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PP RUEHDBU RUEHKW
DE RUEHUNV #0050/01 0430755
ZNR UUUUU ZZH
P 120755Z FEB 10
FM USMISSION UNVIE VIENNA
TO RUEHC/SECSTATE WASHDC PRIORITY 0574
INFO RUEHKO/AMEMBASSY TOKYO 0824
RUCNNAR/VIENNA NARCOTICS COLLECTIVE

UNCLAS SECTION 01 OF 03 UNVIE VIENNA 000050 
 
KABUL FOR ANDREW QUINN 
STATE FOR S/SRAP MATTHEW STIGLITZ 
STATE FOR INL/AP MICHAEL OVERBY 
 
SIPDIS 
 
 
E.O. 12958: N/A 
TAGS: SNAR AF UN JP
SUBJECT: UNODC: Afghan Opium Stabilizing: What is International 
Community Going to Do About It? 
 
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SUMMARY 
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¶1. Summary. Fresh off his trip to the January 28 London Conference, 
and with the UN Office of Drugs and Crime (UNODC) "Winter 
Afghanistan Opium Assessment Survey" in hand, Executive Director 
Costa predicted that after two years of significant decline (36 
percent overall), opium cultivation in Afghanistan will stabilize in 
¶2010. Along with this "positive development," Costa predicted that 
lower agricultural yields can be expected in the country due to the 
current drought. As a result, Costa believes that up to twenty-five 
provinces could be "poppy free" by summer of 2010, and called upon 
the international community to direct its development assistance to 
those "swing provinces" where poppy cultivation is marginal but 
vulnerable to increases.  More worrisome, he argued, is the 
simultaneous decline in agricultural commodity prices, which could 
reduce the incentives for farmers to turn away from poppy.  Costa's 
briefing underscores the importance of integrated UNODC benchmarks 
to assess counter narcotics progress in Afghanistan as well as the 
need for an integrated UNODC strategy which includes alternative 
development assistance.  UNODC is already working on both; when the 
strategic country program is ready for consideration, as early as 
the end of next month, we should be ready to seriously consider 
funding support in order to maximize some of UNODC's comparative 
advantages in Afghanistan.  End Summary. 
 
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The Good News 
------------- 
 
¶2.  On February 3 and 4, Costa briefed major donor and Central Asian 
regional ambassadors on his preliminary conclusions based on the 
annual "Winter Afghanistan Opium Result Survey." (Note. This annual 
assessment is based on a nation-wide survey of villagers and farmers 
to better understand their current and future intentions with regard 
to cultivating opium poppy. Costa and his statistical team are 
increasingly confident that the winter assessment, while only 
indicative, is a strong predictor of the country's future 
cultivation and production results.  End note.) 
 
¶3.  Costa predicted an opium crop consistent with last year's 
numbers. Such an outcome would end two years of substantial 
declines, but also indicates that "poppy free" provinces (i.e. those 
with less than 100 hectares of cultivation) are increasingly stable 
and less likely to return to large numbers. Costa therefore asked 
delegations to target their development assistance to those 
provinces where cultivation is currently minimal, but which could be 
trending in the wrong direction,specifically, Baghlan, Frayab and 
Sari Pul, but also Kunar, Nanharhar, Kabul, Laghman and Badakhshan. 
If development assistance and community-inspired measures like 
shura-driven campaigns and governor-led eradication are effectively 
targeted and implemented, Costa said up to twenty-five provinces 
could achieve "poppy free" status; and if so, would prove Costa's 
current thesis that "Afghanistan doesn't have an opium poppy 
problem. A few districts in a few provinces have an opium poppy 
problem." 
 
¶4.  Along with a stable and increasingly localized cultivation 
problem, Costa also predicted an overall decrease in the yield of 
opium due to ongoing drought conditions and lower than average 
snowfall. With these conditions unfortunately hitting the licit 
agricultural sector as well, Costa nevertheless believes that this 
is a promising omen for the counter-narcotics situation in 
Afghanistan. 
 
¶5.  Finally, Costa noted that opium prices, even after calculating 
for inflation, are at Taliban-era levels, currently standing at US 
$48/kilo for fresh opium. Costa attributed the crash of opium prices 
to increasing international pressure on drug traffickers and 
interdiction, and a consistent cultivation decrease over the past 
few years. Costa also noted the current opium glut (resulting from 
the boom years of 2004-2007) has flooded the market and has helped 
to lower prices as well. 
 
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But the Bad News, Too 
--------------------- 
 
¶6.  On the other hand, Costa warned that licit agricultural prices 
are falling at a much faster rate than opium, which could induce 
farmers to switch back to opium poppy. Costa pointed to wheat prices 
(43 percent decline since 2009) and maize (38 percent decline) as 
examples of this worrying trend. In comparison, fresh opium prices 
have only decreased 13 percent and dry opium just 6 percent. Costa 
attributed some of this to the already "rock-bottom" price of opium, 
 
UNVIE VIEN 00000050  002 OF 003 
 
 
but encouraged member states to increasingly focus their support 
towards licit agricultural activities and markets.  Indeed, Costa 
noted, opinion surveys in the south and west showed that the number 
two and three reasons for not cultivating opium poppy was its low 
yield and sale price (Note:  That it was banned by the government 
was the number one reason cited.  End Note.)  Such opinion results, 
Costa asserted, should reinforce international efforts to take 
advantage of the window of opportunity offered by the current 
relatively low opium prices and increase alternative development 
assistance as a means to more permanently incentivize farmers to 
move away from poppy cultivation.  Separately, UNODC officials noted 
their eagerness to work with other partners, including bilateral 
assistance agencies and other UN bodies (for  example the World Food 
Program and UNIDO) to promote alternative development.  (Note. 
UNODC is reinvigorating its own alternative livelihood program, 
potentially including such elements as pest management, canal clean 
up, improving produce hygiene, and organic pistachio cultivation. 
UNVIE will send the updated project proposal separately, as soon as 
it is ready.  End Note). 
 
¶7.  Costa stressed the strong correlation UNODC sees between 
"insecurity" and cultivation. The better the security situation, the 
less likely a village would plant opium poppy. Costa highlighted the 
promise that receiving some kind of agricultural assistance (for 
example, provision of seeds, fertilizer, irrigation) seems to have a 
positive effect on a farmer's decision to forego cultivating poppy. 
Indeed, the UNODC has incorporated in its currently small 
alternative livelihood program, the conditionality that no 
cultivation, trafficking, or migrant harvesting of opium is 
undertaken by recipients. 
 
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Measuring Success 
------------------------ 
 
¶8.  Expressing U.S. support for the excellent UNODC reports on the 
Afghanistan opium situation, DCM Pyatt queried Costa on how UNODC is 
measuring whether Afghan and international counter-narcotics efforts 
are succeeding. As in his separate briefing to Ambassadors the 
previous day, Costa acknowledged the need for integrated benchmarks 
and reported that UNODC was currently working on these benchmarks in 
cooperation with the Afghan Ministry of Counter-Narcotics.  He added 
that UNODC hoped to have something to share by early summer 2010 
(Note. U.S. has provided funding for this initiative. End note.) 
Costa referenced several possible benchmarks in addition to the 
current opium cultivation one: price trends, the tally-board of 
"poppy free" provinces, analyses of precursor chemical 
use/importation, corruption, cannabis cultivation, and Afghan drug 
addiction. Costa also opined that a proper understanding of the 
Afghanistan drugs problem would be better served by an analysis that 
focused on individual provinces and villages in addition to the 
general national results. 
 
-------------------------- 
Japan Offers UNODC US $7 
Million 
--------------------------- 
 
¶9. During the meeting, Japan DCM announced that his government, in 
recognition of the strategic threat posed by Afghan opium production 
and trafficking, is preparing to pledge USD $7 million to UNODC 
during its FY2010. Currently, USD $3.9 million is slated for UNODC's 
Afghanistan program projects and USD $3.1 million would be dedicated 
to a variety of country projects in neighboring countries including 
Iran. 
 
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Comment 
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¶10.  Costa clearly sees an Afghanistan at a crossroads and is in the 
process of positioning UNODC as a partner in an integrated 
Afghanistan counter narcotics strategy, including border control, 
anti-corruption measures, criminal justice capacity building, and 
demand reduction (Note.  The country program is slated to also 
contain a counter terrorism component.  End Note).  Now, UNODC is 
taking steps to mainstream these objectives in the wider 
reconstruction and development context, and is reinvigorating its 
alternative livelihood program, particularly focusing on western 
Afghanistan.  UNODC is already taking a regional approach in its 
Afghanistan programs, including through its Central Asian Regional 
Information and Coordination Center (CARICC), and the Triangular 
Initiative on border enforcement among Pakistan, Afghanistan and 
Iran.  With regard to alternative development, UNODC is taking steps 
to identify international partners to maximize efficiencies.  While 
UNODC's current estimated Afghanistan budget of US $89 million is 
 
UNVIE VIEN 00000050  003 OF 003 
 
 
tiny compared to our bilateral efforts, we believe UNODC is a 
valuable international partner and we should be ready to look 
closely at the integrated country strategic program when it is ready 
(we hope by the end of next month) in order pinpoint programs we can 
fund (for an amount that would actually be very small compared to 
our overall Afghanistan counter narcotics budget) and that, as an 
internationally-backed effort, would complement and reinforce our 
own national strategy.  END COMMENT. 
 
 
DAVIES