Beyond Afghanistan’s Fiasco of Narco-economy 

By: Saddam Hussein

Afghanistan – the world’s leading opium producer and exporter – is bringing out about 80% of the world’s heroin. The narcotics industry, together with widespread corruption is a major source of extra-legal revenue in the country, reports SIGAR.

According to the United Nations Office of Drugs and Crime (UNODC), with a 10% surge in comparison to last year, almost 201,000 hectares of land in Afghanistan were under poppy cultivation in 2016. This represents a twenty-fold upsurge in the opium cultivation since the US invaded Afghanistan back in October 2001. In 2016, opium production had amplified by nearly 25 times, comparing it to the levels in 2001 from 185 to 4800 tons in 2016.

Sixty percent of Taliban’s funding comes through opium, reports Bureau of International Narcotics and Law Enforcement Affairs (INL), US Department of State. INL also observers a correlation, that exists between the insurgency and narcotics trade. Traffickers arrange for weaponry, finance, and logistics support to the insurgency in exchange for protection, reciprocally warlords assist them in transportation of drugs to finance their operations.

Currents trends of poppy cultivation illustrate higher levels historically, when compared to many preceding decades. Though US heroin mostly comes from Mexico, Afghan heroin does make up the bulk of heroin consumed in Canada and the across of the globe.

Several programs targeting at decimating opium cultivation and concentrating on providing substitutes to farmers proved to be futile. The pervasive corruption which infiltrates the Afghan system offers only a fractional description for the fiasco. Opium cultivation is such a lucrative business that proposing tempting replacements to farmers is challenging and expensive, but other factors also plays a vital role in this regard.

Following the 2001 US bombing of Afghanistan, the British government of Tony Blair was delegated by the G-8 Group of prominent industrial nations to execute a drug annihilation program, which would, hypothetically, let Afghan farmers to shift from poppy cultivation to other crops. The British were operating out of Kabul in close connection with the US Drug Enforcement Agency’s (DEA) ‘Operation Containment’.

The UK backed crop eradication program is an apparent smokescreen. Since then, opium poppy cultivation has hit the roof. The presence of US led allied forces in Afghanistan did not result in the extermination of poppy cultivation. On the contrary, the Taliban’s opium ban had certainly instigated the beginning of a heroin shortage in Europe by the end of 2001.

Drug economy is a multi-billion dollar business reinforced by dominant interests, which necessitates a stable and protected commodity flow. One of the veiled objectives of the war was supposedly to reinstate the CIA sponsored drug trade to its unprecedented levels and exercise direct control over the drug routes. Soon after invasion, opium markets seemed restored ostensibly. Opium prices rose; by early 2002, the opium price was almost 10 times higher than in 2000.

Moreover, influential business consortia linked with organized crime, are competing for the tactical governance over the heroin routes. The multi-billion dollar revenues of narcotics are deposited in the Western banking system. Most of the large international banks together with their associates in the offshore banking havens launder large amounts of narco-dollars.

The International Monetary Fund (IMF) assessed global money laundering to be between 590 billion and 1.5 trillion dollars a year, representing 2-5 percent of global GDP. A big chunk of global money laundering as valued by the IMF is linked to the trade in narcotics.

Narcotics economy comprises of producers, processors, traffickers and consumers. This forms a chain. Those who consume have as much a problem on their hands, as those who produce. The largest benefits lands in the hands of traffickers. Afghanistan acts as a driver of narcotics and produces substantial share of it, but what about other components in the chain; the ones Afghanistan have little or no control?

Dynamic international strategy is needed to address all the elements in the chain including narcotics consumption across the world and money laundering collectively, for tangible outcomes.

Saddam Hussein is a Research Fellow at Center for Research and Security Studies (CRSS), Islamabad, while pursuing his MPhil. in Public Policy from School of Public Policy, Pakistan Institute of Development Economics, Islamabad.


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