THE NEW PEOPLE'S ARMY: DOWN BUT NOT OUT

C O N F I D E N T I A L SECTION 01 OF 03 MANILA 001795

SIPDIS

STATE FOR S/CT, EAP/MTS, DS/IP,ATA, DS/SP/EAP, DS/IT/ATA

E.O. 12958: DECL: 07/29/2018
TAGS: ASEC PTER RP
SUBJECT: THE NEW PEOPLE'S ARMY: DOWN BUT NOT OUT

REF: A. 2007 MANILA 03595: PHILIPPINES INTERNATIONAL
NARCOTICS REPORT

B. 2007 MANILA 03051: AMNESTY FOR COMMUNIST
INSURGENTS

C. 2007 MANILA 01928: NPA ELECTION EXTORTION

Classified By: Ambassador Kristie A. Kenney; for reasons 1.4 (b) & (d)


1. (U) SUMMARY: Thirty-nine years after its founding as the
armed wing of the Philippine Communist Party, the New
People's Army (NPA) has lost much of its ability to conduct
sustained military operations but remains capable of
sporadically disrupting public security and business
operations in certain areas of the Philippines, as recent
attacks have demonstrated. The NPA continues to drag local
economic development and incite fear, but its reduced ability
to recruit new members has diminished its status as a
national security threat. The NPA is formally designated as
a terrorist organization by the United States and the
European Union. From its peak of about 25,000 members in the
1980's, the NPA is now estimated to have fewer then 5,000
supporters. Officials consider eliminating the NPA their
number-one public security priority, and President Arroyo has
called on the military and police to render the NPA
"inconsequential" by the end of her presidency. Earlier last
year, marrying economic incentives and military pressure,
President Arroyo floated a broad amnesty plan for members of
the NPA and Philippine Communist Party who wished to
surrender. And to remind the NPA that military operations
are still a viable option, the Secretary of Defense stated
that the battle against the NPA should be "won with military
force, not without." Despite its reduced strength, the NPA
continues to carry out sporadic attacks against commercial
interests and ambushes of Philippine forces. These
uncoordinated attacks indicate the NPA is an organization
more concerned with financial gain than with offering an
ideological alternative for disenfranchised Filipinos.
Nonetheless these attacks have resulted in more fatalities
and damage than that caused by Islamic terrorist groups such
as Abu Sayyaf and Jemaah Islamiyah, which are active in the
Philippines. As part of its development program in southern
Philippines, the Mission has carried out numerous
infrastructure projects and other activities in areas
previously under the control of the NPA. END SUMMARY.

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THE NPA'S RISE AND DEMISE AS AN IDEOLOGICAL INSURGENCY
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2. (U) Founded in 1969 as the armed wing of the Philippine
Communist Party, the NPA was created to overthrow the
government using guerrilla warfare. Gaining converts in the
early 1970's, the NPA's ranks swelled with student volunteers
after President Ferdinand Marcos declared martial law in
September 1972. Civilian rule returned in 1981, but the
NPA's strength continued to grow to an estimated 25,000
members. Internal strife during the 1980s led some NPA
elements to become involved in kidnapping, extortion, and
reprisal killings of both NPA members and civilians as a way
of maintaining financial support. At the same time, the NPA
targeted Philippine officials and American military
personnel, whose presence in the Philippines the NPA
vehemently opposed. The NPA claimed responsibility for the
assassination of then Joint U.S. Military Assistance Group
Chief Colonel James Rowe in 1989. By 1990s, internal purges
had taken their toll on NPA membership and external financial
support, and the Philippine government offered its first
amnesty program directed to the NPA. The NPA was formally
designated as a foreign terrorist organization by the United
States in 2002, and by the European Union in 2005.


3. (C) After being declared a terrorist organization, the NPA
quickly disintegrated into a loose confederation of isolated
groups hiding in rural or mountainous areas in economically
depressed regions of the Philippines. Squeezed by the
Philippine military and law enforcement and international
sanctions -- which dried up foreign funding -- the NPA began
demanding and collecting "revolutionary taxes" from small
local businesses and rural farms and reportedly became
involved with narcotics organizations through the protection
and taxing of marijuana crops (ref A). Prior to the national
mid-term elections in May 2007, the NPA resorted to
strong-arm tactics, extorting protection money from local
politicians to permit them to run.

MANILA 00001795 002 OF 003



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STILL THE GOVERNMENT'S "NUMBER ONE" SECURITY PRIORITY
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4. (C) In 2002, President Arroyo publicly declared the NPA
the greatest threat to the security of the Philippines. In
2007, after five years of military offensives against the
NPA, she announced a broad amnesty plan for the NPA, the
Philippine Communist Party, and other communist rebel groups
who wished to surrender. This amnesty plan was offered in
conjunction with her pledge to resolve the Communist
insurgency, either through negotiations or military means, by
the end of her term in 2010 (ref B). Similarly, Philippine
Armed Forces Chief General Yano on July 24 emphasized his
support for a peaceful resolution with the NPA. Despite such
confident gestures, the Philippine government's public
position on the NPA has been inconsistent. Recent press
reports emphasize this inconsistency by citing Secretary of
National Defense Gilberto Teodoro statements declaring that
the war against the NPA should be "won with military force,
not without."


5. (C) Late last year, then-Philippine Armed Forces Chief of
Staff General Hermogenes Esperon stated that he was not
convinced that the timetable to eliminate the NPA threat by
2010 was realistic. Sensitive reporting has indicated that
Philippine National Police (PNP) intelligence supervisors
would only accept reports from the field that show the NPA
was losing strength and that personnel captured or killed who
may be suspected to be NPA personnel are to be counted as NPA
personnel regardless of affiliation. However, in late April,
General Esperon's successor General Alexander Yano conveyed a
new sense of optimism, predicting that by 2010 the NPA would
no longer be able to launch offensive military operations, as
the AFP would reduce the NPA's strength to 1,500 members in
the next two years.

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STILL DEADLY
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6. (C) Despite a lack of incidents during the 39th
anniversary of the NPA last March 29, the NPA retains a
potent ability to disrupt periodically the political and
economic development environment through assassination,
kidnapping, and attacks on business operations. On May 5,
2008, former Legaspi City Chief Narciso Guarin, known to have
been on an NPA "hit-list," was assassinated by NPA elements
in Bicol Province. Less than four weeks later, the NPA was
suspected in the killing of a local police chief in Davao
Oriental Province. In March and April, the NPA escalated
attacks on mining sites, agricultural plants, and logging
concessions in Mindanao as a way of enforcing its demands for
protection money and "revolutionary taxes." Guarin allegedly
was targeted as a result of his successful planning and
commanding of operations in 2006, which resulted in the
killing or capture of several known NPA terrorists.


7. (C) The incident capped four months of heightened NPA
activity in which they conducted more than 30 attacks monthly
on police, military, and commercial targets, killing an
average of nine persons each month. Victims included police
and military personnel, locally-elected officials, and labor
leaders.


8. (U) Recent ambuscades by the NPA against the Philippine
military in various areas of Mindanao demonstrate that the
NPA continues to conduct small-scale offensive operations in
isolated areas. In mid-July, the NPA was suspected in a
night-time attack on a jail in Sarangani Province in southern
Mindanao, which according to news reports, was a combined
assault using mortars and small arms fire in a failed attempt
to free a detained comrade. Following these attacks, the
media reported that the Philippine military was deploying
extra troops to the Mindanao region and metro Manila in
response to the recent spike in violence attributed to the
NPA, and to counter potential threats by NPA assassins known
as "Sparrows."


9. (C) The NPA's recent attacks against military and law
enforcement personnel, along with attacks on economic and
communication infrastructure, have led to speculation that
the NPA is becoming a more lethal and resurgent threat to the

MANILA 00001795 003 OF 003


government. Statistics alone indicate that NPA-led attacks
over the past several months have caused far more fatalities
and damage than the more infamous Islamic terrorist groups,
such as Abu Sayyaf and Jemaah Islamiyah, which have also
plagued the Philippines over the past few years. However,
despite the rise in attacks, many senior Philippine officials
continue to publicly down-play the NPA's effectiveness, while
at the same time calling for the group's defeat.


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POLICE AND MILITARY WORKING TOGETHER
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10. (C) As part of a new combined effort by the AFP and the
Philippine National Police (PNP) to defeat the NPA, PNP Chief
General Avelino Razon recently announced that future hostile
encounters between the NPA and the Philippine military would
be treated as crime scenes enabling the police to conduct
forensic examinations and collect scientific data. These new
procedures are expected to contribute to the government's
fight against the NPA by utilizing non-traditional military
options that would be valid for use in criminal proceedings
against them in the Philippine judicial system. Perhaps as a
result of the Philippine government's continued success
against the NPA, the AFP recently reported the NPA has now
shifted its recruitment strategy from its traditional rural
base to urban areas. The AFP attributes this recent shift in
recruiting tactics to its numerous successful confrontations
with the NPA in their traditional provincial bases of
operation.

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U.S. ASSISTANCE FOR FORMER NPA-CONTROLLED AREAS IN MINDANAO
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11. (U) USAID has implemented numerous activities throughout
Mindanao, some in areas that were previously under the
control of the NPA. The range of activities include health,
education, environment, governance, and economic development.
As part of the Growth with Equity in Mindanao programs,
USAID completed a number of projects such as trade centers
and farm to market roads. As part of the USAID sponsored
Computer Literacy and Internet Connection program, more than
600 schools throughout Mindanao were provided with computers
or internet connections. All projects were undertaken in
partnership with the local government, parent-teacher
associations, the private sector, and the Mindanao Economic
Development Council.

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COMMENT
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12. (C) Combined efforts by Philippine military and law
enforcement authorities, along with long-term development
projects initiated and funded by USAID, continue to mitigate
the effectiveness of the NPA throughout much of the
Philippines. Recent attacks on commercial interests, along
with ambushes directed at Philippine military and police
personnel, appear to be retaliatory acts related to extortion
activities rather than actions driven by ideology or
principles. However, despite repeated public statements by
senior Arroyo Administration officials emphasizing their
intent to render the NPA "inconsequential" by 2010, the NPA
continues to drag down local economic development and hamper
the Philippine government's efforts to establish a presence
throughout the country to ensure public order. Focusing on
depriving the NPA of new recruits by developing economic
opportunities for provincial and poor urban areas will be key
if the government is to overcome the NPA's long-running
campaign to weaken the democratic and economic potential of
the Philippines. END COMMENT.
KENNEY