Peru's Cocaine Shipments Rose 13 Percent in 2004 (Update2)

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Feb. 11 (Bloomberg) -- Peruvian drug traffickers sent abroad an estimated 160 tons of cocaine last year, a 13 percent increase from 2003, a sign U.S. aid isn't enough to control drug-financed terrorism, the state anti-drug agency Devida said.

At current growth rates, Peru's cocaine trade will double within four years, unless the United States and Europe boost funding to fight drug traffic, the agency's president, Nils Ericsson, said at a news conference today in Lima.

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An increase in the price of cocaleaf, the raw material for cocaine production, this year to $4 per kilo from $3.50 has spurred farmers to plant another 17,000 hectares of coca, taking the total in Peru to 48,600 hectares, Ericsson said. Coca plantations dropped by half to 86,300 hectares in Colombia, pushing up international prices, as a result of government efforts to eradicate production, Ericsson said.

``It's a question of market supply and demand,'' Fernando Rospigliosi, a political analyst at the Institute of Peruvian Studies and a former interior minister, said in a phone interview. ``Higher prices have also encouraged farmers to build dozens of cocaine laboratories all over the jungle.''

Bloomberg