The Narco Economy
Afghanistan is considered the world's largest opium producing country. At what cost is it pursuing this activity?
Opium, a narcotic drug that is obtained from the unripe seedpods of the opium poppy is one of the world’s oldest pain relievers. Statistics suggest that Afghanistan is the world’s leading opium-producing country with Burma and Laos ranking second and third, respectively.
Traditionally, illegal opium production thrives on war economies and poverty. Afghanistan provides ideal circumstances for poppy production, especially following the invasions of the Soviet Union and the United States. However, since the 2001 U.S. invasion and the lifting of the opium ban placed by the Taliban regime, Afghanistan’s share in the crop’s production has increased from 70 percent of the overall global illegal opium production to 92 percent.
There are reasons for this rapid increase.
To start with, it is important to note that opium has a history in this region, dating back to the promotion of its cultivation and globalization of its trade by the British in India. In the 1960s and 1970s, opium cultivation shifted to Southeast Asia, a decade later to Turkey and Pakistan and then to Afghanistan.
Secondly, and perhaps more importantly, the opium market is driven by demand. The demand is largely, and evenly, concentrated in the east and west. While recording demand it is important to take into account the fact that there is also a legal market for opium. This market largely comprises pharmaceutical companies as opium is considered a source of morphine – still the most effective painkiller in the world.
With opium being in legal demand, Afghanistan takes advantage of the opportunity due to its status of being the highest opium producing country in the world.
In the grand scheme of affairs, Afghanistan’s opium-driven economy speaks much about the state-building process in the country. Opium arguably has done more than anything else to reduce poverty, drive the rural economy upwards and, perhaps more controversially and surprisingly, support conflict resolution processes.
However, while Afghanistan produces opium in high volumes, there is a need to accurately gauge its consequences. First, there is no doubt that opium poppy is considered the best form of ‘cash transfer’, which means it has done more to reduce income poverty and assure food security than anything else on offer.
The growth of the opium economy has had important multiplier effects on the rural economy, creating access to land and employment both on and off the farms. There is no other crop that could have done this. It can be argued that opium has arrested a historical trajectory: it has kept people attached to the rural economy.
Furthermore, opium certainly has been a lubricant for the existing social structures, since it assists conflict resolution processes and eases the underlying social tensions between different ethnic and social groups.
It has also supported the rise of a shadow state, where the distinction between using the official position for the public good and private gain merges. But one needs to be careful while separating the pre-existing patterns and structures of bureaucratic
behavior which have always been distinctly patrimonial in Afghanistan (which some would refer to as government by relationships) from the direct consequences of the opium economy.
While Afghanistan’s opium economy seems to have experienced a skyrocketing rise in recent years, certain policy responses and interferences also need to be analyzed. It is said that U.S. foreign policy supports the workings of “a thriving criminal economy in which the demarcation between organized capital and organized crime has become increasingly blurred.”
The heroin business is not “filling the coffers of the Taliban” as claimed by the U.S. government and the international community. Quite the opposite, a large part of the proceeds from this illegal trade are a source of wealth for powerful business and criminal interests in western countries. These interests are sustained by U.S. foreign policy.
Afghanistan's economy has evolved to the point where it is now highly dependent on opium. Today 2.9 million Afghanis from 28 provinces of the country are involved in opium cultivation in one way or another. This figure represents about 10 percent of the population.
Although Afghanistan's overall economy is being boosted by opium profits, less than 20 percent of the profits actually go to the farmers, while more than 80 percent are pocketed by opium traffickers and the big names involved in the business. Even heftier profits are generated outside Afghanistan by international drug traffickers and dealers. Hence Afghanistan seems to be handicapped as it cannot fully exploit the substantial profits gained by the mass production of opium.
One of the most important arguments is that the Afghan drug economy is seen as “protected.” The heroin trade was a part of the war agenda. What this war has achieved is to restore a compliant narco-state. Now, the powerful financial interests behind narcotics are supported by the militarization of the world’s major drug triangles (and transshipment routes).
While Afghanistan is considered the world’s largest opium producing country, it needs to be seen at what cost it is pursuing this activity. That opium is supported and nurtured as a tradable commodity in Afghanistan is a fact. But is it the only worthwhile commodity that this country produces? This is a question that the Afghanis themselves need to explore.