By Joe Penney
BISSAU (Reuters) - Guinea-Bissau's caretaker President Manuel Serifo Nhamadjo may have one of the world's toughest jobs - leading a country where cocaine smuggling is out of control, the economy is in freefall and violence is the top means to political ends.
But his biggest challenge is also the most fundamental: nearly seven months into his tenure, the European Union - once a source of hundreds of millions of dollars in aid to the state - refuses to recognize his administration.
Unless it does, he says, putting Guinea-Bissau back on the path to recovery, and ending its role as a haven for cartels moving cocaine to Europe, after decades of turmoil since independence from Portugal will be impossible.
"There is a lack of understanding on the part of the European Union," Nhamadjo said in an interview with Reuters in his Spartan office in the capital, a portrait of independence guerilla leader Amilcar Cabral on the wall behind him.
"Guinea-Bissau's problems did not begin on April 12," he said, referring to the date of the country's most recent military coup, which provoked the EU's pull-out.
The coup ousted interim President Raimundo Pereira and Prime Minister Carlos Gomes Junior days before an election Gomes Junior was favored to win. Both are now in exile.
Nhamadjo, a candidate in the derailed elections who also served as president of the national assembly, was named transitional president in May in a deal struck by West African bloc ECOWAS and the junta. But the European Union - in a move it claims is driven by zero tolerance for coups - rejected his leadership and cut aid.
The move exposed a division among Guinea-Bissau's traditional partners, with the zero-tolerance camp led by the EU and the CPLP grouping of Portuguese-speaking countries on one side and on the other the 'pragmatist' camp of West African neighbors and the United States, which believe reversing the coup is not feasible.
But without broad international recognition and financial backing, Guinea-Bissau will be unable to hold presidential elections before Nhamadjo's mandate expires in May.
"To hold elections, you need the financial conditions, the coordination of all partners," he said.
Guinea-Bissau is rich in natural resources, including minerals and some of the world's best fishing offshore, but political instability has hindered investment and kept most of its 1.6 million people mired in poverty.
Thin law enforcement and reported state complicity has allowed South American cartels to use its scores of mangrove-lined islands as a transhipment hub for cocaine bound for the markets of Europe for more than a decade.
EU and United Nations officials say that drug smuggling has grown since the April coup, a claim Nhamadjo denies.
"This is part of a large campaign to denigrate the image of our authorities and the work we are doing," Nhamadjo said. "If they really have this information and they are acting in good faith, then they should help us solve this problem."
Guinea-Bissau's authorities have long lamented the lack of funding to counter drug smuggling. Recent events, however, suggest that, at least among the armed forces, when there is a will there is a way.
When the leader of a failed counter-coup bid last month escaped capture, the army shut the borders and sent patrols to scour the countryside. Soldiers tracked and arrested him on a remote island six days later. That efficiency has not been seen in the pursuit of the country's drugs traffickers.
Army chief General Antonio Indjai has been accused of leading the April coup and the EU says he still holds sway.
Nhamadjo said that was untrue.
"My authority has not been questioned," he said. "We give orders, and they (the military) are conforming to the laws of the republic. So we have excellent relations."
(Editing by Richard Valdmanis)