Crime, Law & Social Change 27: 121–138, 1997.

121
c 1997 Kluwer Academic Publishers. Printed in the Netherlands.

The dynamics of illicit drugs production: Future sources and

threats

SHONA MORRISON
Office of Strategic Crime Assessments, Commonwealth Government of Australia

Abstract. This paper examines the opportunities for illicit drugs production which arise out
of the economic, political and social conditions of some countries. These drivers can help
us to understand the geographical pattern of global drugs sources and assist in the process
of identifying those parts of the world in which new production opportunities are arising. It
was found that there is not a homogenous set of risks which contributes to drugs production.
Instead, the particular contexts which are conductive to drug production activities varies for
different drug types. This has influenced the different patterns of drugs production for highly
refined, organic drugs, such as cocaine and heroin, compared to synthetic drugs. The nature of
developments which could trigger new areas of drug production are discussed.

Introduction: the need for a strategic approach

In the tradition of United States’ drugs policy, many consumer countries have
attempted to deal with their domestic drugs problems by trying to cut off
the flow of illicit substances at the, usually foreign, source.1 Strategies to
achieve this have varied from direct interference (military force), to coercion
(aid reduction), to assistance provision (crop substitution). The main barrier
to success of all of these strategies is their ineffectiveness in addressing the
conditions that led to the establishment of those regions as drug producing
areas in the first place.
Many published reports and books tell us where drugs come from but few
explain why those countries or regions have become major sources of illicit
drugs. Do some parts of the world have characteristics which attract illicit
drugs production? Can we recognise the pre-conditions for successful drug
supply? The context in which drugs production is able to take place must
yield opportunities which facilitate this activity and its associated processes.
By studying the economic, political and social contexts in which drugs pro-
duction take place, we will be able to identify parts of the world in which
new production opportunities are arising and which are, therefore, at risk of

 The views presented here are those of the author and not of the Office of Strategic Crime
Assessments or the Commonwealth Government of Australia.
122 SHONA MORRISON

becoming the “narco-states” of the 21st century. Thus, information about the
dynamics of illicit drug production will provide useful data to policy-makers
who have been charged with the difficult task of developing appropriate pre-
ventive strategies dealing with potential illicit drug sources.
The specific requirements of crops generally for sunshine, rainfall, and soil
nutrients influence the range of locations in which they can be grown, and,
of course, less than ideal conditions lead to diminishing quality of the end-
products and lower yields. Illicit drug crops also thrive in sunny, wet climates,
however, few further requirements have been documented.2 The range of
locations for crop cultivation has spread, furthermore, due to advances in
agricultural technology (this is discussed in greater detail later). Overall, the
cultivation of organic drugs would be possible, geographically, in a much
broader range of regions than those in which it actually takes place. The
barriers to production are generally legal and political ones, thus, the focus of
the following discussion is not upon the climatic drivers of drug production,
but the context in which that activity takes place.
The following discussion identifies the forces which appear to underpin
drug production for each of the four main drug groups, cannabis, heroin,
cocaine and synthetic drugs. The findings are used to develop a model of
drug sources and to assess the relative risk of potential drug producing loca-
tions. Finally, developments which could encourage drug production in those
countries are discussed.

Driving forces of illicit drug production

Cannabis

The industries supplying herbal cannabis and more refined products, such
as hashish and oil, have separate and distinct patterns of production. The
herbal cannabis industry appears to have flourished in spite of prohibition in
almost every social, political, and economic climate. Hashish and cannabis
oil industries, on the other hand, are more highly concentrated in certain parts
of the world.
Few factors limit the cultivation of cannabis plants, although the quality can
vary considerably from place to place. Larger outdoor plantations may have
particular requirements for sun, irrigation and isolation (to avoid detection),
but smaller intense plantations are now being grown indoors with the assis-
tance of hydroponic technology. These developments have made the cannabis
business a highly flexible industry with few requirements beyond the initial
raw materials. However, the fact that the production of refined cannabis resin
or oil is less common suggests a need for additional requirements.
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 123
Some locations, presumably, possess some advantages which have assisted
the producers of cannabis resin and oil to establish their industries. While
geographical conditions and crop strains are some of the elements required to
produce high quality cannabis, other factors can also assist these industries to
develop. In the Lebanon, political instability and lack of government control
over some areas has been recognised as an important element behind the
production of illicit cannabis and other dugs.3 In Morocco, cannabis is grown
in remote northern mountains and is the main source of income for around
a quarter of the population. Corruption is believed to be an important factor
in the Moroccan industry’s success.4 Pakistan and Thailand also produce
cannabis resin. These two countries possess various conditions which have in
the past provided vast opportunities for drugs production and, in particular,
heroin refining. These conditions are discussed below.

Heroin

Until quite recently, little commercial heroin production took place outside
South East and South West Asia.5 Now, in addition to an increase in production
in these regions, new sources have emerged. This section identifies the factors
which have traditionally corresponded with opium production and examines
whether the same conditions exist in new production areas.
In Burma, illicit opium cultivation and heroin refining is associated with
the independence movements of a number of ethnic minority groups which
depend upon the lucrative drug trade to fund armed campaigns against the
country’s military government, the State Law and Order Restoration Council
(SLORC). Economic insecurity is the principal motivation for large scale
opium cultivation by the peoples living in areas controlled by the insurgent
movements, which are located mainly in the north of the country.
Significant quantities of opium poppies were not cultivated in Afghanistan
before the war with Russia.6 The ensuing chaos after Russian withdrawal led
to a rapid rise in poppy cultivation, motivated by the country’s economic crisis
and also, possibly, by the return of unemployed refugees to the region.7 As a
cash crop, poppies are exceptional value, providing seven times the economic
return of wheat grown in the same area. There have also been reports of local
rebel commanders lending their support to the poppy industry.8
Refining of Afghan raw opium into heroin along the Pakistan border devel-
oped for a number of reasons: Pakistan is close to Indian sources of the
necessary precursor chemicals; tribal areas on the border have not been well
controlled by the central Pakistan Government (although this situation appears
to be changing, which is starting to push refining activities further north); and
alternative locations have been disrupted (e.g. stricter narcotics law enforce-
124 SHONA MORRISON

ment arose in Iran after the Khomeini revolution, and Afghanistan is unsafe
due to the on-going war there.)9
The Central Asian Republics are playing an increasing role in the heroin
industry, in terms of both poppy cultivation and heroin refining. Since the
end of the Cold War and the break-up of the Soviet Union, deteriorating
economic conditions, weak law enforcement, and political conflict has led to
an increase in opium poppy cultivation.10 “The possibility that the region’s
economies could come to depend largely on the production and export of nar-
cotic substances seems a very real prospect.”11 The Central Asian Republics
may also become a major refining region for Afghan heroin due, in part, to
the strengthening of drug legislation in tribal areas of Pakistan where refining
has traditionally taken place (as mentioned above).12
Fragile domestic political relations and rural poverty are also at the heart of
China’s expanding opium poppy industry. In the past decade, China’s sporadic
opium poppy cultivation has spread and crops have now been reported in 17
of the country’s 30 provinces.13 Like other parts of Asia, these developments
seem to have emerged in response to economic imperatives. In addition,
China’s government in Beijing generally prefers not to provoke confrontation
with the ethnic minorities that inhabit the vast but strategically significant
regions along the periphery of the country.14
The quantity of South American heroin seized in the United States has
almost doubled every year since 1993 and it now accounts for 62 per cent
of the net weight of heroin profiled by the US Drug Enforcement Agency.15
This phenomenal increase has been described as a shrewd marketing decision
by Colombian drug traffickers who have capitalised upon the greater profits
derived from heroin trafficking. The knowledge and experience gained from
two decades of cocaine trafficking has undoubtedly assisted the traffickers in
capturing so quickly such a large share of the heroin market in the United
States. However, the extent to which these advantages will allow Colombian
traffickers to capture a significant share of other overseas markets is unclear.

Cocaine

The jungles of Peru, where most of the world’s coca crops are grown, are
also characterised by insurgency. As the US market for cocaine began to
expand in the late 1970s, entrepreneurial Colombian traffickers began to
commission Peruvian farmers to produce a surplus from their traditional coca
crops.16 Since around the mid-1980s, however, it has often been claimed that
the insurgent movement, Sendero Luminoso (Shining Path), has controlled
Peru’s main coca growing region, although, the exact nature of the relationship
between Sendero and the cocaine industry is still not clear.17 On balance, it is
probable that an unholy alliance exists between Sendero and the traffickers.
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 125
In attempting to be seen as the de facto government of the region, Sendero
must look after the interests of the farmers, and it is in the economic interests
of the farmers to sell coca to Colombian drug groups.

Synthetic drugs

The demand for illicit synthetic substances (e.g. amphetamine, methylam-

phetamine, ‘ecstacy’)18 is now second only to cannabis in most parts of
the world, including Europe, Australia and parts of Asia. Correspondingly,
increases in the rates of production of these drugs have surpassed the growth
rates for heroin and cocaine production.19 A number of factors must have
assisted the phenomenal spread of synthetic drugs production.
Production may have spread, in part, because of ambiguous legislation.
Even today, legislation covering synthetic substances is reactive, involving
constant up-dating of the list of banned substances in response to the discovery
of new products by law enforcement.20 Also, a number of conditions have
reduced the entry barriers for synthetic drugs production which will have
facilitated the industry’s spread to new locations. New technology and the
spread of chemical industries have simplified the manufacture of synthetic
substances, eased their chemical modification and increased access to a variety
of starting materials. Also, of course, the production of synthetic substances
is not dependent upon geographical or climatic conditions. Yields also tend
to be higher for synthetics than for drugs of natural origin, so, even the
manufacture of small quantities of synthetics can be a lucrative business.21
And, although these processes produce a wide variety of end-products, from
the perspectives of the users, they are highly interchangeable.22
Despite the spread of sources of these drugs, it is important to note that
supply is not always provided by a local source. Indeed, some countries
import most of the synthetic drugs consumed there (e.g. South Korea) and
most countries import at least some amphetamines or amphetamine analogues
(e.g. many countries in Europe import synthetic drugs which have been man-
ufactured in the Netherlands). This suggests that, although the industry is
quite diffuse, some areas must be more suited to synthetic drugs production
than others. What conditions may attract production to some areas?
Licit pharmaceutical industries located in developed countries initially sup-
plied the market for these drugs. By setting up alongside the licit industry,
producers of synthetic drugs lowered their production costs through easy
access to knowledge, equipment and chemicals (before the introduction of
stricter controls) and had a ready-made market for the drugs. Similarly, coun-
tries with large chemical manufacturing industries today may manifest greater
concentrations of illicit synthetic production. This may help to explain the
pattern of increasing synthetic drugs production in many of the newly indus-
126 SHONA MORRISON

trialising countries in the Asia-Pacific region and in Central Asia.23 In the

latter, it is believed that even university research institutes and government
factory facilities have become involved in illicit synthetic drugs manufacture
since the collapse of the old industrial order.24

A model of illicit drug sources

Sources of illicit drugs evolve in response to a changing array of global and

local pressures and incentives. Factors such as economic insecurity and the
comparatively large financial gains made possible by the illegality of drugs
have contributed to a changing landscape of drug producing regions.
To assist in the task of identifying which parts of the world may be at risk of
becoming the “narco-states” of the 21st century, a framework grounded in the
driving forces of illicit drugs production is required. This framework should
differentiate between different drug industries and the pattern of drug sources
which is evident for each type. It should also provide a set of measurable
criteria against which to compare different countries and to determine their
levels of risk or vulnerability to developing into major drug sources. A “major
drug source” may be defined as one that consistently contributes significant
quantities of illicit drugs to regional and international narcotics trade.25
Drug sources exist along a dimension from “concentrated” to “diffuse”.
Those that are “concentrated” generate the bulk of global drug supplies from
a small number of sources (which are often, but not always, geographical-
ly co-located). Latin America’s cocaine industry is one example. “Diffuse”
industries are characterised by a wide range of sources which supply mainly
local or regional markets. Cannabis cultivation, for instance, is highly dis-
persed and cannabis is grown in almost every country of the world. The
different characteristics associated with concentrated and diffuse drug indus-
tries create different types of problems for law enforcement which require
different sorts of solutions. Figure 1 shows the characteristics of “concentrat-
ed” and “diffuse” drug industries and locates each of the main illicit drugs
along this continuum.
The model of illicit drug sources provided in Figure 1 shows that certain
contextual conditions may give rise to vulnerability to illicit drugs production.
Some areas attract organic drug industries (with the exception of herbal
cannabis which is discussed separately below), due to the dynamics created
by rural economic insecurity and the disruption caused by active insurgent
movements or corruption. Under these circumstances, law enforcement is
weakened or non-existent leaving whole regions open to the cultivation of
illicit crops by farmers motivated by poverty or coerced by “narco-insurgents”.
For the farmers, these crops provide a higher income than other agricultural
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 127

CONCENTRATED DIFFUSE
SOURCES SOURCES

Cannabis
Synthetics
Heroin
Hashish and oil
Cocaine

• weak law enforcement caused by either • accessible raw materials (contributing

corruption or insurgency (either of which
may help make drug issues a low national
priority)
• economic insecurity, especially in rural
areas
• isolated rural areas.
to low overhead costs and high yields)
• economic insecurity
• end-products perceived to be ‘safe’
(contributing to high level of demand)
• few specialist skills required
• non-labour intensive

Figure 1. The characteristics of concentrated and diffuse sources.

commodities and the drug itself is sometimes used for traditional therapeutic
or religious purposes. For the insurgent groups who buy the crops from the
farmers or extract tax from the trafficking groups who do so, a lucrative
source of funding arises to further their campaigns. And, by looking after
the financial interests of the local people, insurgent groups may be rewarded
with a degree of loyalty, thus furthering their principal goal of increasing
legitimacy. So, relationships between the insurgents, the traffickers and the
local people are mutually beneficial. Rural isolation assists these dynamics
by reducing opportunities for surveillance and intervention.
The dynamics of cannabis and synthetic drugs production are determined
not so much by the political economy of the environment in which they exist,
but by the nature of the manufacturing processes and the products themselves.
This has prompted industries of a more flexible and diffuse nature to evolve.
Relatively simple means of production and strong demand combine to
make these industries more or less dependent upon the availability of willing
suppliers and raw materials. There is clearly no shortage of the former, partic-
ularly in economically depressed areas. In addition, the precursors required
for cannabis cultivation (mainly seeds, light and water) can, it seems, be
obtained without too much difficulty. The portability of cannabis seeds may
128 SHONA MORRISON

have contributed to the range of countries in which that drug is grown (i.e.
practically every country in the world).
On the other hand, the precursor chemicals required for the manufacture of
significant quantities of synthetic drugs should be less accessible now than
they were before developed countries, and many newly industrialising nations,
began strengthening legislation concerning the regulation of these chemicals.
Yet, illicit synthetic substances continue to flood international drugs markets
from countries as diverse as North America, the Netherlands, Mexico, and
more recently from parts of Eastern Europe, the Central Asian Republics
and East Asia. It has been suggested that the introduction of a clandestine
synthetic drugs industry may have benefited from proximity to legitimate
chemical industries. Precursor legislation, while it has made chemicals less
accessible overall, will not have reduced this competitive advantage: apart
from the reduction in costs (and risks) to drug producers with local access to
chemicals, there are clearly benefits to be gained (and risks to be avoided)
by the recipients in major consuming countries who choose to import the
finished products rather than the more bulky, unrefined precursor chemicals.
The model of the characteristics of drug sources (Figure 1) will assist us
in the task of identifying potential new sources of illicit drugs, which is the
purpose of the analysis described in the next two sections. This information
may subsequently be put to use as part of a narcotics early warning system of
emerging problems in those regions. Examples of the sorts of developments
which could trigger new drugs production are discussed in the following
section.

Method

A country-by-country analysis of the factors which were identified by the

model of drug sources was conducted to determine; i) which countries are
at risk of becoming major sources of refined organic drugs (such as heroin
or cocaine), and ii) which countries could develop significant synthetic drug
industries. The analysis does not address the ‘potential’ sources for cannabis
because so few countries remain untouched by this industry already.
The criteria used in the analysis are contained in Figure 2 and data sources
are provided below.
 Corruption. The Internet Corruption Ranking 1996, using a ten-point
scale, assesses the level of government corruption in countries throughout
the world.26 For the current study, these scores were divided into “low”,
“medium” and “high” categories.
 Armed conflict/insurgency. Jongman (1995) described world conflicts
ranging from serious disputes, through low intensity conflict to war.27
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 129
These ratings were placed on a four-point scale with a range from “no
dispute”, “low” (serious dispute), “medium” (low intensity conflict) and
“high” (war) conflict.
 As an indicator of rural economic insecurity, data on each country’s
dependence on agricultural employment were used. The World Fact-
book 1995, published by the USA’s Central Intelligence Agency, was the
source of these data.28 A “low” rating has been allocated when less that
30 per cent of the population is employed in agriculture; when between 31
and 50 per cent of the population is employed in agriculture, a “medium”
rating has been applied, and; over 51 per cent led to a “high” rating.
 No clear criteria exist with which to measure whether a country has
sufficient isolated rural areas in which to cultivate illicit crops. This is
because extremely large areas are not necessary for the cultivation of
significant quantities of organic drugs. The Lebanon, for example, is
smaller than Belgium yet is a significant producer of cannabis. Thus,
even quite small countries such as Burundi and Haiti are presumed to be
of sufficient geographical size to support significant drug cultivation. In
the end, just seven countries were judged to lack sufficient rural territory;
these are Singapore, Hong Kong, Macau, Jordan, Israel, Guinea and
Togo.
 To measure the economic security of each country, data were collected
on levels of unemployment and on aid status (i.e. whether countries
receive financial assistance from overseas governments). Both sets of
data were obtained from the CIA World Factbook 1995. Unemployment
levels have been rated “low” (if less than 10 per cent of the working-
age population are not in employment) or ‘high’ (if unemployment,
or underemployment, levels are 10 per cent or above). Countries have
also been divided into those which do, and those which do not, receive
overseas aid.
 The CIA World Factbook 1995 also provides information on the nature of
the industries that exist in each country. This allowed data to be collected
on the global locations of chemical industries.29
It has already been established that the production of synthetic drugs requires
little in the way of specialist skills or labour, it is not dependent upon climate,
and global demand for these drugs continues to grow. As these factors are
non-variable from country to country, there was no need to include them in
the analysis.
As a test of the observed validity of the methodology, known drug produc-
ing countries (e.g. Afghanistan, Peru, Burma) were included in the analysis.
It was found that, with very few exceptions, existing illicit drug producers
were identified as ‘potential’ sources. A few countries in which significant
130 SHONA MORRISON

Potential New Producers Potential New Producers

(organic drugs) (synthetic drugs)

Essential • Armed conflict/insurgency = medium to high • Chemical industries = yes

AND/OR weak government/corruption =
Criteria medium to high
(must have • Dependence on agricultural commodities =
all) medium to high
• Isolated rural regions = yes

Secondary • Unemployment = high • unemployment = high

Criteria • aid recipient = yes • aid recipient = yes
(must have one)

Figure 2. Criteria used to select countries at risk of becoming significant new drug sources.

illicit production of synthetic drugs takes place (e.g. the United States, the
Netherlands, and the United Kingdom) were not identified by the analysis
suggesting that the test for potential sources of synthetic drugs is less valid
than that for organic drug sources. The results may have been improved if
a comparable measure of the strength/weakness of each country’s precursor
legislation had been included. Research on the relative capacities of different
precursor legislation would be required to develop such a variable. Compar-
ative research on the legislative options for precursor regulation would also
inform government and law enforcement policy regarding preventive drug
strategies.
Construct validity is the extent to which the measurement strategy is theo-
retically sound and/or logical, and derived categories, conclusions and inter-
pretations are congruent with previous theories or findings. Unfortunately,
there has been little prior research or theory to guide the design of the data
collection for this study. However, discussion of the methodology and results
with peers has led to the conclusion that there is a reasonable degree of
consensus with the methodology and findings. It should also be noted that
the purpose of this analysis was not to predict which countries will become
significant future sources of illicit drugs, but to identify those with prevailing
conditions that render them at risk of developing these problems. Thus, a
number of false positives might be expected.

Results

Table 1 lists those regions at risk of becoming significant sources of organic

drugs, while Table 2 shows potential synthetic drug sources.
Countries identified in the analysis, which are already known to produce
significant quantities of organic drugs, have been excluded from Table 1.
This includes Burma, Thailand, Iran, Afghanistan, India, Pakistan, Turkey,
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 131
Table 1. Regions at risk of becoming sources of highly-refined organic drugs.

Asia and Pacific Africa and Middle East The Americas Europe &
Central Asia

 E Asia (China, Cambodia,  South Africa  Central America  Greece

Vietnam, Indonesia,  Middle East (Ecuador,
Philippines, PNG) (Yemen, Iraq) El Salvador,
 Indian Sub-Continent  Egypt Guatemala,
(Bangladesh, Sri Lanka)  West Coast (Ghana, Nicaragua, Haiti)
 Central Asia Liberia, Cameroon,  Brazil
(Uzbekistan, Tajikistan) Congo, Nigeria,
Angola, Sierra Leone)
 Central Africa
(Chad, Sudan, Ethiopia,
Kenya, Uganda, Zaire,
Rwanda, Burundi, Mali)

Table 2. Regions at risk of becoming sources of synthetic drugs.

Asia and Pacific Africa and Middle East The Americas Europe

 E Asia  South Africa  Central America  Eastern Europe

(China, Vietnam,  Middle East El Salvador, Guatemala (Bulgaria, Poland
Burma Taiwan (Iraq, Israel, Lebanon) Nicaragua, Mexico) Hungary)
S Korea, Indonesia  North and Central Africa  S America (Venezuela  Western Europe
Philippines) (Egypt, Nigeria Argentina, Ecuador (Denmark, Croatia
 Indian Sub-Continent Niger, Zambia Colombia, Brazil) France, Belgium,
(Bangladesh, India) Zimbabwe, Ethiopia Finland, Spain
 Central Asia Mozambique) Greece, Ireland
(Tajikistan, Azerbaijan Italy, Portugal)
Kazakhstan, Kyrgystan,
Georgia, Russia)

Peru, Bolivia and Colombia. No countries have been excluded from Table 2
because the synthetic drugs industry is less firmly established than those
supplying organic substances and the nature of the industry provides greater
opportunities for mobility.
It can be seen from Table 1 that clusters of neighbouring countries display
conditions which could render significant illicit drug cultivation feasible.
Africa in particular has many nations with the appropriate conditions for drug
cultivation, yet, other than the cultivation of cannabis, this continent is not
known for supplying organic drugs.30 There may be a number of reasons for
this, not least of which may be unsuitable growing conditions. However, it is
132 SHONA MORRISON

possible to hypothesise ways in which this situation may change and this will
be discussed below.
Table 2 shows that few parts of the world are immune to potential synthetic
drugs production. The countries most worthy of note are those which were
selected by both analyses and have the potential, therefore, to become involved
in the production of both organic and synthetic drugs. Some of these regions
may be already skilled in drug refining, thus, are better placed to diversify
into new drug types. For instance, the competitive advantages gained through
large-scale distribution of cocaine and heroin may assist some countries (such
as Colombia and Burma, for example) to diversify into the synthetic drugs
industry. Brazil also warrants careful monitoring. Like Colombia, it produces
all of the raw materials necessary to become self-sufficient in both organic
and synthetic drugs production, and it is strategically positioned next to all
three major Latin American players in the cocaine industry.31
The potential for Central and South America to play a future role in the
chemical synthesis of illicit drugs is worthy of attention because apart from
Mexico, none of the South American countries have so far been recognised as
major suppliers of synthetic drugs. If this scenario developed, the implications
would be especially significant for the North American market for illicit drugs.
In Australia, overseas supplies have not so far been found to make a sig-
nificant contribution to the domestic market for synthetic drugs. However, it
is possible that this situation could change because evidence is accumulating
of diversification into synthetic drugs by established Golden Triangle heroin
producers.32
Since the Golden Triangle (i.e. Burma, Thailand and Laos) already supplies
the bulk of heroin consumed in the Eastern hemisphere, the infrastructure and
networks required to penetrate Asian and Australian drugs markets is already
in place which would lower production and transaction costs considerably.
For Australia, this scenario is especially likely if purity levels of ‘home-
produced’ drugs remains low and precursor chemicals become increasingly
difficult to obtain.33

Significant threats

The analysis reported above should assist policy makers and law enforcement
agencies to identify regions at risk of becoming major future suppliers to the
international trade in illicit drugs. Yet, the countries discussed must currently
possess some barriers to entry as significant illicit drug production does not
(yet) take place in most of the areas listed in Tables 1 and 2. By identifying
what the barriers might be, and then monitoring them, the international law
enforcement community would receive early warning of changes in the status
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 133
of ‘at risk’ countries. The purpose of this section is to provide a brief outline
of some developments that could trigger drug production in some parts of the
world. However, further research would be required to detail the mechanisms
through which this would occur and to develop indicators that would inform
the early warning system.

Economic transition

Some of the countries identified as potential producers of organic drugs are

still considered to be extremely economically underdeveloped (e.g. countries
in Africa and the Indian Sub-Continent). The conditions that have prevented
development in these regions are still the subject of debate. However, it may
be that the characteristics which have prevented them from participating in
the legitimate economy have deterred their entry into the black economy as
well.34 Thus economic development in these regions may generate unintended
consequences which could lead to these countries entering into illicit drugs
production.

Insufficient supply

New drugs sources could develop in response to drug supply shortages

Although it is not clear to what extent illicit drug supply is stimulated by
market forces, increased levels of demand could instigate this pattern. Supply
shortages could occur as a result of other forces also, such as pressures created
by law enforcement in traditional producing areas. If resolution of the polit-
ical turmoil in Burma, Afghanistan or Colombia was achieved, for instance
(and if this led to more effective drugs law enforcement), it is feasible that
drug producers may look to establish new growing regions in other parts of
South East Asia, in the Central Asian Republics (which are already gaining
a reputation for their role in the drugs trade), or in other countries in South
America.

Technological development

As applies in the case of licit industries, the spread of illicit drugs production
to new regions is assisted by the transfer of expertise and the development of
new technology which makes the process easier, cheaper and more suited to
local conditions. Illicit drug production has become more flexible due to the
invention of more efficient farming technology (e.g. irrigation) and growing
methods (e.g. hothouse cultivation and hydroponics), the development of new
crop strains (providing higher yield, resistance to pestilence, etc.), fast and
accessible means of knowledge transfer (e.g. the Internet) and the industri-
alising of whole continents. The technological developments may not bring
134 SHONA MORRISON

opium and coca cultivation into our urban neighbourhoods (as we have seen
with the advent of hydroponic cultivation of cannabis), but they could make
production more efficient and more attractive to a wider variety of people in
more regions of the world.
Synthetic drug sources could also become less concentrated due to sim-
pler manufacturing processes and by increasing acceptance of the substances
themselves. Although the factors that determine popular acceptance or rejec-
tion are complex and largely undetermined, the simplification of chemical
refining techniques is a reality that could re-shape production of illicit (and
licit) drugs in the future.
Continued development in all these spheres will reduce entry barriers and
increase the attraction of the illicit drugs industry.

Product diversification by existing suppliers

Trends such as economic development, changing law enforcement pressures,

technological development and improved communications systems, not only
attract new suppliers of illicit drugs, but may also increase ease of diversi-
fication by existing suppliers. Existing suppliers could have a competitive
advantage when diversifying into new product ranges which is created by
their access to refining equipment, to established sources of precursor chem-
icals and to existing lines of distribution. They may also have transferable
refining skills.
It is also possible that illicit suppliers of other types of commodities (besides
drugs) could diversify into drugs production. In Cambodia, for instance, the
Khmer Rouge have depended upon funds from illicit logging and gem mining
to fund their war against the Cambodian Government. Recently, however, a
large section of the Khmer Rouge’s soldiers defected and are negotiating
cease fire agreements with the government. The breakaway armies control
most of the logging and mining grounds in Cambodia’s North West,35 and
without access to this lucrative territory, the Khmer Rouge will lose cross-
border timber sales worth over $10 million per month.36 Loss of this revenue
may provide a strong incentive to the remaining Cambodian insurgents to
begin trade in other types of illicit products.

Conclusion

Whether source country policies will be an effective mechanism through

which to minimise the harms associated with the supply of illicit drugs will
depend upon their success in reducing the motivations and opportunities
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 135
which perpetuate drugs production. The purpose of this analysis was to iden-
tify countries showing adverse symptoms of economic and political changes
(opportunities and motivations) which may increase their risk of developing
into significant drug producers in the future. Some current global develop-
ments were discussed which may provide the impetus for, or remove barriers
to, drug production. By monitoring these developments, governments and the
international law enforcement community would receive early warning of
potential threats constituted by changes in the status of “at risk” countries.
The need for fore-warning of changing patterns of drugs production is evi-
dent from the recent rapid increase in heroin production in Colombia and the
rate at which South American traffickers were able to capture such a large
share of the United States’ heroin market (at least, according to drug seizures
figures). With the advantage of hindsight, this should not have been an entire-
ly unexpected scenario: the falling popularity of crack cocaine and reported
saturation of the American and European markets for cocaine hydrochloride,
coupled with the persistence of Latin American drug organisations (even
though individuals have been arrested, the organisations seem to have per-
sisted) and enduring networks throughout North America, made it possible,
at best, or probable, at worst, that diversification would occur. Moreover, the
Colombians’ vast experience in the drugs trade and the fact that wholesale
heroin sales provide greater returns than cocaine would have made heroin
production an attractive option. The main barrier to entering the heroin trade
for Colombian drug suppliers might have been lack of skills in the cultivation
of opium poppies and production of heroin. However, the speed with which
they managed to overcome this problem suggests that obtaining the knowl-
edge and relevant skills for the production of good quality drugs may be
much easier than analysts of the trade generally believe. This has significant
implications with regards to the potential for further diversification.
While the threat of a South American source for heroin has already become
a reality in North America, it is still worth considering what the potential
implications of this trend are for other parts of the world. For instance, will
European or even Asian law enforcement agencies begin to make significant
seizures of South American heroin? In Europe, where the heroin market is
supplied mainly by drugs sourced from Afghanistan, this scenario is certainly
possible. Latin American drug supply networks already exist throughout
Europe due to the cocaine market there. If the European cocaine market really
is saturated, heroin supply may become a viable option for those traffickers
and distributors. Furthermore, opportunities to enter the heroin market could
increase if the political situation in Afghanistan stabilises and international
pressure mounts for the Taliban to abide by their promises to rid that country
of its illicit poppy crops.
136 SHONA MORRISON

In the Eastern Hemisphere, the bulk of heroin consumed is supplied by

Chinese organised crime groups and this situation is not likely to change in
the short term. Unlike Europe, Asia and Australasia does not have a strong
market for cocaine and the competitive advantage held by the Chinese in the
heroin market would be hard to overcome. Of course, the market for heroin
in the newly industrialising countries of Asia is expanding rapidly and China,
with its enormous population, has the potential to become the largest heroin
market in the world. Thus, in the longer term (10 to 20 years), it is uncertain
whether the Golden Triangle, South East Asia’s main poppy growing region,
could support Asia’s future heroin market, or whether the Chinese will retain
their traditional advantage in the vastly competitive market which is likely to
be created in the East. How the scenario develops will depend upon a number
of factors, including the rate of growth of Asia’s heroin market, the rate at
which poppy production can increase in the Golden Triangle and surrounding
regions and, of course, political and economic dynamics which are conducive
to the continuation and expansion of Latin America’s heroin industry.
Another point to ponder is the success and future potential of the synthet-
ic drugs industry, a relative newcomer on the global stage for illicit drugs.
This market has revolutionised the global drugs trade. The substitution poten-
tial of the substances and the nature of the manufacturing processes provide
enormous scope for diversification and expansion. Simple manufacture of
amphetamine analogues make it possible for suppliers to elude drugs legis-
lation and to adapt to user preferences. These characteristics have created an
illicit industry which is highly flexible and, possibly, with fewer of the risks
associated with organic drugs production.
Regulation of the precursor chemicals which are used in the production of
illicit synthetic drugs has become an important preventive strategy in most
countries’ drug policies. However, the strength of the legislation varies from
country to country and, as this analysis suggests, drugs production is likely to
be attracted to those areas where controls are (perceived to be) weakest. The
global legislative context for precursor chemicals requires further analysis
to spotlight those regions which are at risk of becoming major suppliers of
synthetic drugs. This information could be used to inform policy. While it
is not easy to develop proactive strategies which would prevent the further
spread of illicit drugs production, it may be argued that it is even harder to
address this situation once it has emerged. To be effective, source country
policies which operate at the level of motivation and opportunity reduction
are required.
 THE DYNAMICS OF ILLICIT DRUGS PRODUCTION 137
Notes

1. Mark L. Moore, ‘Limiting supplies of drugs to illicit markets’, Journal of Drug Issues,
1979 (9:3), 291–308; M. Falco, "US drug policy: addicted to failure", Foreign Policy, 1996
(102), 120–133.
2. Coca, from which cocaine is manufactured, does thrive in clay soils while opium poppies,
the source of heroin, benefits from soil with a high lime content.
3. (Washington D.C: US Department of State, 1996); Interpol, Weekly Intelligence Message,
1995 (26/95).
4. "Morocco’s drugs", Foreign Report, 1996 (16/96).
5. Alfred W. McCoy, Drug Traffic: Narcotics and Organized Crime in Australia, (New South
Wales: Harper & Row, 1980).
6. Interpol, op cit.
7. Interpol, ibid.
8. Sankar Sen, "Heroin trafficking in the Golden Crescent", The Police Journal, 1992 (July),
251–256.
9. Sen, ibid., p 25.
10. Rensselaer W. Lee III, "Drugs in Communist and former Communist states", Transnational
Organized Crime, 1995 (1:2), 193–205.
11. Lee, ibid., p 200.
12. Interpol, 1995, op cit.
13. Lee, op cit., p 193.
14. Lee, ibid., p 197.
15. US Drug Enforcement Agency (DEA), “Colombian heroin a major threat”, DEA Press
Release, 1995 (21 June); DEA, “The 1995 heroin signature program”, Intelligence Bulletin,
1996 (August).
16. J.T. Fishel, “Coca, cocaine, sicarios and senderistas” in G.H. Turbiville (ed) Global Dimen-
sions of High Intensity Crime and Low Intensity Conflict (Chicago: Office of International
Criminal Justice; University of Illinios, 1995), 184–203.
17. Fishel, ibid., pp 194–195.
18. Ecstacy is the common name for 3,4-Methlenedioxymethamphetamine (MDMA).
19. United Nations Commission on Narcotic Drugs, Stimulants and the use of their precursors
in the illicit manufacture of and trafficking in drugs, (Vienna: Report of the Secretariat,
Commission on Narcotic Drugs, thirty-ninth session, 1996).
20. UN Commission on Narcotic Drugs, op cit., p 6.
21. UN Commission on Narcotic Drugs, op cit., p 15.
22. UN Commission on Narcotic Drugs, op cit., p 19.
23. Precursor legislation is also less well developed in these areas than in Western societies
where, until recently, most of the demand for synthetic drugs was located.
24. Lee, op cit., p 201.
25. The International Narcotics Control Strategy Report, 1996, p 27, states that ‘a major illicit
drug producing country is one in which: (a) 1,000 hectares or more of illicit opium poppy
are cultivated or harvested during a year; (b) 1,000 hectares or more or illicit coca are
cultivated or harvested during a year; or (c) 5,000 hectares or more of illicit cannabis are
cultivated or harvested during a year’.
26. Transparency International and Gottingen University, Internet Corruption Ranking 1996
(World Wide Web, 1996).
27. A.J. Jongman, “Contemporary conflicts: a global survey of high and lower intensity
conflicts and serious disputes”, PIOOM Newsletter, 1995 (7:1), 14–21.
28. Central Intelligence Agency (CIA), World Factbook (World Wide Web, 1995).
29. CIA, ibid.
30. S. Baynham, “Africa: drugs set to become Africa’s new invaders”, Jane’s Intelligence
Review, (World Wide Web: Jane’s Information Group Ltd, 1996, 9/96),.
138 SHONA MORRISON

31. Maria Velez de Berliner & Kristin Lado, “Brazil: the emerging drug superpower”, Transna-
tional Organized Crime, 1995 (1:2), 239–260.
32. Interpol, 1996, Weekly Intelligence Message, 1996 (27/96); Bertil Linter, “The noose
tightens”, Far Eastern Economic Review, 1995 (19 October).
33. Purity levels for retail sale drugs remain low in Australia at between 3 and 5 percent
(Australian Bureau of Criminal Intelligence (ABCI), 1996, Australian Illicit Drug Report,
(Canberra: ABCI, 1996). Effective precursor legislation may be the cause of this situation.
34. For an assessment of some of the conditions that have prevented Africa from obtaining
successful economic growth, see W. Easterly & R. Levine, Africa’s Growth Tragedy: A
Retrospective, 1960–89, Policy Research Working Paper no 1503, (Washington D.C: The
World Bank, Policy Research Department, 1995).
35. “Cambodia: Khmer Rouge rebels pose dilemma”, The Guardian, 1996 (2 September).
36. “Cambodia’s wood-fired war”, The Economist, 1995 (17 June).