The United Nations has announced that opium poppy cultivation in Afghanistan
has soared and is expected to increase by 59% in 2006. The production of opium
is estimated to have increased by 49% in relation to 2005.
The Western media in chorus blame the Taliban and the warlords. The Bush administration
is said to be committed to curbing the Afghan drug trade: "The US is the
main backer of a huge drive to rid Afghanistan of opium... "
Yet in a bitter irony, US military presence has served to restore rather than
eradicate the drug trade.
What the reports fail to acknowledge is that the Taliban government was instrumental
in implementing a successful drug eradication program, with the support and
collaboration of the UN.
Implemented in 2000-2001, the Taliban's drug eradication program led to a 94
percent decline in opium cultivation. In 2001, according to UN figures, opium
production had fallen to 185 tons. Immediately following the October 2001 US
led invasion, production increased dramatically, regaining its historical levels.
The Vienna based UN Office on Drugs and Crime estimates that the 2006 harvest
will be of the order of 6,100 tonnes, 33 times its production levels in 2001
under the Taliban government (3200 % increase in 5 years).
Cultivation in 2006 reached a record 165,000 hectares compared with 104,000
in 2005 and 7,606 in 2001 under the Taliban (See table below).
Destabilizing Afghanistan's Agriculture
The US led invasion and military occupation has served to protect the lucrative
Golden Crescent drug trade, which has resulted in billions of dollars of revenue
accruing to corporate syndicates, organized crime and Western financial institutions.
It has also contributed to destroying Afghanistan's agricultural base. From
the outset of the US led occupation, the introduction and imposition of genetically
modified seeds by US aid agencies has contributed to destabilizing and ultimately
destroying the agricultural cycle.
The US supplied Afghanistan with genetically modified wheat together with appropriate
types of fertilizer to be used with the GM wheat, which was said to be high
yield drought resistant. The donation of GM wheat granted in the form of aid,
however, has led to destabilizing the small peasant economy because the GM wheat
varieties could not reproduced locally in village nurseries. In 2002, famines
which were barely reported by the media, swept the country.
Multibillion dollar trade
According to the UN, Afghanistan supplies in 2006 some 92 percent of the world's
supply of opium, which is used to make heroin.
The UN estimates that for 2006, the contribution of the drug trade to the Afghan
economy is of the order of 2.7 billion. What it fails to mention is the fact
that more than 95 percent of the revenues generated by this lucrative contraband
accrues to business syndicates, organized crime and banking and financial institutions.
A very small percentage accrues to farmers and traders in the producing country.
(See also UNODC, The Opium Economy in Afghanistan, http://www.unodc.org/pdf/publications/afg_opium_economy_www.pdf
, Vienna, 2003, p. 7-8)
"Afghan heroin sells on the international narcotics market for 100 times
the price farmers get for their opium right out of the field".(US State
Department quoted by the Voice of America (VOA), 27 February 2004).
Based on wholesale and retail prices in Western markets, the earnings generated
by the Afghan drug trade are colossal. In July 2006, street prices in Britain
for heroin were of the order of Pound Sterling 54, or $102 a gram.
Narcotics On the Streets of Western Europe
One kilo of opium produces approximately 100 grams of (pure) heroin. 6100 tons
of opium allows the production of 1220 tons of heroin with a 50 percent purity
The average purity of retailed heroin can vary. It is on average 36%. In Britain,
the purity is rarely in excess of 50 percent, while in the US it can be of the
order of 50-60 percent.
Based on the structure of British retail prices for heroin, the total proceeds
of the Afghan heroin trade would be of the order of 124.4 billion dollars, assuming
a 50 percent purity ratio. Assuming an average purity ratio of 36 percent and
the average British price, the cash value of Afghan heroin sales would be of
the order of 194.4 billion dollars.
While these figures do not constitute precise estimates, they nonetheless convey
the sheer magnitude of this multibillion dollar narcotics trade out of Afghanistan.
Based on the first figure which provides a conservative estimate, the cash value
of these sales, once they reach Western retail markets are in excess of 120
billion dollars a year.
(See also our detailed estimates for 2003 in The
Spoils of War: Afghanistan's Multibillion Dollar Heroin Trade, by Michel Chossudovsky,
The UNODC estimates the average retail price of heroin for 2004 to be of the
order of $157 per gram, based on the average purity ratio).
Narcotics: Second to Oil and the Arms Trade
The foregoing estimates are consistent with the UN's assessment concerning
the size and magnitude of the global drug trade.
The Afghan trade in opiates (92 percent of total World production of opiates)
constitutes a large share of the worldwide annual turnover of narcotics, which
was estimated by the United Nations to be of the order of $400-500 billion.
(Douglas Keh, Drug Money in a Changing World, Technical document No. 4, 1998,
Vienna UNDCP, p. 4. See also United Nations Drug Control Program, Report of
the International Narcotics Control Board for 1999, E/INCB/1999/1 United Nations,
Vienna 1999, p. 49-51, and Richard Lapper, UN Fears Growth of Heroin Trade,
Financial Times, 24 February 2000).
Based on 2003 figures, drug trafficking constitutes "the third biggest
global commodity in cash terms after oil and the arms trade." (The Independent,
29 February 2004).
Afghanistan and Colombia are the largest drug producing economies in the world,
which feed a flourishing criminal economy. These countries are heavily militarized.
The drug trade is protected. Amply documented the CIA has played a central role
in the development of both the Latin American and Asian drug triangles.
The IMF estimated global money laundering to be between 590 billion and 1.5
trillion dollars a year, representing 2-5 percent of global GDP. (Asian Banker,
15 August 2003). A large share of global money laundering as estimated by the
IMF is linked to the trade in narcotics.
Legal Business and Illicit Trade are Intertwined
There are powerful business and financial interests behind narcotics. From
this standpoint, geopolitical and military control over the drug routes is as
strategic as oil and oil pipelines.
Moreover, the above figures including those on money laundering, confirm that
the bulk of the revenues associated with the global trade in narcotics are not
appropriated by terrorist groups and warlords, as suggested by the UNODC report.
In the case of Afghanistan, the UN Office on Drugs and Crime estimates that
a mere 2.7 billion accrues as revenue within Afghanistan. According to the US
State department "Afghanistan drug profits support the Taliban and their
terrorism efforts against the United States, its allies and the Afghan government."
(statement, the House Appropriations foreign operations, export financing and
related programs subcommittee. September 12, 2006)
However, what distinguishes narcotics from legal commodity trade is that narcotics
constitutes a major source of wealth formation not only for organized crime
but also for the US intelligence apparatus, which increasingly constitutes a
powerful actor in the spheres of finance and banking. This relationship has
been documented by several studies including the writings of Alfred McCoy. (Drug
Fallout: the CIA's Forty Year Complicity in the Narcotics Trade. The Progressive,
1 August 1997).
In other words, intelligence agencies, powerful business, drug traders
and organized crime are competing for the strategic control over the heroin
routes. A large share of this multi-billion dollar revenues of narcotics are
deposited in the Western banking system. Most of the large international banks
together with their affiliates in the offshore banking havens launder large
amounts of narco-dollars.
This trade can only prosper if the main actors involved in narcotics
have "political friends in high places." Legal and illegal undertakings
are increasingly intertwined, the dividing line between "businesspeople"
and criminals is blurred. In turn, the relationship among criminals, politicians
and members of the intelligence establishment has tainted the structures of
the state and the role of its institutions including the Military.
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