U.S. Withholds Aid to Pressure Peru Into Drug Fight : Narcotics: Andean nation must ensure military’s support, State Department says. Report is upbeat about progress elsewhere.

Faced with a potentially serious desertion in the war on drugs, the Bush Administration announced Friday that it is holding up more than $90 million in aid to Peru until its government can ensure its military will stand behind the fight against narcotics.

“The Peruvian military did not generally support Peruvian law enforcement units in counternarcotics activities” in 1990, the State Department said in a report to Congress on progress in the worldwide drug war. “As in 1989, serious military and police corruption (in Peru) impeded efforts to expand counternarcotics missions.”

The unusual step of withholding, at least temporarily, $60 million in economic aid and $34 million military aid for drug-fighting activities was seen as a means to exert pressure on the fragile government of Peruvian President Alberto Fujimori to fully enlist his military in the anti-drug effort. Peru remains eligible for a range of other types of foreign aid.

Last December, the U.S. Drug Enforcement Administration temporarily suspended operations in Peru after Peruvian soldiers blocked Peuvian police and DEA agents from raiding a warehouse suspected of housing a large quantity of cocaine.

Despite the problems in Peru, the International Narcotics Control Strategy Report filed by the State Department generally was upbeat, declaring that worldwide production of opium and marijuana dropped in 1990, and that production of cocaine at least stabilized.

The results were in marked contrast to figures reported a year ago, when the State Department said that drug production had soared to record levels.

“It’s a good story this year,” said Melvyn Levitsky, assistant secretary of state for international narcotics affairs. “But there are still a lot of problems and there are still a lot of drugs.”

The Andean nations of South America--Peru, Colombia, Bolivia--produce nearly all of the world’s cocaine and receive special attention under a 1990 law that establishes special conditions they must meet before receiving U.S. economic and military aid to combat drugs.

The President must assert that each nation is taking steps to reduce the flow of cocaine to the United States, that its armed forces and police are not engaged in a pattern of human rights violations, and that the government has control over police and military anti-drug operations.

In its report, the State Department said that, despite some problems, Colombia and Bolivia have met those conditions, while Peru so far has not. In an interview, Levitsky said the United States has decided to wait for the signing of a formal accord before releasing the $94 million in economic and military aid for the drug war.

However, Peru will continue to receive other foreign aid, including $19 million specifically set aside to equip and finance anti-drug operations by police.

In a separate and broader series of progress assessments that affect virtually all categories of foreign aid except emergency relief, the Administration asserted that all three Andean nations have undertaken adequate steps to stamp out drug production and trafficking.

Only four countries--Afghanistan, Burma, Iran and Syria--were cited for inadequate drug-fighting efforts and will be barred from receiving the aid under the broader assessments. All four also were cited in last year’s report.

Of Syria, a member of the military coalition that helped defeat Iraq, the State Department said: “Members of the Syrian military continue to control the Bekaa Valley of Lebanon, where we believe they facilitate and profit from drug trafficking in this key production area. . . . There have been no actions taken by the Syrian Arab Republic government to indicate a serious desire to cooperate . . . or take steps on its own against drug trafficking.”

Closer to home, the report said that in the year since American military forces overthrew the government of Panamanian dictator Manuel A. Noriega, money laundering in that Central American country remains a serious problem. In addition, the State Department said Panama’s “criminal justice system is overburdened and in chaos, with a backlog of over 17,000 criminal cases--including drug cases.”

The report said that worldwide opium production dropped 10% in 1990, from 3.9 to 3.5 million metric tons. The largest opium producing nation by far is Burma, which was reported to have produced 2.5 million metric tons last year.

Worldwide marijuana production was reported to have dropped from 25.6 to 23.6 million metric tons. Mexico remains the largest producer of marijuana, according to the State Department, with a crop of 18 million metric tons.

Estimates of cocaine production are more complicated. Under one method, worldwide cocaine production reportedly dropped from 234.9 million metric tons in 1989 to 225.9 million tons last year. However, another method, which postulates a higher yield of refined cocaine for each coca plant, indicated that cocaine production could have slightly increased in 1990--from 310.7 to 337.1 million metric tons.