Follow the money. It's an old adage, but one of the best. And journalist Gretchen Peters knows this more than most. For some years now she has been researching the nexus between money and the various Taliban factions, in particular looking into the opium trade in her book Seeds of Terror, and her pamphlet How Opium Profits the Taliban for the US Institute of Peace.
Now she has produced Haqqani Network Financing: The Evolution of an Industry for the Combating Terrorism Center at West Point. Her groundbreaking study shows in some detail how this remarkable Afghan clan has been able to build up unique cash-generating business enterprises to finance its very effective campaign against the Karzai government and its Western allies.
From its base in Pakistan's North Waziristan - where it exists with the blessing of the ISI - the Haqqanis have created a mafia-like empire that now stretches across Pakistan and into the Gulf. Peters says the Haqqani network is involved in an array of illegal activities: it extorts from businesses in Afghanistan's south-east and in FATA; takes part in kidnap-for-ransom schemes; protects and taxes illicit smuggling rings as well as smuggling itself; has partial ownership stakes in dozens, if not hundreds, of real estate holdings and in construction firms, import-export operations and transport businesses; raises donations from ideological supporters; and finally, is involved in large-scale money laundering.
Peters says that whilst conventional wisdom suggests that all these activities are directed towards supporting the network's military and religious objectives, in fact they are also an end in themselves. She sums it up like this:
"This report will make the case that the Haqqanis have evolved over more than three decades into an efficient mafia-type network exhibiting robust relationships with regional political, military and economic circles, and that members of the group have a financial incentive to remain the dealmakers and the enforcers in their area of operations. The report will also demonstrate how the Haqqanis’ involvement in criminal and profit-making activities has diversified over time in pragmatic response to shifting funding conditions and economic opportunities. At each stage of the group’s history, Haqqani network leaders have leveraged strategic alliances and relationships to consolidate their position of authority within the community and to secure their sources of funding."
Peters says that continued warfare in Afghanistan benefits the Haqqanis financially and that they have little incentive to end the fighting or to give up the autonomy they have found in Pakistan's tribal areas. The network's comparatively small size means its members can adapt to changes very quickly, whilst making it difficult for outsiders to penetrate. It does, however, have weaknesses, including repetitive behaviour, paranoia over traitors and a leadership which may be too small and too centralised.
What is most remarkable is that the network's finances have never come under sustained attack, in part because it is protected by the Pakistani state, but also because US war planners are too focussed on military activity to understand how to take on this kind of enemy. As Peters says: "a stepped‐up U.S. effort to identify and disrupt Haqqani business activities and logistical supply lines, modeled on previous successful campaigns against other transnational crime networks around the globe, could significantly degrade the network’s capacity to cause trouble." Is anyone listening?
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