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Chapter 4 in Terrorism Financing and State Responses: A Comparative Perspective (Stanford 2007), edited by Harold Trinkunas and Jeanne K. Giraldo.

This chapter uses a rational choice approach to examine the political economy of terrorist financing. To date, much of the theoretical literature and almost all government-sponsored reports discuss terrorist organizations as though they are made up of ideologically driven purists who share a uniform commitment to the cause. This assumption is needed to explain how these organizations can both (1) efficiently distribute funds and (2) operate covertly without the checks and balances most organizations require. However, upon closer inspection, one often sees substantial differences in the preferences of key players in terrorist networks. Two selection processes explain why these differences exist, and a principal-agent framework shows how these differences lead to inefficiencies in terrorist financial systems. Terrorist organizations face a trade-offbetween enduring the inefficiency or employing corrective strategies that create vulnerabilities. Governments can undertake specific actions to make this trade-offmore problematic.

The book examines financial and material resources, correctly perceived as the life blood of terrorist operations. Governments have determined that fighting the financial infrastructure of terrorist organizations is the key to their defeat. Since the attacks of September 11, 2001, a good deal has been learned about sources and mechanisms used to finance the "new" terrorism, which is religiously motivated and exponentially more deadly than previous generations of terrorist organizations. New policies have been devised to combat the threat and existing policies have been enacted with greater vigor than ever before. Five years into the battle against terrorist financing, it is time to take stock of the emerging literature on terrorist financing, cut through a number of myths that have developed around the issue, and assess the current policy debates.

Through a series of thematic chapters and organizational and regional case studies--examining terrorist organizations such as Al Qaeda and Hezbollah, and regions such as East Africa, Europe, Latin America, the Middle East, and South East Asia--the authors provide a comprehensive assessment of the state of our knowledge about the nature of terrorism financing, and the evolution and effectiveness of terrorist strategies and government responses. This volume focuses on the preferences of major actors within terrorist networks and government agencies and the domestic and international contexts in which they make decisions and execute their strategies. It argues that both terrorism financing and government responses face problems of coordination, oversight, and information asymmetries that render them vulnerable to disruption.

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The harmful environmental effects of livestock production are becoming increasingly serious at all levels-local, regional, national and global-and urgently need to be addressed, according to researchers from Stanford, the United Nations Food and Agriculture Organization (FAO) and other organizations. The researchers, representing five countries, presented their findings on Feb. 19 at the annual meeting of the American Association for the Advancement of Science (AAAS) in San Francisco during a symposium titled "Livestock in a Changing Landscape: Drivers, Consequences and Responses."

Large-scale livestock operations provide most of the meat and meat products consumed around the world-consumption that is growing at a record pace and is projected to double by 2050, said symposium organizer Harold A. Mooney, professor of biological sciences. "We are seeing tremendous environmental problems with these operations, from land degradation and air and water pollution to loss of biodiversity," he said, noting that the developing world is especially vulnerable to the effects of these operations.

Intensive and extensive systems

Symposium co-organizer Henning Steinfeld of the FAO Livestock Environment and Development initiative emphasized that intensive and extensive forms of production are beset with a range of different problems. In "intensive systems," animals are contained and feed is brought to them. "Extensive systems" generally refer to grazing animals that live off the land.

"Extensive livestock production plays a critical role in land degradation, climate change, water and biodiversity loss," Steinfeld said. For example, grazing occupies 26 percent of the Earth's terrestrial surface, and feed-crop production requires about a third of all arable land, he said. Expansion of livestock grazing land is also a leading cause of deforestation, especially in Latin America, he added. In the Amazon basin alone, about 70 percent of previously forested land is used as pasture, while feed crops cover a large part of the remainder.

"We are seeing land once farmed locally being transformed to cropland for industrialized feed production, with grasslands and tropical forests being destroyed in these land use changes, with resources feeding livestock rather than the humans who previously depended on those lands," added Mooney, who co-chaired the scientific advisory panel for the United Nations-initiated Millennium Ecosystem Assessment.

Climate change

According to the FAO, when emissions from land use are factored in, the livestock sector accounts for 9 percent of all carbon dioxide emissions derived from human-related activities, as well as 37 percent of methane emissions-primarily gas from the digestive system of cattle and other domesticated ruminants-and 65 percent of nitrous oxide gases, mostly from manure.

The problems surrounding livestock production cannot be considered in isolation, nor are they limited to the environmental impact, Mooney said, noting that economic, social, health and environmental perspectives "will be critical to solving some of these problems. We hope to develop a greater understanding of these complex issues so that we may encourage policies and practices to reduce the adverse effects of livestock production, while ensuring that humans are fed and natural resources are preserved, today and in the future."

Kathy Neal is communications manager of the Woods Institute for the Environment.

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This talk will analyze the evolution of lawfare, what Jeremy Bentham called "an irregular system of warfare." Meierhenrich introduces lawfare as a conceptually and analytically distinct type of warfare, and a political strategy not previously theorized in any systematic fashion. In his conceptualization, lawfare is a revolutionary strategy for broadcasting power, by which he means a strategy aimed at the systematic and comprehensive overhaul of the foundations of politics and society. This strategy comprises, inter alia, constitutional enactments, ordinary legislation, presidential decrees, and other regulatory instruments. Based on evidence from cases, Meierhenrich illustrates the economy with which the strategy of lawfare may be used and the ingenuity that it requires. Restating an influential aphorism, he shows how law made the state, and the state made law. By so doing, he explains why this irregular system of warfare stands in much higher favor with men in general than that which is carried on by open force -- illustrating the dark side of democracy and the rule of law.

About the speaker:

Jens Meierhenrich is Assistant Professor of Government and of Social Studies at Harvard University, where he is also a Faculty Associate at the Weatherhead Center for International Affairs. He recently served as the Carlo Schmid Fellow in Trial Chamber II of the International Criminal Tribunal for the Former Yugoslavia, and has previously worked with Luis Moreno Ocampo, the Chief Prosecutor of the International Criminal Court. Professor Meierhenrich is the author of a genocide trilogy, forthcoming from Princeton University Press, comprising "The Rationality of Genocide," "The Structure of Genocide," and "The Culture of Genocide." His book "The Legacies of Law" on the function of legal norms and institutions in the transition to - and from - apartheid, is currently under review. Meierhenrich's publications also include a series of articles on comparative and international law and politics. Work in progress includes a book on judicial responses to the 1994 genocide in Rwanda, a comparative analysis of international courts and tribunals, and a long-term project on state formation and state collapse. He has conducted extensive field research in several international organizations as well as in Africa, Asia, Europe, and Latin America.

Jens Meierhenrich was a Rhodes Scholar at Oxford University, where he earned a D.Phil. in politics and international relations.

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The 14th Informal APEC Economic Leaders' Meeting concluded on Nov. 19, 2006, and the participants had their photo taken in colorful Vietnamese traditional costumes called ao dai. Still in the shadow of the congressional election failure, President George W. Bush, realizing that a stable Asia is very important for the U.S. geostrategy, took advantage of the occasion to enhance the prestige of the United States. Just as American experts said, the Bush administration has probably become a lame duck now, but even a healthy duck needs to find a quiet pond.

"APEC's uniquely trans-Pacific character is an important political reason for U.S. to strengthen the group," Donald Emmerson, director of the Southeast Asia Forum of Shorenstein APARC at Stanford University, explained. "While APEC has lagged, East Asian regionalism has boomed. That has been good for East Asia. But U.S. and East Asian interests alike could be hurt if the Pacific Ocean ends up being split between rival Chinese and American spheres of influence."

However, the U.S. effort to save the Doha Round of trade talks with the Asia-Pacific Free Trade Agreement has yielded little. The Doha Round aimed to remove trade barriers in the world but was suspended due to some countries' agriculture protection policies. Washington had wanted to model the Doha Round upon the Asia-Pacific Free Trade Agreement. But U.S. officials never expected that there would be so many differences among the Asia-Pacific leaders, and that the economic development of Pacific Rim countries differ in thousands of ways. Despite the fact that the Hanoi Statement reiterated that supporting the Doha Round was APEC's priority, no material progress has been made.

"The U.S. is urging a last ditch effort to restart the talks through APEC," Professor Charles Morrison, president of the East-West Center located in Hawaii, says. "Whether or not APEC can do more than make a rhetorical statement of support is unsure. I feel that the APEC economies should agree to prepare new offers within a short period of time -- three weeks, for example -- to challenge the Europeans, Brazilians, Indians and others."

United States Steps Out to "Please" ASEAN

Seventeen years after its establishment, APEC now plays a decisive role in the international political arena. It has 40 percent of the world's population, 48 percent of the world trade volume and 56 percent of the world GDP. Since 1989, the economy in this region has grown by 26 percent, compared to only 8 percent economic growth rate in the rest of the world. With the double advantage of economic strength and rapid growth, China, being one of APEC's main economies and its "engine," has fully taken the limelight. On the other hand, the United States has been weighed down with countering terrorism in the Middle East.

"China has done very well in enhancing its relations with Southeast Asia in recent years," Sheldon Simon, professor of the Program in Southeast Asian Studies at Arizona State University, points out. "China has not only established a free trade forum for China and ASEAN countries, but also helped and influenced the area with its economy and culture. But I think that the United States has realized the importance of this area and come back to fasten its friendly relationship with the region."

The United States coming back to Southeast Asia and repairing its relations with the ASEAN countries is partly activated by China's increasing influence in the area.

"The naissance and growth of some democratic countries in Southeast Asia has received sympathetic response of democratic values from Washington," said Simon. "With the traditional friendly relations between the area and the United States, these countries value their friendship with the United States sometimes more than the trust in their neighboring countries. Geopolitics is also very important factor. The Asia-Pacific area is a very important to the world economy and the U.S. power structure. Therefore, the United States will not easily give it up."

Another motive for the United States to foster closer relations in the area is the common interest of countering terrorism. There are still some terrorist groups in Indonesia, the Philippines and southern Thailand.

"President Bush has a perfect attendance record at APEC meetings (Clinton missed two of them), which says that he does take APEC seriously and believes Asia is important to U.S. interests," Ralph Cossa, president of the Pacific Forum Center for Strategic and International Studies, said in an interview with the Washington Observer Weekly.

Besides attending the APEC summit meetings annually, Washington has recently activated several plans to "please" the ASEAN countries, including setting up a ministerial dialogue system with them and a platform for maintaining contact at the deputy finance minister level, even increased exchanges at the deputy defense secretary level.

The extent of U.S. efforts to foster cordial relations with Southeast Asian countries can also be seen in the increasingly friendly U.S.-Vietnamese economic and trade relations. The Bush administration is not only supporting Vietnam to enter the WTO, but has even proposed giving Vietnam Permanent Normal Trade Relations (PNTR) status.

"The reason that Bush failed to bring the gift of PNTR status to the APEC Hanoi summit is that the Congress dominated by the Republicans was lacking efficiency and could not pass the proposal in time," Simon explained. "But I think that it will be passed as soon as possible in the next month or by the Democrats who begin to dominate the Congress from next January."

Simon and Cossa both admit that Burma is an unharmonious element in U.S. relations with ASEAN. The Burmese dictatorial military government is really the most typical negative example of democracy for the United States. But ASEAN countries are reluctant to see Burma "punished" by the United States for ideological reasons. So Burma has become a sensitive issue in U.S.-ASEAN relations.

"This is a good way for him to interact with ASEAN since Myanmar is not there and this issue does not have to be addressed," said Cossa.

Simon, an expert of Southeast Asia affairs, points out ASEAN countries should be happy about the advantage they have with China and the United States vying for their attention. Being able to juggle the two big powers, Southeast Asia has gained many practical interests and financial aid for its economy, trade, security, culture and education.

"In a short period, there will not be any serious interest conflicts in the triangle balance of China, the United States and ASEAN," Simon told the Washington Observer Weekly. "ASEAN countries' only worry, if there is any, is an accidental spark in the U.S.-China military interaction in Southeast Asia such as the confrontation across the Taiwan Straits."

Turning the Asia-Pacific into a "Gigantic Enterprise?"

"The United States wants to demonstrate its continuing interest in the Asia-Pacific region. It is urging for a study of an Asia Pacific free trade area and support for an APEC business card, and both shifts of approach, illustrate its interest in and support for the APEC process," said Morrison.

An important subject for the APEC Hanoi summit is the "active discussion" of establishing an APEC free trade region. Former U.S. President Bill Clinton proposed for the first time in 1993 the setting up of such an economic zone. Before Bush's visit, Deputy U.S. Trade Representative Karan Bhatia suggested that establishing an APEC free trade zone would be a subject worth serious discussion. But his proposal did not receive a warm response from the host. The Vietnamese Deputy Foreign Minister Le Cong Phung stressed that establishing a free trade zone is a long-term objective and will not affect progress of negotiations with the WTO or other bilateral trade agreements.

"Regarding the study of the Asia Pacific free trade area, a number of economies were skeptical because it would be such a large undertaking," said Morrison. A similar plan was once axed in an APEC ministerial statement and the leaders attending this summit do not seem to have much interest in it.

Simon explained Bush's thinking on the subject: "Washington reiterated its intention to establish an Asia-Pacific free trade zone in order to save the precarious WTO Doha Round. Breaking the tariff barriers in the Asia-Pacific region will help continue to press relevant countries to concede in granting agricultural tax subsidies and hopefully open the door to the Doha Round."

The five-year Doha Round was suspended in July this year because six major WTO members -- the United States, the European Union, Japan, Australia, Brazil and India -- failed to reach agreement on market access for agricultural and non-agricultural products. Given the situation, the organizer said that the informal APEC economic leaders' meeting would provide a "good opportunity" to help restore the Doha Round talks. However, the Hanoi summit joint declaration just vaguely indicated that APEC will pursue further integration on issues such as energy in 2007. It would be extremely optimistic to expect that APEC will be able to remove all the tariff barriers in the region before 2010. Although the area produces 50 percent of the world's economic value, the styles and stages of economic development, the cultural backgrounds and political systems of the countries in the region vary a great deal, making it very difficult for these Asian countries to eliminate all these discrepancies and become fully integrated.

"Out of different worries, many Southeast Asian countries are actually not interested in the proposal though they do not speak out. Or we may say that it's not time yet now to change the Asia-Pacific region into a gigantic enterprise," Simon told Washington Observer Weekly.

Quite apart from who concedes what in return for what concession over the APEC free trade mechanism, the question arises: What geographical scope should a regional trade arrangement have? Who should be a party to the agreement and who should not?

There would appear to be three different ideas on the table: (a) the APEC-wide free trade area that the United States proposed at the recent summit in Hanoi; (b) the East Asia Summit-wide framework that Japan reportedly favors, which would include ASEAN + 6 (China, Japan, South Korea, India, New Zealand, Australia) but not the United States; and (c) the ASEAN Plus Three (China, Japan, South Korea) context that China seems to prefer, in which the exact positions of Tokyo and Beijing are not entirely clear.

"Without discussing the merits or demerits of each of these arrangements, suffice it to note that since ASEAN is common to all of them, the net effect of these alternative ideas is to strengthen the negotiating position of ASEAN," said Emmerson. "Then again, ASEAN will not necessarily be unified as to its preference for the three proposals. It will be interesting to look for the positions to be taken by individual ASEAN countries and for their collective effort to arrive at a single negotiating position, e.g., in the run-up to the ASEAN summit and the second the East Asia Summit in the Philippines next month."

Cossa has hope for 2007. "The U.S. in particular would like to see APEC moving faster, and will look ahead to next year, with Australia in the chair, for some real progress."

American Public Doesn't Share Washington's Interest in Southeast Asia

The prospect of economic and strategic cooperation brought about by APEC made for a lively week in Southeast Asia. But it stirred little response in the United States. According to the interviewed experts of Southeast affairs, the American public is still haunted by the situation in Iraq and the mid-term election. Even the U.S. media framed the event as Bush's first visit to a foreign country since the Republicans were defeated in the mid-term election.

"Because of the Congressional election, President Bush will want to show leadership rather than simply respond to the new Congress. Both Doha and the nuclear proliferation issue are examples," said Morrison.

Cossa holds a different view: "I don't think the elections will have any major impact on what Bush does or how he does it during this trip. Iraq is his legacy. What he does in Asia can make things better or worse at the margins but will likely be overshadowed by Iraq."

Simon echoed the sentiment. "On one hand, the Republican Party's defeat in the election cannot directly influence Bush's trip to Asia. On the other hand, Bush's economic achievements in the Southeast region will not add to his political record. In Asia, only the North Korea issue may sway the public opinion in the United States."

Yan Li, Washington Observer weekly - Issue No. 201, November 22, 2006

Reprinted by Permission February 12, 2007.

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Robert R. Amsterdam, founding partner of the international law firm Amsterdam & Peroff, is counsel to the former Yukos head and political prisoner Mikhail Khodorkovsky. For more than 25 years, Mr. Amsterdam has represented corporations and investors in a variety of emerging markets lacking in rule of law, such as Russia, Nigeria, Venezuela, and Guatemala, overseeing complex commercial litigation and advising on political risk. He has delivered speeches before the Carnegie Endowment, the Cato Institute, Georgetown University, University College London, and Chatham House. He has published numerous opinion articles on energy politics and law in the Wall Street Journal, International Herald Tribune, the National Law Journal, the Guardian, and the Independent, among other media. Mr. Amsterdam maintains a blog at www.robertamsterdam.com and is working on a forthcoming book.

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This book presents a comparative study of Colombian drug-smuggling enterprises, terrorist networks (including al Qaeda), and the law enforcement agencies that seek to dismantle them. Drawing on a wealth of research materials, including interviews with former drug traffickers and other hard-to-reach informants, Michael Kenney explores how drug traffickers, terrorists, and government officials gather, analyze, and apply knowledge and experience.

The analysis reveals that the resilience of the Colombian drug trade and Islamist extremism in wars on drugs and terrorism stems partly from the ability of illicit enterprises to change their activities in response to practical experience and technical information, store this knowledge in practices and procedures, and select and retain routines that produce satisfactory results. Traffickers and terrorists "learn," building skills, improving practices, and becoming increasingly difficult for state authorities to eliminate.

The book concludes by exploring theoretical and policy implications, suggesting that success in wars on drugs and terrorism depends less on fighting illicit networks with government intelligence and more on conquering competency traps--traps that compel policymakers to exploit militarized enforcement strategies repeatedly without questioning whether these programs are capable of producing the intended results.

The author is an assistant professor of political science and public policy at Penn State Harrisburg. He worked on this book as a CISAC fellow in 2004-2005.

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The talk will explore and explain the emergence of alternative sets of winners and losers within the working class in three cases of sweeping industrial and market liberalization.

Sebastian Etchementdi is Assistant Professor of Political Science, Department of Political Science and International Studies, Universidad Torcuato Di Tella, Buenos Aires, Argentina.

He is currently a Visiting Assistant Professor in the Department of Political Science at Stanford University. He received his Ph.D. from the Department. of Political Science at University of California at Berkeley working with Ruth and David Collier.

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Sebastian Etchemendy Speaker Universidad Torcuato Di Tella, Buenos Aires, Argentina
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The Pinochet Case

Patricio Guzman's The Pinochet Case investigates the legal origins of the case against Augusto Pinochet, the general who overthrew President Salvador Allende of Chile in 1973. This documentary follows the legal cases that ultimately led to Pinochet being arrested and tried for his crimes against humanity committed over the 25 years that he ruled Chile.

Carlos Castresana received his law degree in 1979 from Complutense University, Madrid, Spain. He served as a District and Examine Judge, and Court Magistrate for a number of years, before becoming a member of the Public Prosecutors of Spain, where he worked in the Anti-drug and Anti-corruption Special Offices. In 2005, he was appointed Prosecutor of the Supreme Court. He was also a professor of criminal law at the University Carlos III, Madrid.

Mr. Castresana authored the formal complaint and subsequent reports in the Pinochet Case before the Audiencia Nacional in Spain. He has served as an expert in international legal cooperation and other issues in Europe and Latin America, under appointment of the United Nations, European Union, and Council of Europe. He received the Human Rights National Award in Spain in 1997, was awarded the Doctorate Honoris causa from the Guadalajara University, Mexico in 2003, and the Certificate of Honor from the City and County of San Francisco in 2004. Mr. Castresana teaches courses on human rights in Latin America and international criminal law and is coordinator of Project H32, in the United Nation's Office of Narcotics and Crime in Monterrey, Mexico.

Sponsored by the Stanford Law School, the Program on Global Justice, the Forum on Contemporary Europe, the Stanford Film Lab, VPUE, and the Introduction to the Humanities Program.

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Carlos Castresana Coordinator of Project H32 Speaker the United Nations' Office of Narcotics and Crime
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Luis Moreno-Ocampo was unanimously elected by the Assembly of States Parties to the Rome Statute of the International Criminal Court on April 21, 2003. Between 1984 and 1992, as a prosecutor in Argentina, Mr. Moreno-Ocampo was involved in precedent-setting prosecutions of top military commanders for mass killings and other large scale human rights abuses.

He was assistant prosecutor in the "Military Junta" trial against Army commanders accused of masterminding the "dirty war," and other cases of human rights violations by the Argentine military. Mr. Moreno-Ocampo was the prosecutor in charge of the extradition from investigation and prosecution of guerrilla leaders and of those responsible for two military rebellions in Argentina. He also took part in the case against Army commanders accused of malpractice during the Malvinas/Falklands war, as well as in dozens of major cases of corruption.

In 1992, Mr. Moreno-Ocampo resigned as Chief Prosecutor of the Federal Criminal Court of Buenos Aires, and established a private law firm, Moreno-Ocampo & Wortman Jofre, which specializes in corruption control programs for large firms and organizations, criminal and human rights law. Until his election as Chief Prosecutor of the International Criminal Court, Mr. Moreno-Ocampo worked as lawyer and as Private Inspector General for large companies. He also took on a number of pro bono activities, among others as legal representative for the victims in the extradition of former Nazi officer Erich Priebke to Italy, the trial of the chief of the Chilean secret police for the murder of General Carlos Prats, and several cases concerning political bribery, journalists' protection and freedom of expression.

Mr. Moreno-Ocampo also worked with various local, regional, and international NGO's. He was the president of Transparency International for Latin America and the Caribbean. The founder and president of Poder Ciudadano, Mr. Moreno-Ocampo also served as member of the Advisory Board of the "Project on Justice in Times of Transition" and "New Tactics on Human Rights."

Mr. Moreno-Ocampo has been a visiting professor at both Stanford University and Harvard University.

Sponsored by the Stanford Law School, the Program on Global Justice, the Forum on Contemporary Europe, the Stanford Film Lab, VPUE, and the Introduction to the Humanities Program.

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Luis Moreno-Ocampo Chief Prosecutor Speaker the International Criminal Court, the Hague
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In 1999, The Honorable William H. Luers was elected President of the United Nations Association of the USA (UNA-USA), a center for innovative programs to engage Americans in issues of global concern. UNA-USA's educational and humanitarian campaigns, along with its policy and advocacy programs, allow people to make a global impact at the local level and encourage strong United States leadership in the UN.

Luers had a 31-year career in the Foreign Service. He served as US Ambassador to Czechoslovakia (1983-1986) and Venezuela (1978-1982) and held numerous posts in Italy, Germany, the Soviet Union, and in the Department of State, where he was the Deputy Assistant Secretary of State for Europe (1977-1978) and for Inter-American Affairs (1975-1977). He has been a visiting lecturer at the Woodrow Wilson School at Princeton, at George Washington University in Washington, DC, and at the School of Advanced International Studies at Johns Hopkins University. He was also the director's visitor at Princeton's Institute for Advanced Study in 1982-1983.

Luers received his B.A. from Hamilton College and his M.A. from Columbia University following four years in the United States Navy. He did graduate work in Philosophy at Northwestern University and holds honorary doctorate degrees from Hamilton College and Marlboro College.

This event is cosponsored by the Peninsula Chapter of the World Affairs Council of Northern California and the United Nations Association - Midpeninsula Chapter.

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