Colombia Adds Troops to Bogota Streets as Uribe Begins 2nd Term
Colombia deployed 10,000 extra troops to Bogota streets to protect against rebel attacks today as President Alvaro Uribe becomes the first leader in almost two centuries to start a second consecutive term.

Uribe, who pledges to secure Colombians from rebel attacks and lure investment, will take the oath of office in Congress before regional heads of state and U.S. Treasury Secretary Henry Paulson. Uribe won a second term with a landslide victory May 28, taking 62 percent of the vote on promises to reduce taxes and keep the economy expanding.

In his address, Uribe, 54, probably will seek to show a commitment to helping the nation's poor while promising to keep the budget deficit in check, limit inflation and encourage companies to invest in the $117 billion economy, said Jonathan Binder, who helps manage $500 million of emerging-market assets at INTL Consilium LLC in Fort Lauderdale, Florida.

``Fiscal reforms are key to his second term,'' said Binder, who holds Colombian bonds in his portfolio. ``But the bottom line is a stable democracy begets economic growth and that helps rich and poor alike.''

Hundreds of heavily armed troops will stand guard around the presidential palace and congress building as 29,000 police and military personnel search cars and keep watch in neighborhoods close to government buildings, according to the Defense Ministry. Bombings killed 23 people last week in three separate attacks in Bogota and around the country, and authorities found 300 kilograms (661 pounds) of explosives in the city in the past 15 days.

Uribe, the first president to hold a consecutive term since Simon Bolivar, who took Colombia from the Spanish in 1819, became eligible for re-election when the Constitutional Court in October approved a change in the constitution.

A lawyer who studied finance and administration at Harvard University, Uribe hopes to avoid a repeat of his inauguration in August 2002, when 21 people died and 70 were injured during attacks on the presidential palace by the Revolutionary Armed Forces of Colombia, the biggest guerrilla group.

The drug-funded guerrillas, known as the FARC, have sought to prove a four-year offensive by Uribe's troops has not weakened their numbers or their resolve to overthrow the government, said Alejo Vargas, a political science professor at the National University in Bogota.

``Historically rebels have carried out attacks leading up to and during presidential inaugurations,'' said Vargas. ``It's their way of saying `you've lost your time trying to defeat us'.''

About 30,000 paramilitary fighters and 7,000 guerrillas from the Marxist-inspired FARC and the National Liberation Army have laid down their arms to take up Uribe's offers of job training and reduced prison sentences for crimes.

Uribe's second term paves the way for the South American country's economy to keep expanding and stocks and bonds to add to four years of gains, said Felipe Gomez, head of research at Porvenir, Colombia's largest pension fund.

Since Uribe took office, the IGBC stock index has risen 772 percent in dollar terms, the second-best performance among 80 primary indexes tracked by Bloomberg, and the yield on the 10 percent dollar bond due in 2012 has fallen to 6.4 percent from 13 percent.

Colombia's peso has strengthened to 2,390 on Aug. 4 from 2,628 in August 2002. The local bond and stock markets are closed today for a national holiday.

The president's backers secured a majority of seats in congress in the March elections, boosting his chances of pushing through a free-trade agreement with the U.S., extending a cap on local government transfers, cutting the rate of taxation on personal and corporate income and increasing the number of goods subject to value-added tax.

Increased security under Uribe spurred investment and consumption, driving the economy, which is based on oil, coal, coffee and textiles, to expand each year since he took office.

Growth reached 5.1 percent in 2005, its fastest pace in 10 years, and the central bank predicts a similar rate of expansion this year. Foreign-direct investment rose to a record $10.2 billion last year from $2.1 billion in 2002.

``Any noise the guerrillas are making now would have to be extremely bad and prolonged to have any real effect on investment in Colombia,'' said Binder.

Since taking office, Uribe, whose father was killed by guerrillas 23 years ago, has expanded the armed forces as he clamped down on rebel groups, paramilitaries and drug traffickers. In his four years in office, homicides have fallen 37 percent and kidnappings 72 percent.

The president promises to provide health care to all of Colombia's 41 million inhabitants, ensure every child receives an education and make loans available for the poor to set up businesses.

``Uribe's banner program is improved security and it will likely continue as such,'' said Vargas. Still, ``he will need to focus more on plans to alleviate poverty as improved security leads people to shift their priority to issues such as increased health coverage and job creation.''