A Drug Trade Primer for the Late 1990's

Newshawk: Steve Young
Pubdate: April 1998
Source: Current History
Contact: chistory@aol.com
Website: http://www.chron.com/
Author: Geopolitical Drug Watch

A DRUG TRADE PRIMER FOR THE LATE 1990S

Editor note: A note in this articles states: "This article is adapted with permission from the 1997 report of the Paris-based Geopolitical Drug Watch. The full report may be found at
www.ogd.org/rapport/gb/RPO3_TENDANCES.html."

Since the late 1980s, drugs have become public enemy number one in the West, embodying the "new lack of order" that characterizes the post-cold war world. By advancing the theory of "the scourge of drugs," Western nations have above all sought to reemploy the geopolitical tools that had been rusting under the influence of what was perhaps hastily described as the "new world order."

The drug system operates on a global scale that recognizes neither nationality nor borders. It is governed by the rules of supply and demand, dumping, and even bartering. As with the effective marketing of any product at the end of the twentieth century; the drug system involves strategies and tactics that bring radically different civilizations, attitudes, and principles into contact, affecting them in various ways depending on the drugs involved. Although an integral part of local and regional history; the system of producing and marketing drugs is nonetheless very different from that of any other product, whether legal or not. Everything connected with drugs is at the same time "modern" and "traditional," "international" and "local." In short, drugs are the barely distorted reflection of the problems involved in managing the world at the dawn of the third millennium.

THE HYDRA EFFECT

The past two years have been a turning point in several respects, first and foremost because of the changes observed in crime related to drug trafficking. During the 1980s the manufacture, export, and, to a lesser extent, distribution of drugs were mainly carried out by major criminal organizations, some of which had become involved in trafficking on a large scale in the course of the previous decade. These were the Italian criminal organizations, the Colombian cartels, the Turkish mafia, and the Chinese triads. Although the centralized and strictly hierarchical structure of such organizations has often been mythicized, it is true that they monopolized a substantial share of the market and maintained business relations with one another.

In the past two or three years the drug trade has taken on a noticeably different appearance. Admittedly, some large criminal organizations still exist ( in Mexico and Burma, for example), as well as midsized outfits (in Colombia, Brazil, and Pakistan), but a massive number of small businesses have sprung up alongside them. In addition to the multi-ton drug shipments occasionally seized by the police -- often amid a blaze of publicity -- considerable quantities of drugs are transported in tiny batches. Placed end to end, they would stretch much farther than the large shipments, as the monthly reports issued by the World Customs Organization demonstrate.
There are several reasons for this change. The first and most obvious is that international anti-drug organizations and national police forces have focused on the most visible forms of crime, which have thus become vulnerable. This is especially true in Colombia and Italy, where major criminal organizations have overestimated their own strength and openly attacked the state itself. This has resulted either in the dismantling of the criminal organizations, as happened with the Medellin cartel after the death of drug lord Pablo Escobar in December 1993, or in a withdrawal or tactical change, as in the case of the Cosa Nostra and the Camorra ( early 1990s), the Cali cartel ( 1995-1996), and the organization in Burma led by warlord Khun Sa ( 1995-1996).

The immediate effect of repression was to disorganize the networks. But by making a virtue of necessity, these large organizations quickly realized that decentralized structures are much less vulnerable and began the process of transforming themselves accordingly. In some cases they even anticipated events. Thus Khun Sa, Burma's "Opium King," gave himself up to the army without a fight in January 1996 in exchange for sharing the market with the military and the possibility of investing in other, licit economic sectors.

Similarly, it is likely that some of the so-called arrests of Cali cartel leaders by the Colombian government were in fact merely disguised surrenders fulfilling agreements with the cartels. Their leaders adopted a strategy of moving into legal business activities after negotiating with Mexican organizations to hand over parts of their export networks to the United States. The Colombian criminal organizations have not disappeared, but they are much more discreet today They have given rise -- if one adds other regional groups, such as the Bogota and Pereira cartels, to the heirs of the two major cartels -- to 40 midsized organizations.
Meanwhile, the withdrawal of the major cartels has enabled small businesses to find their place in the sun without taking too many risks. There might be from 2,000 to 3,000 of these small groups in Colombia, often families or groups of friends who have a relative or other contact in the United States or Europe. The Peruvian and Bolivian organizations, which used to be heavily dependent on their Colombian counterparts, have also taken advantage of the reshuffle to acquire greater independence and, in the case of the Bolivians, to work more closely with Brazilian criminal organizations.

Little is known about the restructuring process involving Cosa Nostra -- although researcher Pino Arlachi speculates that the cupola, its governing body has not met for several years, but more information is available about the restructuring of the Camorra. Naples police say that the success of the struggle against the mafia, which can be attributed to the use of "turncoats" that has led to the arrest of the main "godfathers," has caused a breakup of the organization and an increase in the number of smaller groups. In 1983, about a dozen Camorra groups were counted in Naples; there are now believed to be about 100, with a total of some 6,000 members. They are also better equipped, thanks to weapons obtained from the former Yugoslavia. Other chance factors have contributed to this trend. One example is the emergence of African network -- notably Nigerian -- which are usually based on family or clan structures.
Clearly these new types of organizations make the work of the police much more difficult, and in any case the dismantling of a network only affects a tiny part of the quantity of drugs in circulation. But it is not just police efforts that have triggered the traffickers' reshuffle; other factors have caused or allowed organizations connected with the drug trade to undergo major changes.

BOOMING PRODUCTION

In the past 10 years the supply of drugs has seen uninterrupted growth. Most of the older production zones for coca, opium poppies, and cannabis have remained stable or have been extended, while new production zones ( poppies in Colombia, coca in Georgia) have been opened and areas previously cultivated for traditional use have been converted to supply the international market ( Central Asia, the Caucasus, the Balkans, and Ukraine for poppies and sub-Saharan Africa for cannabis). One of the reasons for this is the internationalization of trade, the effect of which is often augmented by the introduction of structural adjustment programs that have downplayed the role of agriculture in many economies, especially in Latin America and Africa.

To the increase in drug plant cultivation must be added the booming market in synthetic drugs. This growth allows organizations of any size, and even individuals, to obtain drug supplies of all kinds. However, since demand for drugs has at the same time grown and diversified, this profusion on the supply side has not yet resulted in fighting over control of markets.
It was estimated at the end of the 1980s that cocaine hydrochloride production in Latin America ranged between 500 and 700 tons annually; by 1996 this figure was thought to have risen to between 800 and 1,200 tons. In 1988, Burma and Afghanistan were each producing between 800 and 1,000 tons of opium; in 1996 the figure reached about 4,500 tons between the two. Drug production continues to expand in all the countries of Central Asia, the Caucasus, and the Balkans, as well as in China and Vietnam.
Marijuana production is also booming. The amount of land under cannabis cultivation in Morocco rose from 30,000 hectares in 1988 to more than 70,000 in 1996, allowing over 2,000 tons of hashish to be produced. Cultivation in Afghanistan and Pakistan combined yields a similar total weight. Colombia is once more becoming the major marijuana producer it was in the 1970s. Since the United States market is saturated with local crops and imports from Mexico and Jamaica, the Colombians are increasingly turning toward Europe. Seizures of marijuana from Asia, especially Cambodia, are becoming more frequent worldwide. South Africa produces tens of thousands of tons for its own market and is starting to export to Europe. Production is increasing rapidly throughout sub-Saharan Africa, especially in Kenya, Malawi, Nigeria, Ghana, the two Congos, the Ivory Coast, and Senegal. There are many signs that attempts to grow coca and opium poppies are also being made in several of these countries.
Growing global drug production comes in response to booming demand. The large traditional markets, Western Europe and the United States, are relatively stable. But new markets are emerging and expanding rapidly. In the case of cocaine these are Japan and Asia generally South Africa, and especially Russia and other Eastern European countries. The heroin market is also expanding in the former communist states. In addition, there has been a boom in consumption of all kinds of drugs in the producer countries themselves and, more generally, in the third world. This is especially true with heroin in Asia ( especially Pakistan, India, Thailand, and China) and cocaine in Latin America ( especially Argentina, Brazil, and Chile). Synthetic drugs are also making major breakthroughs in third world markets in Asia and Africa.

This diversification of both user markets and production zones provides an initial explanation for the growing number of small and midsized businesses -- especially given the increasing number of victims of the recession in both the third world and the major urban centers of developed countries, where narcotics production and trafficking and even "utilitarian" drug use can be means of survival.

THE INCREASE IN LOCAL CONFLICTS

The growing number of local conflicts, a side effect of the end of the cold war and the convulsions caused by the collapse of the Soviet Union, have also contributed to the changed nature of the drug system. The major powers, prevented from engaging in direct clashes by nuclear deterrence, previously came into conflict through their allies in the third world. The end of the cold war, far from bringing these local conflicts to a halt, merely highlighted the lack of any true ideological reasons behind them and unleashed forces based on ethnic, religious, and national factors.
The warring factions, no longer able to count on their powerful protectors to finance their causes, have been forced to seek alternative sources of income in trafficking, including drug trafficking. Some of these conflicts, such as those in Colombia, Afghanistan, and Angola, were in progress before the end of the cold war, but the withdrawal of the superpowers means they have acquired a new character, gradually drifting into predatory behavior in the case of the Armed Revolutionary Forces of Colombia ( FARC), or ethnic and religious antagonism manipulated by regional forces in the case of the Afghan civil war. In most instances the end of the superpower struggle revealed dissension that the leaden weight of communist regimes had helped to mask; this is what happened in the Yugoslav, Chechen, and Azerbaijani-Armenian conflicts, and in the civil wars in Georgia and Albania. The protagonists in these clashes were thorough in their search for financial support, trafficking in a host of commodities that included oil, drugs, and strategic metals. Typically they used their diaspora communities and migrants in Western Europe as bridgeheads, with the players setting up networks to earn cash for the cause or sometimes acting autonomously Secret agents in many countries ( Russia, Pakistan, and South Africa, for example) who in earlier times had used the drug trade to finance unofficial operations have often switched to activities with purely criminal ends.

These developments, coupled with the factors mentioned above, have led to an increase in what Geopolitical Drug Watch describes as "short" or "fragmented" networks. The people involved are not trafficking "professionals" and do not specialize in a single product. They work only sporadically and drop their criminal activities once they have achieved their political or economic goals.

EASTERN EUROPE AND SYNTHETIC DRUGS

In another striking development, the mid-1990s saw the countries of the former Soviet bloc enter the drug trade. The main target for these new producers is Western Europe, but there are many signs that they are also taking an interest in more distant markets such as North America, South Africa, and Australia.

To enter the drug trade, local criminal organizations can usually choose to cultivate drug plants or use a deserted chemical factory to make synthetic drugs. In Eastern Europe the latter choice is favored since the basic chemical ingredients are not subjected to close scrutiny; highly qualified and underpaid chemists are in plentiful supply; and drug users in the region ( at least in urban areas) have little experience with natural drugs and therefore have no objection to replacements.
In the past few years it appears that synthetic drug production has begun on a large scale in Eastern Europe. German police estimate that between 20 and 25 percent of the amphetamines seized in the country in 1994 came from Poland, while Warsaw authorities estimate that Polish production supplies roughly 10 percent of the European market. University laboratories are suspected of producing drugs and huge numbers of couriers have been arrested at the German and Swedish borders. The Czech Republic vies with Poland for the title of second-largest European producer of psychotropic drugs ( after the Netherlands), especially ephedrine, the main precursor chemical in the manufacture of methamphetamines. In 1994, the UN condemned an incident in which 50 tons of Czech ephedrine was sent to clandestine Mexican laboratories by way of Switzerland. The finished product was apparently intended for the United States market.
Various scandals since 1992 have shown that Latvia and Hungary are favored by notably Dutch and Scandinavian investors, who finance the production of Ecstasy for European Union countries, as well as the manufacture of amphetamine derivatives in liquid, injectable form. In 1993 the International Narcotics Control Board expressed concern about the existence in Bulgaria of state enterprises manufacturing phenethylamines under the brand name Captagon for export without permission to Nigeria and the Arabian peninsula, by way of Turkey.

Among the former Soviet republics, Azerbaijan has specialized in manufacturing synthetic opiates ( methadone, normorphine, 3-methylfentanyl) and methamphetamines in the cities of Gyandzha and Baku. In other parts of the former Soviet Union synthetic ephedrine is extracted from pharmaceutical ingredients and converted into ephedrone ( an amphetamine derivative known in the United States as methcathinone). Ephedra vulgaris, which is cultivated in Azerbaijan, grows wild in Kyrgyzstan and Kazakhstan's Almaty region.

China also makes the most of its Ephedra resources. Clandestine methamphetamine laboratories, supplied with ephedrine appropriated from the pharmaceutical industry have sprung up in Guangdong and Fujian provinces, for the moment almost exclusively for the Southeast Asian and former Soviet republic markets. In many cases it is the Taiwanese triads, whose members come from southern China, that are behind this production.

A NEW GLOBAL DIVIDE

At the start of the third millennium, synthetic drugs will probably have the dubious merit of standardizing the various divides in drug use: between the better-off and the disadvantaged in rich countries; and between developed countries and the developing world. As with other drugs, the only difference will lie in the quality of the product. But it is also likely that this large-scale drug abuse affecting tens of millions of individuals will merely coexist alongside the "classic" use of drugs derived from plants.

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