AFGHANISTAN RESEARCH AND EVALUATION UNIT - A Taxing Narrative: Miscalculating Revenues and

The assumption that the Taliban collected significant amounts of money taxing the cultivation of opium, the production of opiates, and on the smuggling of drugs across Afghanistan’s borders is the bedrock on which a narrative of a narco-insurgency was constructed. [...] Even the Taliban’s prohibition of opium in 2000—described by a senior member of UNODC at the time as “one of the most remarkable successes ever”—is viewed by parts of the UN, western analysts, and some donors as a cynical ploy designed to increase prices and the value of what was believed to be an accumulated stock, due to the belief that the Taliban’s primary source of finance was illegal drugs. [...] The failure to address this corruption and the Taliban’s other sources of financial support, including that of foreign donors, left the US and its allies blind to the risks to the Afghan Republic and ill-equipped to counter the rise of the Taliban as a political and military force. [...] In the current environment it is difficult to see how the Taliban will be able to generate more than $0.75 billion per annum in revenues and there is a high risk of a return to the minimalist state of the 1990s, where the regime focused solely on security and justice, and basic services were provided under the rubric of humanitarian assistance. [...] In the case of Afghanistan, much of the data on Taliban funding have been misleading and helped shape policies that have alienated the rural population and left donors blind to the risks to the Afghan Republic and ill- equipped to counter the rise of the Taliban as a political and military force.