Al Qaeda may be rebuilding

As the US has focused on the war in Iraq, Al Qaeda may have been lying low - watching and waiting for the right opportunity to strike.

To be sure, the US has accumulated a string of successes in combating Osama bin Laden's umbrella terrorism group. At least five top-tier Al Qaeda operatives, who may provide information that helps authorities head off future attacks, have been apprehended since March 2001.

Overall, the news on terrorism has been good. Terrorist attacks worldwide dropped by 30 percent from 2001 to 2002, according to a new State Department report.

But some intelligence sources and experts outside government believe that Al Qaeda has been quiet by choice, not because its plans have been disrupted. There is also evidence that Al Qaeda's remaining leadership believes the war in Iraq will produce a new stream of recruits disenchanted with American actions, perhaps allowing Al Qaeda to create a new front of international jihad.

"The toppling of the Saddam Hussein regime could have a cataclysmic effect on the mobilization of recruits for Al Qaeda," states an intelligence report prepared by a European partner in the war on terror. "Despite the significant successes we've had against them, and the pressure we've brought to bear, we cannot say that the Al Qaeda network has been weakened, let alone destroyed."

These sources are concerned that, since the fall of Afghanistan, Al Qaeda has continued to do what it has learned to do well over the years - evolve and adapt as the US and its allies cut off its bases of support. Recently, the network has:

• Replaced some key leaders while decentralizing its operations - outsourcing many of its recruiting, training, and planning activities to regional Islamic groups.

• Made inroads in taking back territory in Afghanistan.

• Adapted its financial support system, making it more difficult to detect.

Just last week, US officials warned Americans against traveling to Saudi Arabia, as they'd received "credible" information about plans for an attack on US interests there. And the arrest last week of another key Al Qaeda member, along with five lower-level operatives in Pakistan, reportedly broke up a plot to fly an airplane into the US Consulate in Karachi. The US has also nabbed four other high-level Al Qaeda operatives in Pakistan and is interrogating them in an undisclosed location.

But intelligence officials and experts on terror also point out that Al Qaeda never carried out spectacular attacks, like the 9/11 attacks or the 1998 embassy bombings in Africa, in less than two-year intervals. Many of those attacks were in planning stages for more than four years. That has officials worried about what may now be in the planning stages.

The European intelligence report, in a segment addressing the March arrest of Khalid Sheikh Mohammed, states: "We have so far been unable to identify a successor to the operations and planning chief." But, it says, there is a good deal of concern that he could have a number of attacks planned, and that cells may be waiting for a signal to execute in any of a number of countries.

Furthermore, the report and other intelligence sources say, Al Qaeda has demonstrated it has a deep bench. The detentions of key operatives are setbacks, but 70,000 men have passed through Al Qaeda's training camps or fought with Arab freedom fighters in Afghanistan.

"Has Al Qaeda been hurt by its losses? Sure," says a senior US intelligence official. "But there's no indication that the losses aren't being replaced." With binLaden and his key associates hiding, Al Qaeda leaders must exploit conflicts in regions of the world where their contacts now reside.

The European intelligence report says that Al Qaeda's most important links are now with groups in Pakistan, Southeast Asia, and East Africa. In most of these areas, there is a great deal of animosity toward US actions and policies, in turn creating a more fertile recruiting ground for Al Qaeda.

Greg Fealy, a Southeast Asia expert at John Hopkins School of Advanced International Studies in Washington, says in Indonesia there is a "general distaste and revulsion at the US for actions they perceive in contravention of international law. It's quite possible that the Iraq war could produce more terrorists in Indonesia.

The intelligence report states that Saudi Arabia is still important financially to Al Qaeda, and that both Saudi Arabia and Yemen continue to provide recruits, as well as places for the group to retreat and plan.

The finances of the group remain a chief concern. Intelligence officials and experts say Al Qaeda continues to adapt its financial support mechanisms. The US has frozen about $125 million of several individuals and organizations, such as charities that have funneled a percentage of their contributions to Al Qaeda.

But officials say the group's overall assets, and the number of ways they use to transfer money, are unknown. The intelligence report says Al Qaeda is increasingly using "legitimate" businesses.

"We have made it more difficult for terrorists to collect and move funds," E. Anthony Wayne, assistant secretary of State for economic and business affairs, said at a House hearing in March on international terrorism. But "as we have successfully clamped down on abuses of the formal banking sector internationally, terrorists have gravitated increasingly towards charities and alternative remittance systems."