Afghan opium production predicted to reach new high
JANE'S INTELLIGENCE REVIEW, OCTOBER 01, 2004
Despite being outlawed by the Afghan government, opium poppy cultivation has expanded rapidly since 2001. Pierre-Arnaud Chouvy examines the dynamics behind the increase, and the impact of opium cultivation on stability in the country.
Afghanistan's opium production is expected to exceed 1999's record high of 4,581 tons in 2004. Sources in the US administration and the UK Foreign Office have reported, ahead of the forthcoming UN Afghanistan Annual Opium Survey, that farmers will produce between 5,400 and 7,200 tonnes of opium in 2004, depending on total acreage and average yields.
The opium economy has now been outlawed by a fatwa signed by Afghanistan's Council of Ulemas in August 2004, which reinforced the ban pronounced by the Afghan transition government of Hamid Karzai on 17 January 2002.
However, opium production is clearly rising in Afghanistan, as opium poppy cultivation has spread to new provinces and districts across the country. It should be noted, however, that what has been widely presented as a major expansion of production in 2002 and 2003 consists mainly of a restoration of previous normal levels of production.
Although it is clear that the opium trade has a destabilising effect in the country it is argued by some that the opium economy, because of its importance for the resource-poor, should not be wiped out precipitately or without compensation. As noted by Frank Kenefick and Larry Morgan in Opium in Afghanistan: People and Poppies, the Good Evil (2004) 'the growing of opium poppies in Afghanistan can be viewed, as an interim measure, as beneficial in many respects'.
The authors argue that 'the production of opium poppy has created paying jobs (perhaps 30 million person-days of work annually) for at-risk Afghans, pumped needed money into the rural economy, helped to lower rural debt burdens, and provided resource flows for rebuilding the homes and rural asset bases that no External Donors' assistance could have executed'.
Opium production since 2001
Several factors have favoured the rapid restoration of opium production since the Taliban prohibition. Prior to 2004 at least, the US largely condoned opiates production both in areas traditionally controlled by the Northern Alliance, for example in Badakhshan, and in areas held by local commanders whose support was deemed strategically necessary to fight the Taliban and Al-Qaeda. Before 2003, when opium came to be denounced as the greatest threat to Afghanistan's stability, peace and forthcoming democracy, the US had been less interested in waging the 'war on drugs' than in using drug traffickers and affiliated warlords as allies to support its short-term Afghan strategy. In doing so, the US re-enacted a strategy largely used during the Cold War, notably in Afghanistan.
Had the US cracked down on opium production and drug traffickers during its new war on terrorism in Afghanistan, it would have alienated intelligence sources and strategic allies in the country. Clearly, pursuing and arresting Al-Qaeda and Taliban leaders has been a goal of considerably superior political and strategic value than dealing with the issue of the drug economy. However, renewed drug production is now denounced as being a major threat to the fostering of democracy and stability in Afghanistan. Indeed, the trade is increasing the wealth and power of local warlords - many of them former allies of the US-led war on terrorism - who are reluctant to submit themselves to the authority of a central government that they do not always recognise as legitimate or independent of foreign influence.
Equally seriously, the opium economy also partly funds - though it is not clear to what extent - opposition groups, such as the remnant Taliban movement and Gulbuddin Hekmatyar's Hezb-i-Islami, that are attempting to disrupt the national election scheduled for 9 October 2004.
Ironically, it was the ousting of the Taliban, immediately after their successful 2000/01 prohibition on cultivation, that has made such a resurgence possible and the magnitude of the increase in production can be partly attributed to the economic consequences of the ban itself, which was almost certainly economically and politically unsustainable.
Opium and Al-Qaeda
Facing a deteriorating security situation and with the 3,600 tonnes of opium produced in 2003 likely to be surpassed in 2004, concerns have been rife that the country is on the verge of becoming a 'narco-state' - a state ruled mainly through, and in favour of, the development of a drug economy - and succumbing to 'narco-terrorism', particularly with regard to funding for Al-Qaeda. However, evidence that links Al-Qaeda directly to the drug economy is scarce.
Mirwais Yasini, the head of Afghanistan's Counter Narcotics Directorate, who estimates that the Taliban and its allies derived more than US$150m from drugs in 2003, has said there are 'central linkages' between drug traffickers, Mullah Omar and Osama bin Laden. However, the US commission investigating the 11 September 2001 attacks in the US noted: 'The US government still has not determined with any precision how much Al-Qaeda raises or from whom, or how it spends its money.' It also stated that there is 'no substantial evidence that Al-Qaeda played a major role in the drug trade or relied on it as an important source of revenue either before or after 11 September 2001'.
Should Al-Qaeda really be involved in the opium economy in Afghanistan, it would not be at the production level but higher up in the chain of drug processing and trafficking, most likely to protect heroin laboratories and trafficking caravans. As for where the money generated from drug production and trafficking goes, it has always been divided iniquitously, among farmers who receive the smallest share, producers, warlords who condone or encourage production in their territory, and local and regional traffickers - who get the biggest share.
If Al-Qaeda's alleged involvement in the drug trade is real, it is something that developed only after the ousting of the Taliban who levied Islamic taxes on the opium trade. It should be noted that it was the Taliban who benefited from Al-Qaeda's funding and not the opposite. Indeed, as stated by the 11 September 2001 commission, 'prior to 11 September 2001 the largest single Al-Qaeda expense was support for the Taliban, estimated at about $20m per year'. Observers estimate that the drug trade was the Taliban's second largest source of revenue, estimated at $80m to $100m in 1999, after finance from the trade and smuggling of consumer goods. The same commission declared that 'intelligence collection efforts have failed to corroborate rumours of current narcotic trafficking. In fact, there is compelling evidence the Al-Qaeda leadership does not like or trust those who today control the drug trade in Southwest Asia and has encouraged its members not to get involved'.
Rensselaer Lee, a long time observer of global drug trafficking, has also dismissed speculation that Al-Qaeda draws tens of millions of dollars from the drug trade, arguing recently in the Baltimore Sun that 'narcotics traffickers are not natural allies of Al-Qaeda's Islamic warriors'.
The value of Opium
That the drug trade plays a significant role in perpetuating instability in Afghanistan is well understood. However, the opium trade is also vital for Afghanistan's broader economy since it generates farmer and trafficker income that is estimated to equal half of the counrty's legitimate gross domestic product (GDP). On the one hand, the war economy has favoured the growth of the drug economy and opium trafficking has given warlords the means to perpetuate conflict. But, on the other hand, the opium economy has made survival possible for many farmers and contributed a great deal to the overall country's economy. Hence, to some extent, the opium economy has helped stabilise a country coming out of over two decades of war and facing a derelict economy.
In recent Afghan history, opium poppy cultivation has been fairly regular, ranging from 54,000 to 80,000 hectares and depending mostly on climatic factors. As for the 91,000 and the 8,000 hectares harvested respectively in 1999 and 2001, yielding 4,581 and 185 tonnes of opium, they clearly stand out as statistical extremes and exceptions. However, while both occurred under the Taliban rule, only the second (185 tonnes/8,000 hectares) can be clearly attributed to a political decision, that of Taliban-imposed opium suppression, and not to economic or climatic factors. However, the Taliban prohibition has had consequences for today's production (quick restoration and, most likely, increase) that should be remembered before any other similar ban - enforced hastily and without compensative income available for the resource-poor - is planned.
Until 2000, Taliban policies were influenced by a combination of internal and external factors, many of which are still prevalent today. On the internal level, Afghanistan's socio-economic situation made, and still makes, opium production one of the only means of providing access to land, labour and credit for many of its farmers, most of whom are either tenants or sharecroppers. The Afghan peasantry's heavy dependence upon opium production, associated with politico-territorial realities of a tribal society with fragile political allegiances, prevented the Taliban from making any attempts at eradication during their few years in power. Abdul Rashid, the director of drug control for Kandahar province in 1997 said at the time that, at least without external aid, it was 'simply not possible to eradicate the poppy without alienating the farmers'. Nevertheless, the Taliban banned opium production in 2000, either to secure international support or, as some have speculated, to drive opium prices up to benefit from additional income. The move was unexpected and extremely successful, at least in the short term, as only 185 tonnes were harvested in 2001, much less than the 3,276 tonnes of 2000. Moreover, only 35 out of the overall 185 tonnes was effectively harvested across Taliban-held territory. The rest came from northern areas controlled by the United Front, notably from Badakhshan.
The 2002 restoration of opium production to pre-ban levels (3,400 tonnes) suggests that the Taliban prohibition was most likely politically and economically unsustainable without strong international aid. Factors in the micro-level economics of opium production in Afghanistan even suggest that the Taliban prohibition made the renewal of production at increased levels an imperative. Under the salaam loan system, Afghan peasants without capital traditionally borrow important sums or benefit from advances against takings: their opium crops are thus sold one or two years in advance at half the price of their value. This credit system, the only available in the country, keeps many farmers in debt at the same time as it makes their survival possible. But when climatic conditions or an enforced ban diminish or even destroy the opium crops, their unpaid debts grow. As was shown by a few close observers of Afghan opium production, the Taliban prohibition thus deeply affected the payment of the farmers' debt. Once the prohibition was lifted, after the ousting of the Taliban, opium farmers immediately resumed cultivating poppy at increased levels in order to repay the accumulated debt.
In many provinces and districts, poor farmers survive mainly from the salaam system and, in many areas opium is the only crop that will be accepted in exchange for a loan. Moreover, opium not only provides access to credit but also to land. As shown by David Mansfield in The Economic Superiority of Illicit Drug production: Myth and Reality (2001), while landless peasants, a majority in Afghanistan, must resort to tenancy or sharecropping, landowners have increasingly adapted the price of their lease to that of the most attractive crop: opium. However, that opium poppy cultivation became increasingly entrenched into micro-level Afghan economics and that the opium economy recently came to equal half of Afghanistan's legitimate GDP does not mean that the country is on the verge of becoming a 'narco-state'. First, opium poppy cultivation is not widespread. In 2003, for example, opium poppy cultivation covered only one per cent of total arable land and less than three per cent of irrigated arable land. Opium poppy cultivation is prevalent in areas where land holdings are small (such as where wheat cultivation alone does not provide enough for a tenant's family), where irrigation is problematic and where access to markets is especially difficult.
Mansfield explains also that 'the proportion of household land dedicated to opium poppy in Afghanistan rarely exceeds 70 per cent and that mono-cropping is particularly infrequent'.
Afghanistan thus seems to be a country that is not taking full advantage of its potential for opium production, rather than one on its way to become a 'narco-state'. Nation- and state-building is only beginning in Afghanistan and its economy is only just starting to recover from over two decades of war and internal feuding. Thus, a growing legal economy will most likely drive up the price of hired labour, something that will in turn make opium harvests increasingly expensive and opium farming economically less attractive. There is hardly any doubt that the country's legal economy will grow considerably and that it will make the share of the opium economy smaller, thus removing the danger of Afghanistan turning into a 'narco-state'.
Dr Pierre-Arnaud Chouvy is research fellow at CNRS, France. He studies the geopolitics of illicit drugs in Asia. His last book is Yaa Baa. Production, Traffic, and Consumption of Methamphetamine in Mainland Southeast Asia, published in September 2004 by Singapore University Press. For more information on his work and other publications, visit www.geopium.org.