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Cablegate: Rio de Janeiro Pol/Econ Round-Up, July/August 2008

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RR RUEHRG
DE RUEHRI #0239/01 2531859
ZNR UUUUU ZZH
R 091859Z SEP 08
FM AMCONSUL RIO DE JANEIRO
TO RUEHC/SECSTATE WASHDC 4607
INFO RUEHBR/AMEMBASSY BRASILIA 0944
RUEHSO/AMCONSUL SAO PAULO 5178
RUEHRG/AMCONSUL RECIFE 3449

UNCLAS SECTION 01 OF 02 RIO DE JANEIRO 000239


SIPDIS

E.O. 12958: N/A
TAGS: ENRG EPET EAIR PGOV PHUM KCRM KCOR KPLS SNAR SOCI BR
SUBJECT: Rio de Janeiro Pol/Econ Round-Up, July/August 2008

Summary
-------

1. The following are highlights of Political/Economic activity in
Rio de Janeiro's reporting district during the months of July-August
2008.

- GOB Considers Privatizing Rio International Airport
- Armed Forces Deployed to Rio for Municipal Elections
- Former Rio Governors Indicted for Corruption
- Rio de Janeiro Police Most Lethal in World
- Militia Violence on the Rise
- New Synthetic Drug Seized in Rio de Janeiro


GOB Considers Privatizing Rio International Airport
--------------------------------------------- ------

2. In a move aimed at making Rio's bid to host the 2016 Olympics
more attractive, Governor Cabral's office released a statement
saying that President Lula approved a proposal for the privatization
of Rio's international airport, which should be finalized in the
next few weeks. According to Brazilian Government Airport
Administration (INFAERO) President Srgio Gaudenzi, the Brazilian
National Development Bank (BNDES) is already preparing a study on
the most viable way to do this. Some envision a model similar to
that adopted by Petrobras, which has shares in the market, but is
still controlled by the GOB. The estimated GOB 2009 budget for
Rio's airport is approximately USD 29.6 million.

Armed Forces Deployed to Rio for Municipal Elections
--------------------------------------------- -------

3. On September 4, Defense Minister Nelson Jobim announced the
deployment of the Brazilian military to Rio de Janeiro state in
advance of municipal elections to supplement local security forces.
Jobim announced that the Army and Navy would, in coordination with
state and federal police, be stationed in 24 at-risk communities
which have been identified by the Regional Electoral Court (TRE).
The TRE is worried that local criminal organizations are
intimidating voters to support certain candidates. TRE President
Roberto Wider has stated that military and law enforcement officers
will be armed and will defend themselves if needed to ensure the
democratic process.

Former Rio Governors Indicted for Corruption
--------------------------------------------

4. After two years of investigation, the Rio de Janeiro State Public
Attorney indicted former Governors of Rio de Janeiro Rosinha
Garotinho, and her husband, Anthony Garotinho, along with 21 other
associates on charges of corruption and embezzlement. The Garotinhos
are accused of misappropriating an estimated USD 40 million in
government funds from the State Health Secretariat during their
mandates through NGOs and evangelical churches. The money was
transferred into personal bank accounts. The matter has been moved
to the Federal Supreme Court (STF), which has not yet set a date for
trial.

Rio de Janeiro Police Most Lethal in World
------------------------------------------

5. A recent report by the Institute for Public Security of the state
of Rio de Janeiro (ISP) shows that Rio de Janeiro police on average
kill four people per day. This rate is a 12 percent increase over
2007, making Rio's police force the most lethal in the world. In
response, Rio de Janeiro State Public Secretary Jos Beltrame
announced that he is replacing the current automatic weapons used by
the police with less lethal weapons.

Militia Violence on the Rise
----------------------------

6. A militia group called the "Justice League" is charged with
murdering seven residents in the Barbante favela, a poor community
on Rio's west side, on August 19. According to the Rio State
Secretariat for Public Security, 17 members of the militia posing as
drug traffickers entered the community and shot people at random.
The attack, believed to be orchestrated by former Military Police
officer Luciano Guinancio, was aimed at generating community support
for the militia to protect against violent drug traffickers.
Besides Guinncio, three other current Military Police officers are
suspected of involvement. Guinancio is the son of current Rio de
Janeiro City Council member Jeronimo Guimaraes (PMDB Party), who has
been in jail since December 2007 for organizing illegal militia
activity in the same area. (Note: Militia groups often start as
off-duty and former law enforcement officers taking community
policing into their own hands. However, many militias become as bad
as the drug traffickers in terms of intimidating residents and
conducting illegal activity.)

RIO DE JAN 00000239 002 OF 002

New Synthetic Drug Seized in Rio de Janeiro
-------------------------------------------

7. Law enforcement authorities announced that locally-produced
liquid ecstasy (GHB) has recently been seized in Rio de Janeiro's
slums, marking the first known incidence of the drug being
manufactured locally in Rio. The criminal gang "Red Command" is
believed to be behind production and distribution of GHB in Rio de
Janeiro, with average street prices reported at around USD 20 per 20
mL individual dose. Synthetic drugs are highly popular among middle
and lower class residents in Rio de Janeiro, but to date such drugs
have largely been brought in illegally from Europe.

MARTINEZ

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