Pubdate: Mon, 28 Dec 1998 Source: Reuters Copyright: 1998 Reuters Limited. Author: Tracey Ober DRUG TRAFFICKERS TERRORIZE UPSCALE ZONE IN RIO RIO DE JANEIRO, Dec 28 (Reuters) - Shops and restaurants near the governor's palace in Rio reopened on Monday after drug traffickers forced them to close over the weekend to honour a drug lord killed by police, community leaders said. Residents and business owners in the middle-class neighbourhoods of Laranjeiras and Cosme Velho said shootouts between rival gangs in the nearby shantytowns were common, but the forced closings showed a new level of brashness. "I've lived in the neighbourhood for more than 20 years and I've never seen businesses shut down like this," said Thereza Amayo, a former president of the residents' association. She said it felt like they were living in a war zone. The most recent spate of violence began early Saturday with a fierce gun battle between rival gangs in a shantytown. Police said they got involved when four armed men leaving the fight on motorcycles engaged them in gunfire in Laranjeiras. One officer was wounded and convicted drug lord Claudio Passos da Rocha, known as "Portuguesinho" or "the little Portuguese boy," was shot and killed. At the same time, police gunned down two alleged drug traffickers in another shantytown near Cosme Velho. Later on Saturday and Sunday business owners in the two neighbourhoods apparently received phone calls warning them to close their restaurants and shops or risk them being targeted in drive-by shootings. "They said that people were showing disrespect toward the dead," said a worker at a grill called Gaucha, which normally serves some 1,500 people for Sunday lunch. "The grill has existed since 1939 and I've never seen anything like this." Residents took to the streets to protest the violence earlier this year after four men armed with assault rifles blocked a car driven by an 18-year-old student in Laranjeiras and killed her with a spray of bullets. Also in Laranjeiras in April, a thief brazenly walked through security at a Rio state government building and robbed a bank branch inside. "The question of security is national. It's unacceptable that armed bands control areas of the city as if they were safe-havens," said former presidential candidate Alfredo Sirkis, a local resident. Police say Brazil is battling a growing drug trade as pressure on traffickers has increased in the neighbouring cocaine-producing nations of Colombia, Bolivia and Peru. In the state of Rio alone, police confiscated more than 1,000 pounds (450 kg) of cocaine and four tonnes (3,600 kg) of marijuana in the first nine months of this year. - --- MAP posted-by: Richard Lake