Lawless Rio

Rio de Janeiro's new police chief has declared that the city is "out of control" after a wave of attacks by drug gangs on tourist hotels and shopping centres.

Police have killed more than 100 suspected drug traffickers in the past two weeks in gunfights in the main streets of Brazil's jet-set city. Seventy-three police officers have been killed in clashes with criminals in Rio this year. The death toll is almost double the same period last year.

"It's not just the police in Rio - there are no police in Brazil who are ready to confront this," said Anthony Garotinho, the state's secretary of public security.

"We cannot deny that the situation is out of control. To say that it isn't is to ignore the reality," he said.

The heavily armed drug gangs who control the city's 800 shanty-town areas, which sit cheek by jowl with middle-class neighbourhoods, have launched a series of audacious attacks that have shocked the city's residents.

Homemade bombs were thrown at the luxury Hotel Le Meridien on Copacabana beachfront and at a hotel and restaurant in nearby Leblon. Last month, shots were fired at the up-market Hotel Gloria. A grenade was thrown at one shopping centre and another was machine-gunned.

Scores of buses have been burned out and gun battles have closed the city's main roads.

In one incident, nine of 20 military police out on patrol were injured - four from bullet wounds - when their vehicle veered into a ditch after it was ambushed.

Terrorised by the violence, Rio's citizens are becoming recluses in their own homes, ordering takeaways rather than venturing to restaurants. Home deliveries have jumped by 40%, according to Axandre Sampaio, president of Rio's Hotels, Bars and Restaurants Syndicate.

Hotels have seen a sharp decline, down 30%.

Brazil is losing $10bn (£6.2bn) a year in foreign tourism because of the crime wave, Ib Teixeira, of the Getulio Vargas Foundation, a financial thinktank, said. It is now second only to the US in the world market for bulletproof cars.

The national public security secretary, Luiz Eduardo Soares, meanwhile called the police "professionals of barbarism" at a human rights seminar in the city last Friday. "The police need a clear political direction because they are armed men," he said. "They can continue to be professionals of barbarism, but must also be professionals of the city."

The defence minister, Jose Viegas, said the situation was "worrying", but that putting troops back on the streets, as was done during the carnival, "could have consequences that nobody wants".

Emergency national government funds will be released in an attempt to contain the fighting ahead of the annual influx of summer tourists.

"In emergency situations and serious crises, people can have more money," the justice minister, Marcio Thomaz Bastos, said after the state agreed to a national security reform plan with an £86m budget. A new elite central intelligence force will work in Rio to combat money launderers, drug traffickers and arms dealers.

The imprisoned drug baron Luiz Fernando da Costa, 35, known as Fernandinho Beira-Mar, was transferred to the Presidente Bernardes prison in Sao Paulo on May 6 in the continuing attempt to break his leadership of Red Command, the biggest of Rio's three drug gangs.

It is the third time in as many months he has been moved, each time under an intense media spotlight showing live pictures of the operations by soldiers and scores of police, accompanied by helicopters.

Mr Bastos has attacked the blanket coverage for making a "pop star" out of a drug dealer.