How does drug policy affect the illicit drugs market?

1. How does drug policy affect the illicit drugs market? Franz Trautmann Trimbos Institute www.trimbos.nl

2. Based on Trimbos/RAND study on global illicit drugs markets 1998-2007 (ed. Reuter and Trautmann) Covering: • Analysis of the operation of the global market for illicit drugs • Cocaine, heroin, marijuana, Amphetamine Type Stimulants (ATS) • Estimating seize of the market • Estimating economic costs of drug use • What has happened to the market 1998-2007 • What were the policies of the period • How did these policies affect the markets • Analysing unintended consequences of drug policy

3. Outline • Drug policy 1998-2007: • Demand reduction • Supply reduction • Drug problems 1998-2007: • Consumption • Supply • Unintended consequences • Policy analysis

4. General policy trends • Drug policy expenditures in many countries increased substantially • The biggest share of expenditures for supply reduction • Measures against production and trafficking intensified substantially • Demand and harm reduction measures intensified and (the latter) spread to more nations

5. Drug policy expenditures in four countries

6. Convergence of policies: demand side • Strong political support for prevention • Growing emphasis on proven effective programmes • Few demonstrated programs of even modest effectiveness • Many implemented programs ineffective • Increasing budgetary and political support for treatment • OST is spreading • Even to unlikely countries, e.g. China, Iran • In 26 of 27 EU Member States

7. Convergence of policies: demand side • Other Harm Reduction measures also spreading • Syringe Exchange Programs now in many countries • Even in U.S. though not with federal support • Reduced willingness to punish drug users • More decriminalization of drug use, mostly marijuana • Administrative sanctions for possession of small quantities for personal use • Few arrestees are incarcerated Emphasis on pushing arrested addicts into treatment

8. Convergence of policies: supply side • Increasing toughness towards sellers • More arrested • Longer statutory sentences • Longer actual sentences • US exceptional in numbers incarcerated • European intensity probably one tenth

9. European arrest figures rising

10. Drug-law offences / arrests • In most countries use and possession still account for majority of arrests • cannabis offences dominate • Very few cannabis arrests lead to prison sentences

11. Arrests for use/possession and dealing/trafficking

12. Drug consumption Western drug use largely stable or declining • Marijuana prevalence rates among youth falling • Some exceptions • Heroin dependent population aging and declining • Cocaine rising in Europe, falling in US • ATS patterns complex but numbers still rather small (with some exceptions, e.g. CZ)

13. US High School Senior Use 1975-2007

14. Experimentation with cannabis is common in Western countries

15. Total US Cocaine consumption 1988-2000 (in metric tons)

16. Consumption indicators for non-Western countries are weak • Cannabis use generally much lower than in US • e.g. 2005 survey Mexico City: 3.2% of 12-17 year olds report ever using marijuana • U.S figure 10 times as high • Heroin use stable except for major epidemic in Russia and Central Asia • Cocaine use slight outside of Western countries and a few in South America • Mexico still modest use levels despite its trans-shipment role • ATS unclear • Prevalence figures are stabilising in some (advanced) transitional countries in the past decade. • Drug use prevalence increased in developing countries.

17. Supply side changes modest: opiates and cocaine • The production of opiates and cocaine is concentrated in very few countries • Afghanistan is by far the main producer of opium, Colombia of coca • No changes which countries produce, just some shifts in distribution across countries

18. Supply side changes unclear and rather negative: ATS • ATS production is spread over several countries; • The number of production countries increased in past decade; • New producers: in particular transitional countries; • ATS production diverse, from small-scale kitchen laboratories to large industrial-scale laboratories; • Some shifts in quantities produced from countries with intensified control to countries with less control.

19. Supply side changes diffuse and rather negative: Cannabis • Cannabis production in more than 172 countries. • Cannabis resin production more concentrated than cannabis herb production; • cannabis resin in 58 • 116 for cannabis herb production. • Mexico and Morocco only large scale exporters but account for small share of total consumption • An increasing number of countries are involved in cannabis herb production. • Cannabis herb production takes diverse forms, from small-scale home growing to large-scale agricultural business

20. Supply side changes: trafficking • Impact of anti-trafficking measures on quantities trafficked hard to measure • Seizures indicator for trafficking routes rather than for trafficked quantities • Changes in trafficking routes occur every few years • Central Asia heroin trafficking post-1995 • West African cocaine route post-2005

21. Unintended policy consequences on drugs market • Increasing interdiction rates for trafficking may lead to greater export demand; • Violence of producers, traffickers, dealers and users as response to tougher enforcement; • Large black markets generate incentives for corruption; • Environmental and health damage caused by enforcement induced replacement of big methamphetamine laboratories by smaller labs using varying ingredients

22. Despite supply reduction efforts: prices have declined, e.g. in EU

23. US cocaine and heroin prices have declined

24. US enforcement up, prices down

25. Control efforts have minimal effect on global drug supply Examples: • Increased control efforts not reflected in prices of illicit drugs, especially in Western countries • Policy can reduce the nature and location of harms related to production and trafficking • Interventions can affect where production and trafficking occurs • Balloon effect: control efforts in Peru and Bolivia shift production to Colombia • 'Closing' of Netherlands Antilles smuggling route for cocaine to Europe may have supported West African route

26. Drug policy has limited effects on drug demand • Drug use is driven by broader social, economic and cultural factors • Policy measures can not affect: • Whether an epidemic starts • Severity of epidemic • Prevalence of dependence • Policy can reduce harmfulness of drug use • Drug problems drive drug policy

27. Selection of 18 countries for detailed study Criteria for selecting countries • Size (China and India) • Major role in production and/or trafficking (Iran and Colombia) • Major consumers (the United States) • Coverage of all regions of the globe • Substantial differences in the drugs problem they face (production, trafficking and use) • Differences in societal changes during the past ten years; • Western • Transitional • Developing

28. Selected countries

29. Principal methodological issues • No primary data collection • Analysed available data sources • EMCDDA, UNODC, national studies, expert opinion • Conceptual challenges: • Differences across nations in concepts and terminology (e.g. problem drug use) • Empirical challenges: • Data quality (e.g. political interests) • Data scarcity • Data inconsistency (e.g. differences in age groups and periods covered) • Data on non-Western countries extremely limited

30. Production is very low cost