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War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US

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By Prof Michel Chossudovsky; Originally appeared at Global Research

Afghanistan’s opium economy is a multibillion dollar operation which has a direct impact on the surge of  heroin addiction in the US.  

Despite president Trump’s announced US troop withdrawal, the Afghan opium trade continues to flourish. It is protected by US-NATO occupation forces on behalf of a nexus of powerful financial and criminal  interests. 

In 2004,  the proceeds of the Afghan heroin trade yielded an estimated global revenue of the order of 90 billion dollars. This estimate was based on retail sales corresponding to a total supply of the order of 340,000 kg of pure heroin (corresponding to Afghanistan’s 3400 tons of opium production) (See Michel Chossudovsky, America’s War on Terrorism, Chapter XVI, Global Research, Montreal 2005)

Today a rough estimate based on US retail prices suggests that the global heroin market is above the 500 billion dollars mark. This multibillion dollar hike is the result of a significant increase in the volume of heroin transacted Worldwide coupled with a moderate increase in retail prices.

Based on the most recent (UNODC) data (2017) opium production in Afghanistan is of the order of 9000 metric tons, which after processing and transformation is equivalent to approximately 900,000 kg. of pure heroin.

With the surge in heroin addiction since 2001, the retail price of heroin has increased. According to DEA intelligence, one gram of pure heroin was selling in December 2016 in the domestic US market for $902 per gram.

The Heroin trade is colossal: one gram of pure heroin selling at $902 is equivalent to almost a million US dollars a kilo ($902,000) (see table below)

War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US

Flash back to to 2000-2001.

In 2000, the Taliban government with the support of the United Nations implemented a successful drug eradication program, which was presented to the UN General Assembly on October 12, 2001, barely a week after on the onset of US-NATO invasion. Opium production had collapsed by 94 percent.

In 2001 opium production had collapsed to 185 tons down from 3300 tons in 2000. (see Remarks on behalf of UNODC Executive Director at the UN General Assembly, Oct 2001, excerpt below)


War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US


The US-NATO led War against Afghanistan served to Restore the Illicit Heroin trade

The Afghan government’s drug eradication program was repealed.  The 2001 war on Afghanistan served to restore as well as boost the multibillion dollar drug trade. It has also contributed to the surge in heroin addiction in the US.

Opium production had declined by more than 90 per cent in 2001 as a result of the Taliban government’s drug eradication program.

Immediately following the invasion (October 7, 2001) and the occupation of Afghanistan by US-NATO troops, the production of opium regained its historical levels.

In fact the surge in opium cultivation production coincided with the onslaught of the US-led military operation and the downfall of the Taliban regime. From October through December 2001, farmers started to replant poppy on an extensive basis.” (see Michel Chossudovsky, op cit.)  

Since 2001, according to UNODC, the production of opium has increased 50 times, reaching 9000 metric tons in 2017. (See Figure 1 below)

War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US

Heroin Addiction in the US

Since 2001, the use of heroin in the US has increased more than 20 times. Media reports rarely report how the dramatic increase in the global “supply of heroin” has contributed to “demand” at the retail level.

There were 189,000 heroin users in the US in 2001, before the US-NATO invasion of Afghanistan. By 2012-13, there were 3.8 million heroin users in the US according to a study by Columbia University Mailman School of Public Health. Extrapolating the 2012-2013 figures (see graph below), one can reasonably confirm that the number of heroin users today (including addicts and casual users) is well in excess of four million.

War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US

In 2001, 1,779 Americans were killed as a result of heroin overdose. By 2016, the number of Americans killed as a result of heroin addiction shot up to 15,446. (see graph below)

“My Administration is committed to fighting the drug epidemic” says Donald Trump.

Those lives would have been saved had the US and its NATO allies NOT invaded and occupied Afghanistan in 2001. 

The first thing they did was to undermine the drug eradication program, restore the opium economy and the drug trade.

War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US

Source: National Institute of Drug Abuse

Opium production has increased 50 times in relation to 2001 (following the Afghan government’s drug eradication program). In 2001, the areas of opium cultivation had fallen to 8000 hectares (185 metric tons of opium).

According to the UNODC, Afghanistan produces (2007) 93% of the illegal “non-pharmaceutical-grade opiates” namely  heroin.

War is Good for Business and Organized Crime: Afghanistan’s Multibillion Dollar Opium Trade. Rising Heroin Addiction in the US

MARJAH, Helmand province, Islamic Republic of Afghanistan – Corporal Mark Hickok, a 23-year-old combat engineer from North Olmstead, Ohio, patrols through a field during a clearing mission April 9. Marines with Company B, 1st Tank Battalion, learned basic route clearance techniques from engineers like Hickok, who are deployed with 1st Combat Engineer Battalion. (U.S. Marine Corps photo by Cpl. John M. McCall)

The 2017 Afghanistan Opium Survey (released in May 2018) by UNODC confirms that the farm areas allocated to opium are of the order of 328,000 hectares with opium production in excess of 9,000 tons.  

War is good for business. It contributed to spearheading heroin use. The Afghan opium economy feeds into a lucrative trade in narcotics and money laundering.

It is worth noting that in 2010 UNODC modified the concepts and figures on opium sales and heroin production, as outlined by the  European Monitoring Centre for Drugs and Drug Addiction (EMCDDA).

UNODC estimates that a large proportion of the Afghan opium harvest is not processed into heroin or morphine” (UNODC, 2010a). …EU drug markets report: a strategic analysis, EMCDDA, Lisbon, January 2013 emphasis added.

What this new methodology has done is to obfuscate the size and criminal nature of the Afghan drug trade, intimating –without evidence– that up to 20% of Afghan opium is no longer channeled towards the illegal heroin market.

More than Half a Trillion Dollars

The profits are largely reaped at the level of the international wholesale and retail markets of heroin as well as in the process of money laundering in Western banking institutions, an issue which is not addressed by the Vienna based UNODC.

The global monetary value of the heroin market (which is protected by powerful groups) is colossal.

Estimation

The retail price of heroin (sold by the gram) can vary dramatically from one country to another, it also depends on the percentage of pure heroin. This does not facilitate the process of estimating the monetary value of the global trade in heroin.

Recorded retail street prices for heroin with a low level of purity must be converted to a dollar value which corresponds to pure heroin.

What is sold at the street level usually has a low percentage of pure heroin. The process of estimation requires transforming the street level prices into what the DEA calls heroin price per gram pure (PPG)

From one ton of opium you can produce 100 kilos of pure heroin. The US retail prices for heroin (with a low level of purity) was, according to UNODC (2012) of the order of $172 a gram (namely $17,200 per kilo)

The estimated price per gram of pure heroin, however, is substantially higher.

In December 2016, the heroin price per gram pure (PPG) was of the order of $902 in the US, according to DEA intelligence  ie. $90,200 a kilo.

Higher Heroin Prices in the UK

In the UK which is the entry point of Afghan heroin into the EU market, the recorded retail price (according to a 2015 estimate) is substantially higher than that estimated for the US market by the DEA:

“An imported kilo [of heroin] cut at 25% street purity provides enough raw material for 16,000 individual deals at £10 a hit – pushing the takings to £160,000 [a kilo]. (The Guardian, December 20, 2015)

Rough Estimate of the  Monetary Value of  Afghanistan’s Global Heroin Market

According to the UNODC, 7600-7900 tons of opium were available for heroin production and export (out of a total of 9000-9300 metric tons). According to the UNODC, approximately half of the opium is processed into heroin within Afghanistan.

The global monetary value for heroin can be roughly estimated using the US price equivalent PPG measurement for pure heroin of US 902,000 a kg. (December 2016, DEA) and the (lower) production figure of 790,000 kg of pure heroin (estimated by the UNODC).

Using the US retail price equivalent of pure heroin (DEA), the global monetary value generated by the Afghan heroin trade (2017) is of the order of  $712,580,000,000 (712.58 billion dollars), an amount equivalent to the US defense budget.

This is a conservative estimate based on adopting the “lower figure” of 7900 metric tons (2017)  (recommended by the UNODC methodology which is arbitrary and questionable, see above).

If we had based the calculation on the total production of opium which is in excess of 9ooo metric tons (2017), the global monetary value of the heroin market would have been in excess of $800 billion. It should also be mentioned that this estimate relies solely on the the US price for pure heroin (DEA).

Back in August 2018, President  Trump signed the 2019 National Defense Authorization Act “which authorizes a top-line [defense] budget of $717 billion”, just a few million dollars in excess of the estimated global monetary value of the Afghan heroin market.

The global monetary value of the heroin market is of the same order of magnitude as the defense budget of the USA.

Needless to say, the Pentagon not to mention the CIA which launched the opium economy in Afghanistan in the late 1970s  are intent upon protecting this multibillion dollar industry. The proceeds of the Afghan drug trade were initially used to finance the recruitment of Al Qaeda Mujahideen mercenaries to fight in the Soviet-Afghan war.

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  • Sinbad2

    Since WWII the USA has controlled all drugs, legal and illegal.
    Most people don’t know that prior to WWII Indonesia was the largest supplier of cocaine.
    The US made Indonesia destroy all its coca plants, and made all drugs deemed illegal by the US to be made illegal in Indonesia.
    I think they did that, so the US could control the global supply of cocaine via its colonies in South America.

  • Barba_Papa

    I don’t subscribe to conspiracy thinking, I’m a firm believeer in Occam’s Razor, always go for the simplest most plausible explanation. The US has instituted major drug production eradication programs in other countries, like in Latin America. It hasn’t in Afghanistan. So what could be the difference? For one the US isn’t fighting (directly) in Latin America, it is in Afghanistan. It wants to win hearts and minds the locals, it can’t do that when it destroys the economic livelyhood of the locals. This is what Dutch veterans, who fought in Afghanistan, kept saying. The Pentagon is an extremely myopic organization. It’s interested in winning wars and geo-strategic concerns. The fact that 3.8mn Americans use heroin doesn’t interest the Pentagon in the slightest. As long as current army personnel isn’t using it it doesn’t care what happens to them once they leave the service. I reckon the DEA would love to institute similar drug eradication programs in Afghanistan as that is has managed to run in Latin America, but I reckon the Pentagon and State Department told it to fuck off.

    That’s whats seems more plausible and simple to me then nefarious shadow policies by secret government cabals. Believe otherwise if you want too, we’ll agree to disagree.

    • verner

      believe what you want, making it simple doesn’t make it more true. remember air america (?) during the vietnam war, cia’s transport operation of opium out of certain areas to avoid that the growers joined in on the nv-side and then you have the iran/contras with coke for guns, also cia. and now a massive production increase of opium in a country presently under occupation by the moronic states and you think that the morons just let the peasants keep growing their stuff to avoid the peasants getting upset and not giving one flying f..uck about where the thousands of tons of horse ends up. it’s part of the operation to find some easing on the financial side of the operation and horse/smack is just such alleviation for a hard pressed pentagon/cia/nfl/nba/nhl/and others!!!!

    • Tommy Jensen

      So Pentagon is doing it for winning hearts and the minds of the locals?

      • Barba_Papa

        If you’re an Afghan farmer who wants to make any money to feed his family then growing poppies is basically the only option you have. There is no other other cash crop to be grown that’s a viable alternative to them. So if you, the Pentagon, wants to fight the Taliban and not piss off the locals, you’re not going to do much to take away the only livelyhood of those locals. Even though I can imagine there would be many a US soldier or commander who would love to torch those fields if allowed too. Because they damn well know where that stuff will end up.

        And that’s why rules of engagement exist.

    • 81dave81

      The Truth, http://thewe.cc/

  • Hasbara Hunter

    USRAEHELL THE WORLD’S BIGGEST GLOBAL CRIMINAL ORGANISATION

  • Rodger

    “The global monetary value for heroin can be roughly estimated using the US price equivalent PPG measurement for pure heroin of US 902,000 a kg.”
    You’ve got to be high to believe that, really really high.
    A kilo of about 14% pure heroin goes for about $5500,- in the UK making a kilo of pure heroin 1/0.14 * $5500,- = $39.300 dollars. After that the whole story is just ripe for the shitter.
    https://www.unodc.org/unodc/secured/wdr/Prices_Opioids.pdf

    • Ronald

      PPG, or price per gram is the street sale price (retail), but ‘the profits are largely reaped at the level of international and retail markets” (wholesale).

      In other words the street sale price is far higher than the wholesale price.

      Lets accept your price in the UK at $39,000/kilo, or 20,000/lb..

      The wholesale price in the US is $50,000/kilo plus, plus for ‘smaller’ volumes.

      The price in Afghanistan or Pakistan is $1000/lb., or 2000/kilo.,

      So a minimum profit (in the UK) of $37,000./kilo. is still a staggering profit.

      Read “Air America the Story of The CIA’s Secret Airlines” by Christopher Robbins.
      You would have to be in the business to really know prices, and while the author’s price estimates are exaggerated upwards, real production numbers are up by multiple sources.

  • Ross

    Bagram to Bondsteel. A US airbase in the country which supplies 93% of the world’s heroin to a US airbase in Kosovo, Europe’s main heroin distribution centre. Hey, it’s business, get over it!

  • Tommy Jensen

    “Afghanistan’s” Multibillion Dollar Heroin Trade = US/NATO Multibillion Dollar Heroine Trade.

    This is it folks! Prof. Michel Chossudovsky, Southfront and I have now done the hard research, the hard work and told you guys the hard truth.

    Hereafter its up to YOU to wake up and do something! If YOU sheeple dont WAKE UP and do something now, all you and your neighbours children will be on heroine before you morning coffee is finished and this is YOUR fault, not our fault because we have done OUR work!

    Wake up you lazy leakers and do something!!

    • 81dave81

      The Global populations will do nothing, as they believe their Gawd’s will save them.
      The proof lies in this question which no one will answer,
      “Exactly what will You no longer allow You and Your family to suffer ?”
      The sound of crickets. They also believe in the decieving non extaint ” We ”

  • NobodysaysBOO

    ok heads up nancy our new speaker of the house,your turn at bat!
    legalise it all,take the money,open the borders,use the immigrants.
    after the following die off, property will be cheap.

  • Black Spot

    Questions to answers you arent even thinking to ask. Watch it all the way through, you wont be disappointed. Use pause if you have to. https://www.youtube.com/watch?v=G6MVTMLcglg