HOW A TINY AFRICAN OUTPOST BECAME THE WORLD'S FIRST NARCO STATE

It is the world's fifth poorest country with no prisons and few
police. Now this small west African failed state has been targeted by
Colombian drug cartels, turning it into a transit hub for the cocaine
trade out of Latin America and into Europe. Grant Ferrett and Ed
Vulliamy tell the remarkable story of how the cocaine cavalry arrived
three years ago and transformed the life of Guinea-Bissau

The roads outside the X Club nightspot in Bissau, capital of the
world's fifth poorest country, are cracked and pot-holed. They have
not been repaired since they were torn up by the tracks of military
vehicles during Guinea-Bissau's civil war of the late 1990s. But the
cars parked outside - Porsche and Audi four-wheel drives - wouldn't
look out of place in the wealthiest quarters of London.

Inside, the music is thumping Europop, a beer costs more than twice
the average daily income of a dollar a day. Many of the clubbers,
though, are knocking back the imported whisky, which costs up to $80
a bottle. One of the regulars points out the people who represent the
various stages of the cocaine supply chain from South America via
Guinea-Bissau in West Africa to the UK and the rest of Europe. 'He's
a pretty big dealer, and that's one of his security guys. That guy
there thinks he's big news but he's just small-time. That woman is a
mule. She's been to Europe a couple of times.

Down a street of elaborate colonial-style buildings is Ana's
restaurant. Beneath red-tiled roofs, giant candles flicker in the
gentle, humid evening breeze - it could be mistaken for an exotic
tourist destination. But 'the only visitors we get are the
Colombians', sighs Ana, 'this country is being destroyed by drugs.
They're everywhere. A few weeks ago, the man who used to be my
gardener knocked at the door and offered to sell me 7kg of cocaine.'

Among the destitute locals are scores of wealthy, gaudy Colombian
drug barons in their immodest cars, flaunting their hi-tech luxury
lifestyle, with beautiful women on their arms. Outside Bissau city
are exclusive Hispanic-style haciendas with wide verandahs, turquoise
swimming pools and gates patrolled by armed guards.

By day, Guinea-Bissau looks like the impoverished country it is. Most
people cannot afford a bus fare, never mind a four-wheel drive. There
is no mains electricity. Water supplies are restricted to the wealthy
few, and landmark buildings such as the presidential palace remain
wrecked nine years after the end of the war. But this wreck of a
country is what the UN - which declared war last week on celebrity
cocaine culture - calls the continent's 'first narco-state'. West
Africa has become the hub of a flow of cocaine from South America
into Europe, now that other routes have become tough for the traffickers.

US drug enforcement agents report that the old cocaine channels
through the Caribbean, markedly Jamaica and Panama, have become more
intensively policed, forcing the Colombians to develop new routes to
traffic cocaine. The increasing might of Mexico's powerful drug
cartels has forced the South Americans to search for trafficking
routes to Europe across the Atlantic rather than through Central America.

Moreover, the West African coast can be reached across the shortest
transatlantic crossing from South America: either by plane from
Colombia, with a re-fuelling stop in Brazil; or by ship from Brazil
or Venezuela. The boats leaving South America travel only by night,
remaining motionless by day, covered in blue tarpaulins to avoid
detection from the air. The journey can be completed in four to five
nights travelling this way.

Once ravaged by the transatlantic slave trade, the West African coast
is again 'under attack', says the Executive Director of the UN Office
on Drugs and Crime (UNODC), Antonio Maria Costa, who calls the impact
on Africa of Europe's cocaine habit an echo of that of slavery. 'In
the 19th century, Europe's hunger for slaves devastated West Africa.
Two hundred years later, its growing appetite for cocaine could do the same.'

The seizure of West Africa by Colombian and other drug cartels has
happened with lightning speed. Since 2003, 99 per cent of all drugs
seized in Africa have been found in West Africa. Between 1998 and
2003, the total quantity of cocaine seized each year in Africa was
around 600kg. But by 2006, the figure had risen five-fold and during
the first nine months of last year had already reached 5.6 tonnes.
The latest seizure, from a Liberian ship - Blue Atlantic -
intercepted by the French navy last month, was 2.4 tonnes of pure cocaine.

But while seizure rates globally are estimated to be 46 per cent of
total traffic, the amounts found in West Africa are 'the tip of the
iceberg', says UNODC. Even though one recent raid in Guinea-Bissau
netted 635kg of cocaine, the traffickers were thought to have still
made off with a further two tonnes.

The street value of the drugs trafficked far exceeds gross national
product. A quarter of all cocaine consumed in Western Europe is
trafficked through West Africa, according to UNOCD, for a local
wholesale value of $1.8bn and a retail value of 10 times that in Europe.

Nigerian drug gangs have always been an energetic presence on the
global trafficking scene, but the target of the South American
traffickers have been the 'failed states' along the Gold Coast, where
poverty is extreme, where society has been ravaged by war and the
institutions of state can be easily bought off - so that instead of
enforcement, there is collusion. And no more so than Guinea-Bissau,
whose weakness makes it a trafficker's dream prey.

In Guinea-Bissau, says the UNODC, the value of the drugs trade is
greater than the national income. 'The fact of the matter,' says the
Consultancy Africa Intelligence agency, is that without assistance,
Guinea-Bissau is at the mercy of wealthy, well-armed and
technologically advanced narcotics traffickers.'

Guinea Bissau, with a population of 1.5 million, is ranked fifth from
bottom in the UN's world development index. Even its recent history
is one of torment: after 13 years of bloody guerrilla conflict, it
won independence from Portugal, spent the first years under a Marxist
Leninist dictatorship, then 18 under Joao Bernardo Vieira, until he
was ousted by a military rebellion. Successive crises, two wars and
economic collapse brought Vieira back in 2005, with a purge of the
army and deceptive stability.

The White House has singled out Guinea-Bissau as 'a warehouse refuge
and transit hub for cocaine traffickers from Latin America,
transporting cocaine to Western Europe. Costa says: 'When I went to
Guinea-Bissau, the drug wealth was everywhere. From the air, you can
see the Spanish hacienda villas, and the obligatory black
four-wheel-drives are everywhere, with the obligatory scantily-clad
girl, James Bond style. There were certain hotels I was advised not
to stay in.'

A senior official at the US's Drug Enforcement Agency (DEA) with a
long record of fighting transatlantic drug trafficking, explained how
and why the capture of Guinea-Bissau took place, and the trail to
Europe. 'Geographically, West Africa makes sense. The logical things
is for the cartels to take the shortest crossing over the ocean to
West Africa, by plane - to one of the many airstrips left behind by
decades of war, or by drop into the thousands of little bays - or by
boat all the way. A ship can drop anchor in waters completely
unmonitored, while fleets of smaller craft take the contraband ashore.

'A place like Guinea Bissau is a failed state anyway, so it's like
moving into an empty house.' There is no prison in Guinea-Bissau, he
says. One rusty ship patrols a coastline of 350km, and an archipelago
of 82 islands. The airspace is un-patrolled. The police have few
cars, no petrol, no radios, handcuffs or phones.

'You walk in, buy the services you need from the government, army and
people, and take over. The cocaine can then be stored safely and
shipped to Europe, either by ship to Spain or Portugal, across land
via Morocco on the old cannabis trail, or directly by air using
"mules".' One single flight into Amsterdam in December 2006 was
carrying 32 mules carrying cocaine from Guinea-Bissau.

The official admitted 'this has happened quickly, and the response
has been tardy. They're ahead of the game.' And it didn't help that
most Western diplomatic presence had left Bissau during the fighting,
preferring to operate from neighbouring Senegal. The US and Britain
shut up shop in Bissau in 1998, the Americans only last July
reopening a diplomatic office in response to the cocaine raids.

Although much of the cocaine goes directly to Spain and Portugal,
London is becoming an increasingly prominent final destination, says
the official - because of the street prices the drug commands - yet
Britain also has no permanent diplomatic presence in Bissau, and has
not joined the Iberian countries and the EU in contributing to the
latest UN plans to help the country. According to the UNODC, the UK
and Spain have now overtaken America in the consumption of cocaine per head.

Guinea Bissau's cocaine Calvary began three years ago when fishermen
on one island found packages of white powder washed up on the beach.
They had no idea what the mysterious substance was. 'At first, they
took the drug and they put it on their bodies during traditional
ceremonies," recalls local journalist Alberto Dabo. 'Then they put it
on their crops. All their crops died because of that drug. They even
used it to mark out a football pitch'.

The real moment of truth came when two Latin Americans arrived by
chartered plane, armed with $1 million in 'buyback' cash, which the
locals gleefully accepted. The two men were apprehended by police,
but released. 'When people found that it was cocaine and they could
sell it,' says Dabo, 'some of those fishermen bought cars and built houses.'

As well as the favourable location, in Guinea Bissau the cocaine
gangs have found a country where the rule of law barely exists. 'It's
an easy country to be active if you're an organised crime lord,' says
the deputy regional head of UNODC, Amado Philip de Andres. 'Law
enforcement has literally no control for two reasons: there is no
capacity and there is no equipment'.

A further development highlighted by the DEA and UNODC is that Guinea
Bissau and other West African countries are being targeted by Asian
and African cartels trafficking heroin across the Atlantic in the
opposite direction, to the US. Last year, the DEA and police in
Chicago tracked nine West Africans who had moved heroin originating
in South-east Asia through various West African countries, markedly
Guinea-Bissau, to the central US.

Estimates vary as to the cogency of the Colombian presence, but one
observer suggests there are as many as 60 Colombian drugs traffickers
in Guinea-Bissau. Colombians have bought local businesses, including
factories and warehouses, and built themselves large homes protected
by armed guards. They and their local hired help flaunt their liberty
to operate - and the money they make from doing so.

'We can see these people walking in complete freedom. They are
parading their wealth. They're showing it completely openly,' says
Jamel Handem, of a coalition of civic groups called Platform GB.

Guinea-Bissau's armed forces and some politicians are thought to be
deeply involved in the drugs trade. Last year, two military personnel
were detained along with a civilian in a vehicle carrying 635kg of
cocaine. The army secured the soldiers' release and so far there is
no sign that they will face charges.

In his large, carpeted, air-conditioned office, a refrigerator
humming quietly in the corner, the army spokesman, Colonel Arsenio
Balde, brushes aside suggestions the incident proves the army's
complicity in the drugs trade. He says the soldiers were simply in
the wrong place at the wrong time: 'They were on the road hitching a
ride and they saw this car driving by. They asked for a ride and then
this guy stopped, and later on this car was stopped and they were
arrested. You don't have any evidence of high-level involvement. Just
please, bring the evidence. That's what we're asking for.'

Government spokesman Pedro da Costa gives a similar response when
asked if the government is involved in the drugs trade. 'I don't have
any information on that,' he says, curtly. He insists the authorities
are keen to tackle drugs traffickers, but don't have the resources.
Like many others in Guinea-Bissau, though, he's worried that disputes
over control of the trade could break out, pushing the country back
to civil war. 'We're worried, of course. We're all concerned. If it's
going to bring consequences to our people similar to the war of
1998-99, I think today the motivation would be different. But of
course, there is a danger for the country.'

Parliamentary elections, originally scheduled for this month, have
been postponed until the end of the year. The campaign could lead to
heightened tension between political groups, and provide more scope
for corruption. 'One of the risks now is that they will have a deep
penetration of dirty money into politics that will overturn
everything in the country,' says Fafali Kudawo, rector of the
country's first university, 'because this country is very, very
fragile, and he who has money can do whatever he wants. You do not
know at any given moment what will change the situation or lead the
country to war or to violence'.

The UNOCD Office has drawn up a detailed plan to help Guinea-Bissau.
In 2006 it suggested a possible budget of several hundred million
dollars to potential donors. They refused to pay. Last year the
agency came up with a far more modest programme concentrating on
reform of the security services, boosting the judicial police, and
building a jail. The estimated cost was $19 million. In December a
donor conference in Lisbon produced pledges of $6.5m.

As though the suffocation of society by the cartels were not enough,
Guinea-Bissau inevitably suffers from a proliferation of addiction
among its own people. 'Foot soldiers are paid in kind,' says Antonio
Maria Costa, 'and whatever is left behind is sold domestically.' With
addicts hidden away in villages, many still believe that their
hallucinations are the result of evil spirits.

When United Nations workers went to the country's only excuse for a
rehabilitation unit in a mangrove swamp 30km from the capital, they
found a man called Bubacar Gano, who calls himself 'the first man to
smoke pedra' - as crack cocaine is known in the country. He recalls
the fishing boat that lost its load in the sea in 2005, saying: 'Most
of the locals who found the packages had no idea what it was or what
to do with it. But I knew. After a while I became crazy and
aggressive. But it is a difficult thing to stop smoking pedra.'

. Grant Ferrett is a BBC corrrespondent who has worked extensively in Africa.

Guinea-Bissau factfile . Sandwiched between Senegal and
Guinea-Conakry, Guinea-Bissau is a tiny wedge of land, largely
composed of mangrove swamps and islets, and an archipelago of 90 islands.

. Colonised in the 16th century, it broke away from Portuguese
control in 1974 after a 12-year struggle for independence. During the
Eighties and Nineties, the presidency of Joao Bernardo Vieira brought
a measure of stability to the country but little development.

. The capital, Bissau, remains hazardous. Unexploded ordnance
continues to be found, even though it was declared a 'mine-free' zone
in 2006. New mines were laid recently by rebels fighting over the
Casamance area to the north.

. Guinea-Bissau's roaring drugs trade sees an estimated one tonne of
pure Colombian cocaine a day leave the country, most of it en route to Europe.