Foncodes invests $4.2 million in VRAE development projects in 2009

Peru’s state development cooperation fund, Foncodes, said Tuesday it invested more than 12 million soles, about $4.2 million dollars, last year in 55 social projects located in the area that covers the Apurímac and Ene river valley’s, known as the VRAE.

The area includes 31 districts in the departments of Ayacucho, Junin, Huancavelica and Cusco, and is one of the country’s top producers of coca leaf – the raw material used to make cocaine – where police and military personnel are routinely confronted by remnants of the Maoist Shining Path insurgency that rely on drug trafficking for funding.

But Washington says the funding isn’t enough.

The projects financed by Foncodes included the building of educational centers, foot bridges, health offices and providing potable water, state news agency Andina reported.

The majority of the projects were developed in Huancavelica and Ayacucho. Twenty-seven projects requiring 5.9 million soles, about $2 million, were implemented in Huancavelica, while financing for 17 projects worth 3.5 million soles, approximately $1.2 million, was provided for Ayacucho.

Foncades’ social projects are part of a multi-sector plan developed by President Alan García’s administration aimed at strengthening the State’s presence in the VRAE to combat drug trafficking. It includes development projects combined with military and police components.

According to an October 2009 report by the Washington D.C.-based Council on Hemispheric Affairs, however, the plan has largely failed.

“Since its commencement, implementation of the somewhat controversial Plan VRAE has attracted a considerable amount of criticism due to its disorganized and weak structure,” COHA research associate Jorge Aguilar wrote. “Its major flaw lies in its management and how long it is taking for palpable results to materialize.”

Meanwhile, the U.S. State Department said in its 2010 International Narcotics Control Strategy Report released Monday that Peru’s government has not committed sufficient funding resources for its counternarcotics plan.

“The government of Peru’s law enforcement efforts focus on domestic crime within its major cities and provinces as well as issues regarding cocalero and (Shining Path) activities, placing less of an emphasis on dismantling and disrupting major drug trafficking organizations,” the State Department said.

“The Garcia administration gives high priority to achieving economic growth; relying heavily on U.S. counternarcotics assistance to maintain police academies and police bases, fund eradication efforts, provide aerial support, and fund operations and equipment for counternarcotics police.”

Peru is the world’s second largest manufacturer of cocaine, after Colombia. A report by the International Narcotics Control Board, however, said the country’s growing illicit cultivation of coca leaf – the raw material used to make cocaine – and consequent drug supply could surpass Colombia in five to 10 years.

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