informational materials in order to reach thousands of students, teachers, and parents in its role as the principal coordinator for the National Program Against Drug Abuse. A revised pilot program, begun in the third quarter of 2010 called “Prevent Together,” provides drug awareness information and evaluates its impact throughout the school year. Another SENAD initiative is a weekly demand reduction and narcotics education radio program. Due to poverty, illiteracy, and limited telecommunications and Internet connectivity in Paraguay’s sparsely populated countryside, radio reaches the largest percentage of the population.

In 2010, SENAD sponsored 335 workshops reaching 23,240 students, parents and teachers in 105 different educational institutions. It distributed 8,291 informational pamphlets and 149 DVDs to students, teachers and counselors, and conducted 41 radio broadcasts.

4. Corruption

As a matter of policy, the GOP does not encourage or facilitate illegal activity associated with drug trafficking. No senior government officials have been implicated in specifically facilitating or encouraging illegal activity. Nevertheless, corruption remains the principal barrier to reducing the production and distribution of illegal drugs. Corruption in the judicial system is a significant concern and is the greatest barrier to effective prosecution of drug traffickers and producers. Police officials are routinely involved in organized crime activities or accept bribes.

In September 2010, a three-judge panel absolved and released drug trafficker Mendi Pavao after an alleged $1 million payoff. Although the dismissal of the case is yet another example of judicial misconduct, the swift and strong reaction by the GOP to suspend the three judges and two prosecutors involved in the case is a positive sign and anticorruption efforts are a major priority for the current administration.

The U.S. Agency for International Development (USAID) continued phase II of the Millennium Challenge Corporation’s anticorruption project in 2010, targeting corruption within the judicial system and Paraguayan National Police.

C. National Goals, Bilateral Cooperation, and U.S. Policy Initiatives

The U.S. Mission in Paraguay works closely with the GOP to disrupt drug trafficking organizations; build stronger legal and regulatory measures to restrict money laundering, drug trafficking, and illegal contraband flows; and to enhance institutional capacities to carry out effective measures against narcotics trafficking. In 2010, SENAD received USG assistance for equipment and commodities, operational support, its canine detection program, and demand reduction initiatives. USG operational support sustains joint SENAD/DEA investigations of major narcotics traffickers, resulting in successful drug trafficking investigations documented by official records of drug seizures, arrests and cases presented for prosecution.

Meanwhile, the USG has expanded its cooperation with the PNP and Paraguayan Customs, creating both a new Sensitive Investigations Unit within the PNP and a new Container Group with Paraguayan Customs.

USG support for SENAD’s Narcotics Detection Canine Program continues to show results in seizures at border, port, and airport locations throughout Paraguay. Although the program received four new dogs in 2010, allowing it to expand its country-wide detection and seizure operations, the program remains constrained by the number of animals versus the number of potential transit points that need them, transportation capabilities, and the dogs limited use within airports. A more robust program would substantially increase seizure rates.

The USG funded the participation of SENAD and the Secretariat to Combat Money Laundering (SEPRELAD) agents at seminars on information sharing, software implementation, sensitive investigations training, drug and chemical controls, canine training, and money laundering. The USG also funded participation of the Paraguayan Navy in a Regional Small Boat maintenance course in Argentina. In addition, the USG provided support for members of SEPRELAD, prosecutors, and others associated with intellectual property rights initiatives.

D. Conclusion

Corruption remains a challenge to Paraguay’s ability to counter drug trafficking and prosecute narcotics traffickers. We encourage the GOP to continue to institute measures to address this issue. The GOP is also faced with increasing amounts of cocaine crossing into Paraguay -- particularly from Bolivia, limited law enforcement coverage, and corrupt police and customs officials who permit not only drug trafficking, but the trafficking of weapons and counterfeit materials as well. The GOP needs to augment SENAD’s presence on the Bolivian border and elsewhere, supply it with greater budgetary support, and encourage SENAD to work more effectively with other Paraguayan agencies such as the PNP and Customs.

In 2010, SENAD continued to demonstrate positive seizure results in spite of limited resources, and SENAD’s leadership has been effective at keeping pressure on narcotics traffickers. However, SENAD is constrained by the GOP’s failure to pass legislation giving it autonomy and its officers law enforcement authority, and, while SENAD’s seizure rate continues to improve, those seizures still represent only two to three percent of the cocaine likely transiting Paraguay.

We encourage the Government of Paraguay to effectively implement its anti-money laundering and anti-terrorism legislation, as well as to pass and implement the long-awaited asset seizure and forfeiture legislation and the new criminal procedure code pending before Congress.

The USG supports SENAD’s demand reduction and drug education programs which have reached tens of thousands of people throughout Paraguay. However, demand reduction efforts are constrained by a lack of clear demand and usage statistics. The agency has not conducted a thorough usage analysis since 2006. Having key information, such as tracking trends in drug use among younger users (70 percent of Paraguay’s total population is under 30), would enable SENAD to better focus both its demand and supply reduction efforts within the country.