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Gringo bashing may be on the wane in restructured South American economies. But the link between billionaire cocaine barons and leftist guerrillas means that multinational executives still face deadly competition.

Is Colombia the next Lebanon? Or Peru? Continuing our series on international terrorism directed at multinational business, You’re the Target author Ted Shackley concentrates on South America, to explain why newborn capitalism in Brazil and Chile hasn’t made it any safer for global executives.

The new southern-hemisphere economies are finding that the climb up from below the poverty line to even the lower-middle class is a slow process. And just as in the East European bloc, the free market can make things worse before better. This hasn’t weakened government commitment, but populist pressures can fan support for terrorist guerrilla groups bent on destroying nascent capitalism.

Then there’s the drug factor. The cocaine trade is still an economic linchpin in the region. The cocaine drug lords are the government in much of Colombia and the highlands of Peru, where the U.S. is getting into a shadow war with Golden Triangle overtones. The Medellin cartel of Colombia has no aspiration for economic growth, free trade, and better social conditions. Neither do their leftist guerrilla accomplices.

Peru is the worst basket-case in the Americas,” wrote Michael Brody in a Barron’s editorial published in April 1990. It got that way because of history and the havoc wrought by the increasingly powerful Senclero Luminoso, the Shining Path guerrilla movement. Kidnapping and murder have crippled the Peruvian economy, and in April 1990 Shining Path launched a new offensive, killing 178 people in two weeks.

Multinational kidnap coverage for executives serving in South America is a hush-hush subject. Warren P. Cooper, a senior vice president at Huggins Financial Services, an Ernst & Young practice, points out that terrorists will target companies known to carry kidnap, ransom, and extortion (KR&E) coverage. According to Walter Haenn, senior underwriting officer for American International Underwriters, the overseas insurance operation of American International Group, KR&E policies include a confidentiality clause, limiting those who know to CEOs and one or two senior risk managers.

But Haenn has seen steady growth in demand for AIG’s policies. That’s because terrorism in South America has a bigger goal than targeting individual multinational corporations. Political guerrillas and drug dealers have banded together to destabilize entire governments. Narcoterrorism dominates and it still does what it wants and that includes raising the death toll at Bogota‘s El Dorado airport almost daily.

But free-market thinking is gaining strength and powerful adherents. Across South America, leaders and businessmen are reading Hernando de Soto‘s eloquent recent explanation of how underground entrepreneurs are making it in Lima, The Other Path: The Invisible Revolution in the Third World. This is the road Chile is on, and its economic miracle is destined to set terrorism back more than General Pinochet ever did.

The most dangerous part of the world for an American in 1987 was Latin America. Forty-seven percent of all incidents aimed at the persons and property of U.S. citizens occurred there…. [To make the threat explicitly clear] the pro-Cuban Army of National Liberation (ELN) of Colombia literally captured the world’s attention in May 1988, when it kidnapped fourteen foreign diplomats and journalists, took them to an isolated mountain camp, and harangued them for a week about how the Colombian government was ruining the country by giving away its natural resources to foreign multinationals.


One of [Che] Guevara’s admirers, a Brazilian Communist named Carlos Marighella, came, in 1967, to the reluctant conclusion that there was a fatal flaw in Che’s operational plan. Although agreeing with Guevara that rural guerrilla warfare of the sort that he had just declared on Bolivia would be the decisive element in a revolutionary war, Marighella was convinced that for rural guerrilla warfare to succeed it must be supported by urban guerrillas whose mission would be to “harass, dishearten and confuse the enemy’s forces in the towns.” Because of this conviction, he broke with the Brazilian Communist Party, which still regarded such ideas as heresy, and became what we would now call a terrorist.

In 1969, shortly before his death in a shoot-out on a Sao Paulo street, Marighella published his Minimanual of the Urban Guerrilla…Today, twenty-one years after its publication, copies of the Minimanual are still to be found in terrorist safe houses from Toronto to Santiago…One of Marighella’s recommendations has been especially honored in the observance: “Kidnapping American personalities who live in Brazil, or who have come to visit here, is a most important form of protest against the penetration of U.S. imperialism into our country.”


Cuba had never abandoned its policy of implanting rural guerrilla movements in other countries…and Colombia, with its mountains and forests, looked like a good place to begin. Under [Fidel] Castro’s sheltering wing, the self-styled National Liberation Army (ELN) prospered and now numbers between 1,000 and 2,000 combatants. It practically dominates the Middle Magdalena Valley north of Bogota, which is unfortunate for Colombia because this is the oil patch. In 1986 the ELN carried out seventy attacks on pipelines and other oil company installations, killing 10 soldiers and 2 workers, kidnapping 22 Colombian and foreign technicians, and causing the loss of 100,000 barrels of petroleum. In just the first half of 1988, it bombed the main pipeline forty-four times, reducing Colombian oil production by 3.1 million barrels.

The second of Colombia‘s four principal rural guerrilla groups to take the field-the Revolutionary Armed Forces of Colombia (FARC)-is the child of the pro-Moscow Communist Party which stitched it together in 1966 from a rag-bag of radical trade unionists and brigands. Financing itself by robbing banks, kidnapping foreigners and Colombians for ransom, and levying contributions on coca growers, FARC is now solidly ensconced in northeastern, central, and western Colombia with an estimated strength of at least 9,000 combatants and armed supporters. FARC specializes in ambushing Army columns, and is currently the most active of all Colombian guerrilla groups.

The third of these groups is the People’s Liberation Army (EPL), which was formed in 1967 as the military wing of the Maoist Colombian Communist Party/MarxistLeninist. Its strength is estimated at between 750 and 1,000, and its area of operations is the high country west of Bogota. It also has aspirations to engage in urban guerrilla warfare. Raiding guerrilla safehouses in the city of Manizales in August 1988, Colombian military intelligence discovered plans to blow up a battalion headquarters, a police station, and several radio stations. Lists of names of people to be kidnapped were also confiscated.

The youngest, and in many ways the most interesting of the four Colombian guerrilla organizations, is the April 19 Movement, usually known as M-19. It was founded in 1974 by a group of doctors, lawyers, and military officers as the armed wing of a political party headed by a former dictator, and was given its name from the date of an election that the general lost. In 1979, defectors from FARC took M-19 over and turned it into a guerrilla movement. M-19’s strength is now estimated at about 1,000…According to documents captured by Colombian police in August 1988, M-19 was working on an ambitious plan aimed at seizing and holding territory in the southwest, northwest, and central areas of Colombia, and finally taking Bogota by 1990. But after clashes with Colombian army units, M-19 accepted a government amnesty.


Chile has been under attack for nearly as long as Colombia. Chile‘s urban guerrillas [now] call themselves the Manuel Rodriguez Patriotic Front (FPMR). This group was formed in 1983 by the youth wing of the Chilean Communist Party, but professes to be independent. Some of its members are believed to have received basic training in guerrilla tactics in Cuba, and to have then gone to Angola for field experience. The FPMR has carried out numerous bombing attacks, including two on U.S. diplomatic installations in Santiago, fire bombings of Mormon churches, and kidnappings of Chilean military personnel. Its strength is estimated at between 1,000 and 1,500….

There is no reason to suppose that the guerrillas will quietly fold their tents and fade away now that the Chilean military dictatorship has ended. Power for themselves is what they want, and opposition to Pinochet was only a pretext. The coalition of center and left parties that now runs Chile must live with the reality of continued violence.

General Augusto Pinochet, president of Chile, had spent the weekend of 6 and 7 September 1986 with his young grandson at a fortified Andean retreat called El Melocotón, and was returning to Santiago in a three-ton armored vehicle, preceded by three escort vehicles and followed by one backup car. At a place called El Cajon, twenty-eight guerrillas of the Manuel Rodriguez Patriotic Front set an ambush for him.

The window glass in Pinochet’s car shattered, but he pushed his grandson to the floor and covered him with his own body, suffering only a slight injury. Evidently the car’s body armor performed as advertised. Other cars in the motorcade suffered more damage. The lead car blew up, and five of Pinochet’s bodyguards died….

The guerrillas left the scene in cars disguised as vehicles belonging to the bodyguard force, complete with sirens and roof lights. On their way they encountered some military vehicles coming to the rescue in response to a radioed call for help. Deceived by the sirens and roof lights, the soldiers saluted the guerrillas and made way for them.


Dangerous as the Chilean and Colombian guerrillas are, they are surpassed by the Peruvian Shining Path (Sendero Luminoso), which the U.S. State Department ranked in its Patterns of Global Terrorism:1988 as the “most dangerous and unpredictable terrorist and insurgency group in Latin America.”

Shining Path was formed in the late 1960s by Professor Abimael Guzman Reynoso as a pro-Indian organization with a Maoist ideology, and began operations in 1980 by blowing up electric power pylons with dynamite sticks stolen from a mining company. In the ensuing eight years its militants killed up to 11,000 people and caused about five billion dollars worth of damage. They are believed to number fewer than 5,000.

Although originally a rural guerrilla group, Shining Path has become increasingly active in the cities. Its Lima branch, which once served only as a logistical support base, has begun to openly confront the police. In an interview published in July 1988 by a sympathetic newspaper, Prof. Guzman was quoted as saying: “Our process of the people’s war has led us toward the apex. Consequently, we have to prepare for insurrection, which will be the taking of the cities.” More and more Peruvians are taking him at his word. A poll taken in July 1988 showed that 15 percent of those questioned believed that Shining Path would eventually triumph.

Hoping to nudge the revolution in a more favorable direction, some students accepted Cuban help in 1983 to form an urban guerrilla group called Tupac Amaru Revolutionary Movement (MRTA). Most estimates agree they number about 500. MRTA militants have machine-gunned the U.S. embassy and bombed the residence of the Marine Guard and the U.S. consulate. Security sources say that their bombs are more sophisticated than those of Shining Path, which may reflect the aid they are reputed to be receiving from Cuba and Libya. In November 1987, they embarked on rural guerrilla warfare, seizing and holding a jungle village in the central department of San Martin. True to their Cuban mentors, they called this area their “Sierra Maestra.”


Kidnapping is commonplace in Colombia. Left-wing guerrillas do it, right-wing terrorists do it, and so do criminals. Frequently, it is hard to tell the difference between them. Nicolas Escobar Soto, vice president and manager of Texaco, was driving alone through a residential area north of Bogota in May 1978, when the road was blocked by another car. Four men and two women jumped out, forced Escobar into their car, and drove off. Colombian police later said no known terrorist group had claimed responsibility and concluded that it was the work of a gang of criminals. By January 1979, the police had located the hideout where Escobar was being held. When they stormed it, the kidnappers shot Escobar twice in the heart.

Texaco’s production director, Kenneth Bishop, was kidnapped in much the same way and in the same area in March 1983, the main difference being that the two bodyguards accompanying him were shot dead. He was released five weeks later, after payment of what family sources said was a ransom of several hundred thousand dollars. Texaco declined comment.


In true pirate fashion, the M-19 in 1981 kidnapped the daughter of one of Medellin‘s leading cocaine exporters. This led first to a war between drug traffickers and terrorists, and then to an alliance which has now become so widespread as to have inspired the name “Narcoterrorism.”

FARC, too, has gotten into the narcotics business. In July 1988, the Colombian Army discovered a huge cocaine production and distribution complex in the jungle near the Venezuelan border, operated by the FARC “general staff.” Records showed that the complex sent a daily shipment of one and one-half tons of pure cocaine to Cuba and Nicaragua.

The Colombian guerrilla organizations mostly see eye-to-eye with one another in ideological matters, and so are generally willing to cooperate, not only in sharing the take from narcotics traffic, but in their military activities as well….The two Peruvian guerrilla groups, Shining Path and Tupac Amaru, do not see eye-to-eye ideologically. Instead of joining forces and coming to an amicable agreement with the coca growers in the upper Huallaga valley, they fought for the right to control the traffic. By the beginning of 1987, Shining Path had won and was taking an estimated $30 million per year from the valley.

Here is more food for thought. Suppose the urban gangs that are now killing each other in Miami, New York, Washington, Chicago, and Los Angeles over the right to distribute cocaine in their respective turfs were to link up with international terrorism. A far-out idea? Not at all. Their major sources of supply in Colombia are already in partnership with terrorist/guerrilla organizations, so a ready-made channel of control already exists.

Ramon Milian Rodriguez, in his testimony before a Senate investigating committee, warned against this possibility, and he is one whose warnings should be taken seriously. Before his conviction for money-laundering, he was a trusted adviser to the Medellin cartel…[Alsol according to his testimony, he handed the cocaine barons a copy of Carlos Marighella’s Minimanual of the Urban Guerrilla and told them to know their enemy. n

Theodore G. Shackley, former C.I.A. associate deputy director of operations, is CEO of Research Associates International, and with his colleagues R.A. Finney and R.L. Oatman, specializes in threat assessment and international executive protection. For security reasons, the authors declined to be photographed

About theodore g. shackley and r.a. finney and r.l. oatman