MS Risk Blog

An Unconventional Warfare – Cyber bombs

A conflict which has lasted over five years; dismounted the infrastructures of a country set the entire surviving population to seek asylum in neighbors’ states: the Syrian civil-war. The perfect stage to allow terrorists and extremists to enforce their plans and gain territories. Syria is not the only battlefield of this unbalanced amorphous and revised war on terror. North Iraq, Southeastern Turkey and on a broader spectrum the whole of Europe remains a potential target. A conflict where superpowers as the US and Russia played a major role leading to a ceasefire and alleged peace talks in Ginevra; a conflict where actors, structures and outcomes are yet to be fully unveiled.

This conflict is another historical landmark for many foreign policies; it reshaped the approach to terrorism and justice; showed the world a climate of desperation and fear; cruelty and loss of lives have filled the daily newspapers. Europe has worked on resolving the collateral effect of migrations and has faced attacks within its capitals; other players have tried to eradicate ISIS. No winners; only an apparent and fragile ceasefire.

From any “problem solving” point of view the first step of the analysis is to acknowledge the problem; identify the causes beginning by minimizing the effects. Who is ISIS?

Before describing the organization we should consider the so widely used term “Terrorism”. Historically the term refers to the unlawful use of violence towards civilian’s targets in a desperate attempt to enforce political goals. The rise of ISIS, the Islamic State of Iraq and Syria or Islamic State of Iraq and al-Sham began in 2004 as al Qaeda in Iraq (AQI). It was initially an ally of Osama bin Laden’s al Qaeda and both were radical anti-Western militant groups devoted to establishing an independent Islamic state in the region. AQI was weakened in Iraq in 2007 as a result of what is known as the Sunni Awakening, when a large alliance of Iraqi Sunni tribes, supported by the US, fought against the jihadist group. AQI saw an opportunity to regain its power and expand its ranks in the Syrian conflict that started in 2011, moving into Syria from Iraq. By 2013, al-Baghdadi had spread his group’s influence back into Iraq and changed the group’s name to ISIS. It disowned the group in early 2014 proving to be more brutal and more effective at controlling seized territories.

While ISIL has not been able to seize ground in the past several months, that hasn’t precluded them from conducting terrorist attacks, and it hasn’t precluded them from conducting operations that are more akin to guerrilla operations than the conventional operations that we saw when they were seizing territory. The organization understood the value of pushing out content, specifically videos of atrocities, into the world. Therefore, they could recruit very brutal young men to come and join their struggle. As the organization evolved, it made media very central to its ideology and strategy. ISIS had harnessed the power of the “information arena” to propagate its ideology, recruit, move money and coordinate activities. The question arise naturally: “What can be done?”

A top Pentagon official reported that the US is hitting ISIS with “cyber bombs” as part of its new arsenal of tactics being deployed against the terrorist group. The cyber effort is focused primarily on ISIS terrorists in Syria and that the goal is to overload their network so that they cannot function. An attack of this magnitude can interrupt the group’s ability to command and control forces. Similar principle was applied over the power and water disruptions in the middle of a two-week truce between government forces and certain militant groups. Disruption of critical infrastructure was used in order to gain an advantage over the group. Moreover the Islamic State is clearly frightened by the outflow of refugees. A lot of media have been created excoriating those who flee from these territories. By taking advantage of those refugees a powerful tool could be created in order to tell their stories to the world.

The humanitarian issues, the fallout, the civil war, the core issues have not been addressed yet. So far the military intervention and the coalition of multiple air strikes, carried out by Russia and US, have diminished the capabilities of the group; however there is so much more to do and the future remains uncertain. It is highly likely that ISIS will not cease to exist in the near-medium term; their strategy, tactics and objectives are likely to remain unaffected. The struggle in the region and the level of threat to Europe are still primary concerns and subjects of ongoing discussions.

Boko Haram Rejects Suggestions of Surrendering in Latest Video

Boko Haram released a new video on Friday, 1 April denying any suggestions that it would surrender. The latest video comes just over a week after the group’s leader, Abubakar Shekau, appeared in a rare message looking dejected and frail.

Shekau, who was not seen on camera for more than a year, released an unverified video late last month, stating that his time in charge of the Nigerian jihadist group may be coming to an end. If the video indeed depicts Shekau, he appears thin and listless, delivering his message without his trademark fiery rhetoric. While last month’s video prompted speculation from the Nigerian army that the Islamist group was on the verge of collapse in the face of a sustained military counter-insurgency, in Friday’s newly released video, Boko Haram maintained that it was a potent fighting force, with fighters posing with AK-47s in front of Toyota Hilux pick-up trucks and a lorry mounted with a military cannon. In the video, which was posted on YouTube, an unidentified masked man wearing camouflage said in a prepared script in Hausa that “you should know that there is no truce, there is no negotiations, there is no surrender…This war between us will not stop.” The masked man in the video also stated the Shekau was still the head of the “West African wing,” likening Boko Haram to the Islamist insurgencies in Iraq, Libya and Syria. The video, which was markedly better quality than Shekau’s and which included Arabic subtitles, featured nine masked Boko Haram fighters standing on sandy ground in an undisclosed desert location. It remains unclear if the masked people in the video include Boko Haram’s leader.

Mossack Fonseca’s Panama Offices Raided by Police

Police in Panama have raided the offices of the firm at the centre of the Panama Papers revelations. Organized crime police surrounded Mossack Fonseca’s headquarters in Panama City on Tuesday while prosecutors entered the offices to search for documents. According to the attorney general’s office the aim of the operation had been to obtain documentation linked to the information published in news articles that establish the use of the firm in illicit activities.

The unprecedented leak of 11.5 million files has caused disorder around the world. There are links to 12 current or former heads of state and government in the data. More than 60 relatives and associates of heads of state and other politicians are also implicated.

The files have revealed a suspected billion-dollar money laundering ring involving close associates of Russia’s President Vladimir Putin. Also mentioned in the documents leaked are the brother-in-law of China’s President Xi Jinping, Ukraine President Petro Poroshenko, Argentina President Mauricio Macri, the father of UK Prime Minister David Cameron and three of the children of Pakistan’s Prime Minister Nawaz Sharif.

Officials in France, Germany, Austria and South Korea have begun investigations into possible malfeasance, from money laundering to tax evasion. France’s finance minister, Michel Sapin, told Parliament the government was putting Panama back on a blacklist of havens for tax evaders.

On 4 April, the president of the Chilean branch of Transparency International resigned after documents from the Panamanian law firm showed he was linked to at least five offshore companies. While he is not accused of illegal activity, the leaks called into question his post at Transparency International, an organization that seeks to monitor and root out corporate and political corruption worldwide.

On 5 April, Iceland’s Prime Minister Sigmundur Gunnlaugsson stepped down after leaked documents revealed he purchased an offshore company called Wintris in 2007 with his wife but failed to declare this as an interest when he entered parliament in 2009. He sold his 50% of Wintris to his wife for 1 dollar eight months later. A document signed by his wife in 2015 shows the company was used to invest millions of dollars which they had inherited. Gunnlaugsson is accused of concealing millions of dollars worth of family assets. Gunnlaugsson said no rules were broken and denied that he or his wife had benefited financially from his conduct.

Following the leak of information from Mossack Fonseca’s, Panama announced it would form an independent commission to review the country’s financial practises. President Juan Carlos Varela said the commission would evaluate the current practises and propose the adoption of measures to strengthen the transparency of the financial and legal systems.

Liberia Records New Ebola Death and Second Case

Health officials reported on Friday, 1 April that a woman has died of Ebola in Liberia, months after the West African country was declared free of the deadly disease. The announcement also comes weeks after neighbouring Guinea also recorded a new flare-up. Just days later, on 3 April, officials confirmed that the woman’s five-year-old son has tested positive for Ebola.

According to a senior health ministry official, “a young lady in her early thirties died of Ebola yesterday at the Redemption Hospital,” adding that the government was preparing to release a statement on the new case. A hospital worker also confirmed that the woman had tested positive for the disease and died on Thursday, 31 March. Authorities are now checking everyone the woman was in contact with and ten health care workers from the hospital where the woman died are currently under observation. A source has disclosed that there are strong indications that the woman came from Guinea where they border was closed, adding that the woman had travelled with three of her children.

The new cases are a setback for Liberia, which had been declared free from transmission for a third time on 14 January. The region also continues to see a number of small flare-ups even after countries have received the all-clear. Liberia was first declared free of the disease in May 2015, however new cases emerged twice, effectively forcing officials to rese the clock in a nation where more than 4,800 people have died from the deadly virus. Last week, the World Health Organization (WHO) announced that Ebola was no longer an international health emergency, warning however that flare-ups, at decreasing frequency, were expected. Last month Guinea documented a series of new infections, highlighting the difficulty in stamping out the lingering epidemic. There are currently no known cases of Ebola in Sierra Leone, however in early April, the authorities announced that they have increased security measures along with screenings and surveillance points at all border crossings with Guinea.

More than 11,300 people died over the past two years in the world’s worst Ebola epidemic on record, with nearly all of them dying in Guinea, Liberia and Sierra Leone.

Increase in coca cultivation in Colombia signals changing trends in post-conflict political economy

When it comes to Colombia and the US’ bilateral relationship, coca cultivation remains a hot – and controversial –  topic. Indeed, one of the main objectives of Plan Colombia was to reduce coca cultivation, often with methods that were opposed by local communities. Washington continues to closely monitor the crops cultivated in Colombia and if there are any noticeable changes, the US tends to be pretty vocal on the topic. Therefore, it is little surprise that the recent attention gained in national and international media around the increasing number of hectares dedicated to coca cultivation was sparked by a statement made by the US Ambassador in March. However, it is necessary to analyse what the recent uptick in production tells us about the changing patterns of illicit economic activity in Colombia, particularly in the context of the move towards a post-conflict environment, following the ongoing peace process between the government and guerrilla groups (FARC and the ELN).

According to the US Embassy’s report, the figures produced by the Whitehouse’s National Office on the Control of Drugs showed that between 2013-2015 the number of hectares of coca cultivated increased by 42%. This means that despite the ongoing well-funded fight against drugs, Colombia has once again become again the number one cocaine producer in the world.

While these numbers could point to failing policies in the fight against drug cultivation, closer analysis underlines that the rise has more to do with changing patterns in the areas being cultivated. Since May 2015 the Colombian government has prohibited the use of spraying glyphosate to eradicate crops, and has instead favoured other methods – likely less effective, if less harmful – such as manual eradication. The reason behind the reforms are primarily driven by the noted effects of glyphosate on the health of those living in such areas, and the government’s changing strategy to tackle illicit cultivation in the country by encouraging investment, rather than further alienating local populations. What the figures do tell us are that the areas where cultivation has increased are likely to present some of the most pressing challenges in the coming years, because beyond coca they are breeding grounds for other illicit economic activities.

Since October 2015 the new anti-drugs policy has reformed the previous strategy on crop eradication. One of the six key points includes substitution cultivation and voluntary eradication to incentivise planting other types of crops and productive initiatives. As our analysis on the passing of the Law on zones of rural, economic and social development (Zidres) outlined, part of the post-conflict strategy is to develop agricultural and agroindustrial initiatives in the country. Many in rural areas such as North Santander region or Orinoquía -where anti-drug policies are being implemented- are, at the same time, places of interest for economic agroindustrial projects. The potential connection between these new projects and drug eradication methods is likely to be a big concern for future investors and the government.

According to the figures released by the UN Office on Drugs and Crime in 2015, during the year 2014 most of the coca cultivation areas were in the south of the country, in particular in Caquetá, Cauca, Nariño, Putumayo and Catatumbo. The report also underlines that coca cultivation remains dominant in the regions it has traditionally thrived, rather than spreading to other areas. However, these areas are now also home to other illicit economic activities – most notably, and of likely concern to international companies in the extractives sector, illegal mining. Moreover, the growing number of hectares used for coca cultivation are primarily concentrated in areas of increased activities of BACRIM (organised crime groups), guerrillas and other organised crime groups.

Coca cultivation has directly aided guerrilla groups, paramilitaries and other armed groups in financing their activities in Colombia in recent decades. The continued prevalence of coca underlines that despite the ongoing peace process taking place between the government and guerrilla groups, narco-trafficking and other illicit activities are likely to remain a key challenge in many regions.

In particular, it should be noted that:

• While the new policies tackling drug cultivation can be considered a triumph for many local communities in the south of the country, who had suffered greatly from the previous eradication methods, the increase in cultivation alongside other illicit activities will continue to directly affect the local social and environmental climate (eg illegal mining and logging). Moreover, the heavy presence of armed groups in the south, alongside the plans for reconstruction and development in these regions, points to the potential for armed conflict to continue at a localised level, even if Colombia is technically entering into a “post-conflict” state.
• The change in anti-drug policy also opens up the possibility to invest in the areas where coca is grown. Such investment is likely to pose significant challenges when assessing narco-trafficking routes in the country, the demobilisation of the FARC, the role that illegal mining now plays in areas with high levels of coca cultivation and in particular the change in dynamics between local and national institutions,  armed groups and local populations in each region. A few years ago former president Alvaro Uribe attempted to increase the presence of the state in such areas where coca was cultivated and control local populations. However, the measures saw coca cultivation move to increasingly remote rural areas where there was little state presence and armed groups moved, expanding narco-trafficking routes. This serves as an example of how trying to impose state control in rural areas, without negotiating with armed groups with a presence in the region, can have unintended implications. In particular, with the likely demobilisation of FARC, these efforts may enable the expansion of the areas of influence of other armed groups.

WHAT TO LOOK FOR

The Colombian government’s push to develop agroindustrial projects, alongside substituting coca for other productive crops, is aimed at tackling the social and local economic development issues in regions where armed groups have historically been their most prolific. However, the model could proffer explosive political and social consequences, when combining the development projects, alongside anti-drug policies, and the continued presence of demobilised guerrillas and other organised criminal groups in the same region.

Rafael Pardo, the Minister for post-conflict has outlined that substitution cultivation plans will be inherent with the peace policies that are being implemented in the country. However, the increase in coca cultivation outlines the continued threat that organised criminal activity will have for future investors in these regions, even if the country is no longer in a state of armed conflict. Importantly, it should be noted that where coca cultivation takes place, so too does arms trafficking, labs for processing the coca to cocaine, and other illicit trades that armed groups have traditionally derived their income from. In particular investors looking at agricultural and mining projects are likely to face hostility from the unregulated illegal sectors operating at a local level. The rise in illegal mining in regions of coca production also poses severe social and environmental impacts, which have negative implications in terms of trust and reputation for extractive companies potentially interested in working in these areas.

These regions have historically had a limited state presence and many local industries are often in some way associated with organised criminal or guerrilla groups operating there. Foreign companies looking to make the most of investing in Colombia’s post-conflict economic opportunities, must be sure to carry out detailed local due diligence. However, the substitution cultivation plans do offer companies the possibility to also support local farmers, and cooperatives, to increase productivity and offer rural regions access to larger economic markets. Understanding the local dynamics and supporting local communities will be key for building successful operations in Colombia ahead.