August 7, 2006

Colombia’s Uribe seeks peace in second term

By Patrick Markey

BOGOTA, Colombia (Reuters) - Colombian President Alvaro
Uribe began a second term on Monday promising to seek peace and
more social investment without sacrificing the gains won
through his hard-line stance against leftist guerrillas.

In a region that has seen a rise of anti-U.S. sentiment,
Uribe is a key Washington ally who won re-election in May after
voters applauded him for reducing kidnappings and violence in a
four-decade conflict with Marxist FARC rebels.

Thousands of troops patrolled the streets on Monday while
helicopters clattered over Bogota, where four years ago rebel
rocket attacks near the presidential palace killed 21 people
during Uribe's first inauguration ceremony.

"We strived without fear in our actions to secure peace.
Fear will not stop us negotiating peace. I confess my concern
is something else: The risk of failing to get peace and
slipping in security," Uribe said in his speech to Congress.

The president, who has come under fire for failing to
alleviate poverty, said his new government would balance its
free-market economic policies with improvements in basic
education, health and housing programs.

Eleven Latin American presidents and other dignitaries
attended the swearing-in ceremony, including U.S. Treasury
Secretary Henry Paulson, Venezuelan Vice President Jose Vicente
Rangel and Spain's Crown Prince Felipe de Borbon.

Police on Monday said they had deactivated a car bomb
outside the capital. At least 32 people, mostly soldiers and
police, were killed in FARC attacks in the week before Uribe
assumed his second mandate.

Thousands are killed or displaced each year by the violence
fueled by the country's huge cocaine trade. Colombia remains
the world's No. 1 producer of the illegal drug despite millions
of dollars in U.S. anti-narcotics aid.

Analysts say the U.S.-educated lawyer must now maintain his
security success by defeating or seeking peace talks with FARC,
which is waging the region's oldest insurgency, while balancing
demands for more social spending with fiscal reforms.

"If he wants to maintain military spending as it is, how is
he going to find the resources for more social spending? If he
wants to maintain that spending, what about the fiscal
deficit," said Mauricio Romero of Bogota's Rosario University.


A Wall Street favorite, the Colombian leader must also push
tax reforms through Congress that officials say will boost
investment, and Uribe must also revamp payments to local
authorities and restructure a chaotic pension system.

Security is still paramount. Uribe's supporters praise him
for reducing murders and crime, particularly in cities, and
sending troops to open highways once controlled by guerrillas.
But armed groups hold swathes of rural Colombia.

During his first term Uribe promised to smash the
17,000-strong FARC guerrillas, but after his re-election he has
said he could be willing to open to talks with the group, which
Washington brands as drug-traffickers and terrorists.

FARC rebel leaders demand an end to anti-insurgent
operations before any negotiations over peace or the release of
scores of kidnapped victims, including police, politicians and
three U.S. contract workers, still held in jungle camps.

Around 30,000 members of the right-wing paramilitary United
Self-Defense Forces of Colombia or AUC have also handed in
their weapons under a peace plan that allows them reduced
prison terms for crimes.

But Uribe has been accused of being too lenient on the
paramilitary leaders, who critics say have been allowed to keep
their cocaine trafficking networks intact. A recent government
report said hundreds of demobilized fighters had left the
program to form new criminal gangs.

(Additional reporting by Luis Jaime Acosta)