ECUADOR: "NARCOSCANDAL" THREATENS GOVERNMENT OF PRESIDENT LUCIO GUTIERREZ.

Ecuadoran President Lucio Gutierrez is facing the most serious challenge of his 11-month presidency, with a scandal that reportedly links drug trafficking and members of his administration, including the vice president. The scandal, coming atop widespread discontent with the administration, has analysts questioning how long Gutierrez will be able to hold on to the presidency.

Gutierrez's relations with the Indians, social movements, and leftist parties that were pivotal in his election have ruptured or become seriously strained, and he has spent most of his presidency dealing with accusations of nepotism, arms trafficking, and now alleged drug money in his campaign.

The president's credibility rating, already low, dropped even more--to barely 15%--following the outbreak of this latest scandal.

Arrest of former governor unleashes scandal

The local media reported on Nov. 11 that Ecuadoran businessman Cesar Fernandez Cevallos, arrested in late October in a drug-trafficking case, had supported Gutierrez's campaign for the 2002 election. He was governor of Manabi province during the administration of President Sixto Duran Ballen (1992-1996), and had been considered an upstanding and influential businessman.

The police have linked Fernandez to the international drug cartels in Sinaloa, Mexico, and Cali, Colombia. He was captured, along with 13 others, in Operacion Aniversario, during which the police seized a half ton of cocaine.

Vice President Alfredo Palacio admitted that, in the runoff campaign, Fernandez "was present at some functions" for Gutierrez's Partido Sociedad Patriotica 21 de Enero (PSP) in Manabi.

But Gutierrez denied that Fernandez had contributed money to his campaign, and he threatened to sue anyone who tried to tie him with drug dealers. "Sr. Cesar Fernandez did not contribute a single cent to the campaign, I never met him," Gutierrez said during a press conference before he left for the Ibero-American summit in Bolivia.

The day before, Izquierda Democratica (ID) Deputy Carlos Gonzalez had asked the legislature to investigate whether Fernandez financed the Gutierrez campaign. He said that, under Ecuadoran law, any government officials whose campaigns were financed with drug money must resign.

The Comision de Fiscalizacion of the legislature has begun an investigation and is supposed to present its findings within a month. The Comision has asked the Tribunal Supremo Electoral (TSE) and the PSP to turn over financial records...

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