On May 28, 2006 Colombia’s President Alvaro Uribe secured a second four-year presidential term, gaining a better than expected 62 percent of the popular vote. Uribe’s relationship with the Bush administration and the Republican controlled Congress was intact and it appeared his administration was near to obtaining a historic free trade agreement with the United States.
Paramilitary forces belonging to the United Self Defense Forces of Colombia had begun limited disarmament proceedings under a general amnesty program and were being reintegrated into Colombian society. In addition the Colombian economy was responding to increased security in major urban centers, attracting impressive amounts of foreign direct investment and capital inflows, while real estate prices tripled in some areas of Bogota and Medellin.
Nearly one-year later Colombia’s economic regeneration, paramilitary de-mobilization and counterinsurgency program continues to attract foreign investors. Uribe has maintained an impressive 60 percent approval rating, but his relationship with the US has reached an impasse that could undermine his remaining years in office.
US-Colombia Free Trade Deal
The newly elected Democratic controlled US Congress appears reluctant to approve a free trade deal with the Colombian government due to the Colombian government’s lackluster commitment to arresting and convicting paramilitaries responsible for the murder of trade unionists during the 1990s. More than 2,000 unsolved killings of trade unionists were reported between 1991 and 2006, although this number is likely considerably higher. Only 1.8 percent of these cases have resulted in a conviction.
The most toublesome allegation against the Uribe administration’s acquiescence in trade unionist assassinations are claims that Jorge Noguera, who headed a civilian intelligence agency from 2002-2005, provided paramilitary units with lists of registered trade unionists that were receiving government protection.
Moreover, Uribe’s rumored past relationships with paramilitary forces has caused concern within the US Congress. Accusations in the past three months point to the infiltration of Colombian politics by longtime paramilitary supporters and former members. On May 14, 2007, Colombian authorities ordered the arrest of 19 politicians and businessmen, including five Congressmen, for alleged links to the AUC. They join eight other legislators that have already been detained by the authorities, including two senators, a representative, a former congresswoman from Sucre province, and Senator Alvaro Araújo (brother of Uribe’s former Foreign Minister María Consuelo Araújo).
Finally, AUC paramilitary leader Salvatore Mancuso, has publicly accused Francisco Santos, Uribe’s vice-president, and Juan Manuel Santos, Uribe’s defense minister, of inciting paramilitary activities throughout the 1990s. Mancuso has given no evidence to validate his claims.
Despite Concerns Investors Still Flocking
Since taking office Uribe has sought to nurture investor confidence within the state, partially achieved through the implementation of security in urban areas. Murder rates and abductions have significantly declined in both Bogota and Medellin – Medillin’s murder rate is 28 per 100,000, lower than both Baltimore and Washington DC. In turn foreign and domestic investors have returned to Colombia’s cities, developing small businesses, residential complexes, and heavy-industrial facilities.
Colombia’s economy stands at US $130 billion and is growing at 6.8 percent a year, the fastest since 1978 – averaging two points more than its closest Latin American competitor. Inflationary pressure has declined, and is currently 6 percent, down 12 points since Uribe took office in 2002. Unemployment remains a concern, hovering around 13 percent, although this too has declined since 2002. Colombia’s peso rose to a seven-year high on May 14, 2007, following increased speculation that higher interest rates and an expanding economy would continue to attract foreign investment.
During an interview with BusinessWeek Uribe emphasized his commitment to the economy, saying, “The state is the most important enterprise and the public is like a universe of shareholders.”
US-Colombia Relationship Essential for Both States
Despite increasing foreign investment and capital inflows from investors outside the US, the rejection of the US-Colombia free trade agreement would be a setback to Colombia’s economic growth and the longstanding US-Colombia relationship. Although Uribe’s commitment to apprehending paramilitary leaders and corrupt political leaders is imperative to any future relationship between the US and Colombia, isolating Uribe’s administration in an increasingly hostile region would negatively impact both the US economy and US foreign policy goals.
In addition, US isolation of Uribe could deter foreign investment in Colombia, degrading continued economic growth, an important component of Uribe’s counterinsurgency campaign.
Uribe’s Next Move
In the coming weeks Uribe’s government will seek to detain paramilitaries and government personnel implicated in the assassination of trade unionists to placate US congressional fears. Several high-level arrests and possible convictions will likely encourage the US Congress to approve the US-Colombia free trade deal.
If Uribe pursues high-level paramilitary leaders associated with trade unionist assassinations we anticipate limited paramilitary remobilization directed against the Colombian government. To dissipate the AUC remobilization threat while simultaneously increasing near-term chances of the US Congress approving the free trade agreement, Colombian security forces will likely arrest mid-level commanders implicated in attacks on trade unionists.
The US Congress will refrain from passing any free trade agreement until it’s satisfied with Uribe’s commitment to eliminating paramilitary influence within Colombia’s trade union sector and government.
