A DRUG TRADE PRIMER FOR THE LATE 1990S

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 "tradi-tional," "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
traffick-ing. During the 198()s 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 car-tel 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 vulner-able 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 car-tels-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 net-work~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 Amer-ica 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 becom-ing 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 num-ber of victims of the recession in
both the third world and the major urban centers of developed countries,
where narcotics production and traffick-ing 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 high-lighted 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 Colom-bia (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 West-ern 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 under-paid 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 sup-plies
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 manu-facturing 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 syn-thetic 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 labora-tories, 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 coex-ist alongside the "classic" use of drugs derived from
plants.

Checked-by: jwjohnson@netmagic.net (Joel W. Johnson)