ILLEGAL DRUGS: A COMMON THREAT TO THE GLOBAL COMMUNITY

Too many nations have made the mistake of underestimating the nature of the
threat posed by illegal drug cultivation, production, trafficking, and
consumption. Governments that have tolerated the cultivation of coca or
opium poppies have seen deforestation and distortion of the agricultural
sector. Nations where drugs are produced or trafficked have seen their
financial sectors and political institutions wracked by economic distortion
and corruption. Consuming countries have witnessed addiction and its
terrible criminal, health, and social consequences. No nation is immune
from this transnational threat. Nor can any nation stand up to the problem
unilaterally. Bilateral and multilateral responses to this international
cancer have yielded encouraging results, particularly in the Western
Hemisphere. The United Nations, through the activities of its International
Drug Control Programme, the actions of its International Narcotics Control
Board, and the upcoming General Assembly's Special Session on Drugs, is a
key component of the global response to this common threat.

1997 was a good year for international drug-control efforts, particularly
in the Western Hemisphere. Appreciable gains were made in crop reduction,
in interdiction, in weakening trafficking syndicates, strengthening law
enforcement, and in targeting drug money laundering. The year's best news
came from Peru, for years the world's largest coca growing country.
Three-plus years of joint efforts by U.S., Peruvian, and Colombian forces
to choke off the "air bridge" that carries Peruvian cocaine base to
Colombia for processing paid off handsomely. The operation simultaneously
deprived Colombian trafficking organizations of critical basic materials
and drove down the price of coca leaf in Peru below the break-even point.
Disillusioned Peruvian growers abandoned fields to take advantage of
alternative development opportunities. As a result of the exodus, in 1997
Peruvian coca cultivation dropped 27 percent, an extraordinary decline that
occurred on top of last year's 18 percent reduction.

The U.S. estimates that Peru now cultivates 68,800 hectares of coca, just
slightly more than half of the estimated 129,100 hectares identified in the
peak year of 1992. Bolivia's 1997 coca crop was also the smallest in ten
years; a result of its government's determination to confront the drug
trade. Colombia was a different story, since successful coca control
operations also spurred new planting. Colombian traffickers accelerated
their campaign to plant new coca outside the traditional growing areas,
both to offset heavy losses from government eradication missions and to
replace cocaine supplies cut off by the "air bridge" denial. With 79,500
hectares under cultivation at year's end, Colombia is now the largest coca
cultivating country. Still, even taking into account the expansion in
Colombia, this year's Andean coca cultivation total of 194,100 hectares was
the lowest in a decade -- proof that persistence pays.

The global community faces a different set of challenges in trying to limit
the cultivation of opium poppy, the source of heroin. This heavily
addictive drug is gradually staging a comeback among a new generation of
users in the United States and elsewhere. Unlike coca, which currently
grows in only three Andean countries, opium poppy grows in nearly every
region of the world. Because it is an annual crop with as many as three
harvests per year, it is much harder to eliminate, especially since nearly
90 percent of the world's estimated opium gum production (3,630 out of
4,137 metric tons) is produced in Burma and Afghanistan, countries where
the international community has limited influence.

Though we can take pride in our collective accomplishments, we are still a
long way from permanently crippling the drug trade. As one of the pillars
of international organized crime, it remains a formidable enemy. Well
before transnational crime had become recognized as one of the principal
threats to international stability, the drug syndicates already had in
place an impressive network of supply centers, distribution networks,
foreign bases and reliable entree into the governments of source and
transit countries. They pioneered many of today's sophisticated money
laundering techniques, hiring first-rate accountants, and investing in
state-of-the-art technology. And when the former Soviet Union collapsed,
the drug syndicates were quick to recruit Eastern European chemists and
other technical specialists left unemployed by the change in political
systems. Even after suffering considerable losses, the drug trade's wealth
(estimated by UNDCP at close to $500 billion a year), power, and
organization exceed the resources of many governments.

Despite our collective efforts to cut drug traffic in 1997, hundreds of
tons of cocaine flowed not only to the United States and Western Europe,
but to markets in Latin America, Asia, Africa, and the countries of the
former Soviet Union. Colombian cocaine syndicates have established
distribution centers on every continent, as international drug trafficking
becomes more sophisticated every year. Now Italian, Turkish, Russian, and
Nigerian crime syndicates, to name but a few, vie for a share of the
business. The relatively straightforward flow-charts of trafficking routes
of a decade ago have been replaced by a complex web of nodes and lines
linking virtually every country in the world to the main drug production
and trafficking centers.

The drug trade is adept at searching out and adapting to new opportunities.
It is taking advantage of shifts in enforcement initiatives, along with
trafficking and consumption patterns, as the lines blur between cocaine and
heroin-consuming countries. We are now observing more dual drug use, with
addicts combining cocaine and heroin to offset each drug's respective
stimulant and depressant effects. National tastes are also changing.
Europe, once the preserve of the heroin trade, has developed an unhealthy
and growing appetite for cocaine. This is especially true for Eastern
Europe and Russia, where cocaine sells for up to $300 per gram, three times
the average cost in the US. North America, in turn, has rediscovered
heroin, as cocaine use has declined sharply. (Between 1985 and 1996, the
number of cocaine users dropped 70 percent, from 5.7 million to 1.7 million
estimated users.) Although heroin use has not been rising proportionately,
the Colombian drug syndicates' major investment in heroin production
indicates that they foresee an important market for heroin in the U.S.,
most likely by promoting dual use of cocaine and heroin by consumers. Given
the drug trade's past successes in anticipating trends, this is a
disturbing development.

We have also witnessed an evolutionary process in the way drug syndicates
are conducting their international operations. In the 1980's, Mexican
trafficking organizations provided the Colombian trafficking syndicates
with drug transportation services from Mexico to the Southwest region of
the United States. The Colombians paid the Mexican trafficking
organizations from $1,500 to $2,000 for each kilogram of cocaine smuggled
into the United States. During the 1990's, the Colombian and Mexican
trafficking organizations established a new arrangement allowing the
Mexican organizations to receive a percentage of the cocaine in each
shipment as payment for their transportation services. The
"payment-in-product" agreement enabled Mexican organizations to become
involved in the wholesale distribution of cocaine in the United States.
Prior to this, the U.S. wholesale cocaine trade was controlled exclusively
by the Colombians.

The drug trade, while powerful, is far from omnipotent. It is vulnerable on
many fronts. It needs raw materials to produce drugs, complex logistic
arrangements to move them to their destination, cadres of professionals to
run the technical and financial aspects of its operations, and some means
of making its profits legitimate. Above all, it needs the protection of a
reliable core of corrupt officials in all the countries along its
distribution chain. Repeated attacks on every front, even if seemingly
insignificant by themselves, cumulatively are responsible for keeping the
drug trade in check. Viewed out of context, the many achievements of
individual countries may seem insignificant. Many never come to the
attention of the press. The routine drug seizures, the jungle drug labs or
airstrips destroyed every day, the arrests of corrupt officials, or the
improved performance of courageous police and judicial authorities receive
at best only fragmentary coverage in world media. Yet, as we have seen,
cumulative effort and cooperation pay off. Ultimately it will be the sum of
these small steps that will allow us to make lasting gains at the drug
trade's expense.

The most powerful weapon in fighting the drug trade is an intangible:
political will. A first-class anti-drug force, equipped with
state-of-the-art police and military hardware, cannot succeed without the
full commitment of the country's political leadership. Where political
leaders have had the courage to sacrifice short-term economic and political
considerations in favor of the long-term national interest, we have seen
the drug trade weaken. Where they have succumbed to the lure of ready cash,
the drug syndicates have prospered accordingly.

Contrary to the image that the large drug syndicates cultivate, they are
far from invincible. The syndicates' prosperity hinges on establishing a
modus vivendi with a weak or complacent government. In exchange for the
short-term benefits of large infusions of drug money into the economy (or
into their personal or political treasuries), corrupt government officials
can limit counternarcotics operations to those sectors least likely to harm
trafficking interests. For example, the government of a major drug
cultivation country can focus on interdiction rather than eradication. In a
major drug refining country government forces may eradicate some crops
while allowing drug syndicates to exploit corrupt enforcement and timid
judicial systems. In offshore financial centers, officials may launch
anti-trafficking campaigns, while promoting bank secrecy and lax
incorporation laws that facilitate money laundering. In every instance, the
price of these short-term gains is the long-term entrenchment of drug
interests. Consequently, a basic objective of U.S. antidrug policy is to
prevent drug interests from becoming entrenched by strengthening political
will in key source and transit countries. For where political will is weak,
corruption sets in, vitiates the rule of law, and puts democratic
government at risk.

When we fight the drug trade we are also fighting political corruption. The
drug trade feeds upon the social, economic, and moral decay that corruption
fuels. Drug syndicates wield a powerful instrument for subverting even
relatively strong societies: a money machine. Like modern-day Midases, they
transform an intrinsically cheap and available commodity (e.g., coca
leaves) into an almost inconceivably remunerative product. In terms of
weight and availability, there is currently no commodity more lucrative
than drugs. They are relatively cheap to produce and offer enormous profit
margins that allow the drug trade to generate criminal revenues on a scale
without historic precedent.

Assuming an average retail street price of one hundred dollars a gram, a
metric ton of pure cocaine has a retail value of $100 million on the
streets of a U.S. city -- two or three times as much, if the drug is cut
with adulterants. By this measure, the one hundred or so metric tons of
cocaine that U.S. law enforcement agencies typically seize each year are
theoretically worth as much as $10 billion to the drug trade -- more than
the gross domestic product of many countries. Even if only a portion of
these profits returns directly to the drug syndicates, we are still
speaking of hundreds of millions, if not billions, of dollars. To put these
sums into perspective, the overseas component of the U.S. government's
budget for international drug control operations is approximately one and a
half billion dollars. In dollar terms, that equates to approximately
fifteen metric tons of cocaine; the Mexican drug cartels have lost that
much in a shipment or two and barely felt the loss.

Such inordinate wealth gives the large trafficking organizations an almost
unlimited capacity to corrupt. In many ways, they are a less obvious threat
to democratic government than many insurgent movements. Guerrilla armies or
terrorist organizations openly seek to topple and replace governments
through overt violence. The drug syndicates only want to manipulate
governments to their advantage and guarantee themselves a secure operating
environment. They do so by co-opting key officials. A real fear of
democratic leaders should be that one day the drug trade might take de
facto control of a country by putting a majority of elected officials,
including the president, directly or indirectly on its payroll. Though it
has yet to happen, there have been some disquieting near-misses. By keeping
the focus on eliminating corruption, we can prevent the specter of a
government manipulated by drug lords from becoming a reality.

Demand reduction must also be an integral part of the global response. The
need for demand reduction is obvious, since escalating drug use and abuse
continue to take a devastating toll on the health, welfare, safety,
security, and economic stability of all nations. In the United States,
illegal drugs kill 20,000 of our citizens and cost our society almost
seventy billion dollars every year. Changing patterns of drug abuse,
supply, and distribution compound the problem, at the same time as
international drug syndicates and gangs are carrying out ever more
ruthless, vigorous, and sophisticated marketing techniques and strategies.

The U.S. response has been a comprehensive, balanced, and coordinated
approach in which supply control and demand reduction reinforce each other.
Our demand reduction strategy integrates a broad spectrum of initiatives.
These include efforts to prevent the onset of use, intervention at
"critical decision points" in the lives of vulnerable populations to
prevent both first use and further use, and effective treatment programs
for the afflicted and addicted. Other aspects encompass education and media
campaigns to increase public awareness of the deleterious consequences of
drug use/abuse and community coalition-building. Coalitions are necessary
in order to mobilize public and private social institutions, the faith
community, and law enforcement entities in targeted campaigns against
drugs. Our national strategy also provides for evaluations of the
effectiveness of these efforts and for research studies to find better ways
of reducing demand.

The results suggest that we are on the right path -- that of multilateral
cooperation. In the year ahead, we will build upon past gains by pressing
the drug trade at every point -- targeting drug syndicates, reducing drug
cultivation, destroying labs, disrupting the flow of the necessary
processing chemicals, interdicting large drug shipments, and attacking drug
money flows. Though we cannot neglect any stage in the process, we know
that we can inflict the most lasting damage at the crop cultivation and
financial operations stages. We have seen over the past year how
cooperative ventures can pay off in reducing drug crop cultivation. Now we
must strengthen these programs and beef up our collective efforts to obtain
comparable gains against the illegal drug conglomerates' financial
operations.

The international antidrug effort has too much at stake to give up any of
the precious gains we have made in the past few years. As one of the
countries most affected by illegal drugs, the United States will continue
to provide leadership and assistance to its partners in the global antidrug
effort. Yet ultimately the success of this effort will hinge not on any one
nation, but on the collective actions, commitment, and cooperation of the
other major drug-affected governments. The United States will help where we
can, but each government must muster the necessary political will to shield
its national sovereignty from drug corruption by enacting effective
anti-drug legislation and protecting its judicial, law enforcement, and
banking institutions. In democracies, the drug trade flourishes only when
it can divide the population and corrupt institutions. It cannot withstand
a concerted, sustained attack by a coalition of nations individually
committed to its annihilation. It is that precisely this kind of coalition
that can make a difference. The United Nations, the Organization of
American States, the European Union, and other multilateral organizations
must continue to be a part of the global response.

Checked-by: Richard Lake