TERRORISTS GET CASH FROM DRUG TRADE

Trafficking Prime Source Of Funds For Many Groups

In response to this week's terrorist attacks in the United States,
U.S. Secretary of State Colin Powell told a news conference Wednesday
that "we have to make sure that we go after terrorism and get it by
its branch and root."

Mr. Powell meant his comment to be a warning to states that support
terrorists. But the evil of terrorism has another root: money.
Terrorist groups may be forged by people holding fanatical beliefs,
but their operations still need material support. Weapons have to be
bought, training financed, travel paid for, bribes offered and
terrorists sheltered. Even zealots need cash.

"It used to be that the terrorism was funded by nation states,
particularly the old Soviet Union," said John Thompson of the
Mackenzie Institute, a Canadian think tank studying terrorism and
organized crime. "But as the Soviet Union weakened in the 1980s, more
and more insurgent groups, terrorist groups, started to resort to
organized criminal activities to pay their bills."

There are still a few state sponsors left, Mr. Thompson notes,
although today they try to hide that support. These include North
Korea, Iraq and Syria. And in some countries, such as Pakistan and
India, officials "within a state, without the state's knowledge, use
their offices to fund terrorism."

A very few wealthy individuals fund terrorism with their personal
fortunes. Osama bin Laden, a prime suspect in Tuesday's attacks, is
one such benefactor. His wealth comes from the construction industry
and, although his assets were frozen a couple of years ago, Mr.
Thompson believes he was able to spirit out "several tens of millions"
of dollars.

Another common source of cash for terrorists is money raised among
expatriates. The Tamil Tigers of Sri Lanka are thought to derive much
of their funding from donations by Tamils living elsewhere, including
Canada. Sometimes those donations are voluntary, but often terrorist
groups will raise funds through fake charities, or extort them by threat.

But these sources of funding are not the bread and butter of
terrorism, Mr. Thompson said. "The big money earner for most of them
seems to be narcotics."

Law enforcement agencies agree. In 1994, Interpol's chief drugs
officer, Iqbal Hussain Rizvi, admitted that "drugs have taken over as
the chief means of financing terrorism."

After the fall of the Soviet Union, terrorists quickly moved into the
business that offers bigger, faster profits than any other. In
Northern Ireland, both Loyalist and Republican paramilitaries traffic
drugs to pay for weapons.

In Kosovo, "the creation of the KLA (Kosovo Liberation Army) was
financed by intense heroin trafficking from Istanbul," Alain
Labrousse, the head of Observatoire francais des drogues et des
toxicomanies, a French organization that studies drugs, recently
testified before a Canadian Senate committee. "The heroin was sold in
Switzerland to buy Kalashnikovs and handguns."

In Peru and Colombia, leftist rebels have tapped into the illicit
trade in cocaine and heroin to finance their activities. The leader of
right-wing paramilitaries in Colombia recently admitted that they get
70 per cent of their funding from the illegal drug trade.

In his presentation to the Senate committee, Mr. Labrousse presented a
list of countries in which armed insurgents have been financed to some
degree by the black market in drugs. There were 29 nations in all.

Just how much of a group's financing comes from drugs varies widely,
Mr. Thompson said. "With the Islamic fundamentalists, (it is) maybe 25
to 30 per cent. It's probably the single biggest money earner."

The drugs trafficked by Islamic terrorists include marijuana from
Lebanon, but more commonly they distribute heroin. Afghanistan is one
of the largest growers of opium poppies, the source of heroin.

Even Osama bin Laden may have his hands in the drug trade. According
to a Russian report, Mr. bin Laden has bankrolled Chechen gunmen in
Dagestan with funds generated from heroin trafficking.

The importance of illegal drugs to the financing of terrorism raises
an obvious question. If illegal drugs are the single largest source of
funding for terrorism, can you hurt terrorism by legalizing drugs?

"Probably," John Thompson said. "In fact I think you could hurt it
considerably."

Drug policy activists have long argued that by banning drugs and
putting them into the black market, Western nations have fuelled mayhem.

"We have to look at the ways that our drug policies are enriching
terrorist organizations just the way that they're enriching organized
crime," said Eugene Oscapella, an Ottawa lawyer and a founding member
of the Canadian Foundation for Drug Policy.

So far, that reconsideration hasn't happened. The G8 and the United
Nations have discussed the problem of terrorist financing over the
past several years, but they have never discussed drug prohibition in
that light. The G8 went so far as to explicitly refuse to talk about
drug legalization.

Instead, they have focused on fundraising among expatriate communities
and other, lesser sources of financing.

Yesterday, British Prime Minister Tony Blair insisted that in striking
back at terrorism, the West would have to cut off the money that pays
for terrorist atrocities.

There's little question that the drive against terrorism will be
sweeping, taking in all the "roots and branches," including financing.
But Mr. Thompson doesn't expect world governments to seriously
consider whether they might cut off much of the money flowing into
terrorist hands by abolishing drug prohibition.

"This is a sacred cow. It's going to be hard to kill."