Part 304

Congo, Democratic Republic of the one of Africa's biggest producers of cannabis, but mostly for domestic consumption; traffickers exploit lax shipping controls to transit pseudoephedrine through the capital; while rampant corruption and inadequate supervision leaves the banking system vulnerable to money laundering, the lack of a well-developed financial system limits the country's utility as a money-laundering center (2008)

Costa Rica transshipment country for cocaine and heroin from South America; illicit production of cannabis in remote areas; domestic cocaine consumption, particularly crack cocaine, is rising; significant consumption of amphetamines; seizures of smuggled cash in Costa Rica and at the main border crossing to enter Costa Rica from Nicaragua have risen in recent years (2008)

Cote d'Ivoire illicit producer of cannabis, mostly for local consumption; utility as a narcotic transshipment point to Europe reduced by ongoing political instability; while rampant corruption and inadequate supervision leave the banking system vulnerable to money laundering, the lack of a developed financial system limits the country's utility as a major money-laundering center (2008)

Croatia transit point along the Balkan route for Southwest Asian heroin to Western Europe; has been used as a transit point for maritime shipments of South American cocaine bound for Western Europe (2008)

Cuba territorial waters and air space serve as transshipment zone for US- and European-bound drugs; established the death penalty for certain drug-related crimes in 1999 (2008)

Cyprus minor transit point for heroin and hashish via air routes and container traffic to Europe, especially from Lebanon and Turkey; some cocaine transits as well; despite a strengthening of anti-money-laundering legislation, remains vulnerable to money laundering; reporting of suspicious transactions in offshore sector remains weak (2008)

Czech Republic transshipment point for Southwest Asian heroin and minor transit point for Latin American cocaine to Western Europe; producer of synthetic drugs for local and regional markets; susceptible to money laundering related to drug trafficking, organized crime; significant consumer of ecstasy (2008)

Dominica transshipment point for narcotics bound for the US and Europe; minor cannabis producer (2008)

Dominican Republic transshipment point for South American drugs destined for the US and Europe; has become a transshipment point for ecstasy from the Netherlands and Belgium destined for US and Canada; substantial money laundering activity in particular by Colombian narcotics traffickers; significant amphetamine consumption (2008)

Ecuador significant transit country for cocaine originating in Colombia and Peru, with much of the US-bound cocaine passing through Ecuadorian Pacific waters; importer of precursor chemicals used in production of illicit narcotics; attractive location for cash-placement by drug traffickers laundering money because of dollarization and weak anti-money-laundering regime; increased activity on the northern frontier by trafficking groups and Colombian insurgents (2008)

Egypt transit point for cannabis, heroin, and opium moving to Europe, Israel, and North Africa; transit stop for Nigerian drug couriers; concern as money laundering site due to lax enforcement of financial regulations

El Salvador transshipment point for cocaine; small amounts of marijuana produced for local consumption; significant use of cocaine

Estonia growing producer of synthetic drugs; increasingly important transshipment zone for cannabis, cocaine, opiates, and synthetic drugs since joining the European Union and the Schengen Accord; potential money laundering related to organized crime and drug trafficking is a concern, as is possible use of the gambling sector to launder funds; major use of opiates and ecstasy

Ethiopia transit hub for heroin originating in Southwest and Southeast Asia and destined for Europe, as well as cocaine destined for markets in southern Africa; cultivates qat (khat) for local use and regional export, principally to Djibouti and Somalia (legal in all three countries); the lack of a well-developed financial system limits the country's utility as a money laundering center

France metropolitan France: transshipment point for South American cocaine, Southwest Asian heroin, and European synthetics French Guiana: small amount of marijuana grown for local consumption; minor transshipment point to Europe Martinique: transshipment point for cocaine and marijuana bound for the US and Europe

Georgia limited cultivation of cannabis and opium poppy, mostly for domestic consumption; used as transshipment point for opiates via Central Asia to Western Europe and Russia

Germany source of precursor chemicals for South American cocaine processors; transshipment point for and consumer of Southwest Asian heroin, Latin American cocaine, and European-produced synthetic drugs; major financial center

Ghana illicit producer of cannabis for the international drug trade; major transit hub for Southwest and Southeast Asian heroin and, to a lesser extent, South American cocaine destined for Europe and the US; widespread crime and money laundering problem, but the lack of a well developed financial infrastructure limits the country's utility as a money laundering center; significant domestic cocaine and cannabis use

Greece a gateway to Europe for traffickers smuggling cannabis and heroin from the Middle East and Southwest Asia to the West and precursor chemicals to the East; some South American cocaine transits or is consumed in Greece; money laundering related to drug trafficking and organized crime

Grenada small-scale cannabis cultivation; lesser transshipment point for marijuana and cocaine to US

Guatemala major transit country for cocaine and heroin; in 2005, cultivated 100 hectares of opium poppy after reemerging as a potential source of opium in 2004; potential production of less than 1 metric ton of pure heroin; marijuana cultivation for mostly domestic consumption; proximity to Mexico makes Guatemala a major staging area for drugs (particularly for cocaine); money laundering is a serious problem; corruption is a major problem

Guinea-Bissau increasingly important transit country for South American cocaine enroute to Europe; enabling environment for trafficker operations thanks to pervasive corruption; archipelago-like geography around the capital facilitates drug smuggling

Guyana transshipment point for narcotics from South America - primarily Venezuela - to Europe and the US; producer of cannabis; rising money laundering related to drug trafficking and human smuggling

Haiti Caribbean transshipment point for cocaine en route to the US and Europe; substantial bulk cash smuggling activity; Colombian narcotics traffickers favor Haiti for illicit financial transactions; pervasive corruption; significant consumer of cannabis

Honduras transshipment point for drugs and narcotics; illicit producer of cannabis, cultivated on small plots and used principally for local consumption; corruption is a major problem; some money-laundering activity

Hong Kong despite strenuous law enforcement efforts, faces difficult challenges in controlling transit of heroin and methamphetamine to regional and world markets; modern banking system provides conduit for money laundering; rising indigenous use of synthetic drugs, especially among young people

Hungary transshipment point for Southwest Asian heroin and cannabis and for South American cocaine destined for Western Europe; limited producer of precursor chemicals, particularly for amphetamine and methamphetamine; efforts to counter money laundering, related to organized crime and drug trafficking are improving but remain vulnerable; significant consumer of ecstasy

India world's largest producer of licit opium for the pharmaceutical trade, but an undetermined quantity of opium is diverted to illicit international drug markets; transit point for illicit narcotics produced in neighboring countries and throughout Southwest Asia; illicit producer of methaqualone; vulnerable to narcotics money laundering through the hawala system; licit ketamine and precursor production

Indonesia illicit producer of cannabis largely for domestic use; producer of methamphetamine and ecstasy

Iran despite substantial interdiction efforts and considerable control measures along the border with Afghanistan, Iran remains one of the primary transshipment routes for Southwest Asian heroin to Europe; suffers one of the highest opiate addiction rates in the world, and has an increasing problem with synthetic drugs; lacks anti-money laundering laws; has reached out to neighboring countries to share counter-drug intelligence

Ireland transshipment point for and consumer of hashish from North Africa to the UK and Netherlands and of European-produced synthetic drugs; increasing consumption of South American cocaine; minor transshipment point for heroin and cocaine destined for Western Europe; despite recent legislation, narcotics-related money laundering - using bureaux de change, trusts, and shell companies involving the offshore financial community - remains a concern

Israel increasingly concerned about ecstasy, cocaine, and heroin abuse; drugs arrive in country from Lebanon and, increasingly, from Jordan; money-laundering center

Italy important gateway for and consumer of Latin American cocaine and Southwest Asian heroin entering the European market; money laundering by organized crime and from smuggling

Jamaica transshipment point for cocaine from South America to North America and Europe; illicit cultivation and consumption of cannabis; government has an active manual cannabis eradication program; corruption is a major concern; substantial money-laundering activity; Colombian narcotics traffickers favor Jamaica for illicit financial transactions

Kazakhstan significant illicit cultivation of cannabis for CIS markets, as well as limited cultivation of opium poppy and ephedra (for the drug ephedrine); limited government eradication of illicit crops; transit point for Southwest Asian narcotics bound for Russia and the rest of Europe; significant consumer of opiates

Kenya widespread harvesting of small plots of marijuana; transit country for South Asian heroin destined for Europe and North America; Indian methaqualone also transits on way to South Africa; significant potential for money-laundering activity given the country's status as a regional financial center; massive corruption, and relatively high levels of narcotics-associated activities

Korea, North for years, from the 1970s into the 2000s, citizens of the Democratic People's Republic of (North) Korea (DPRK), many of them diplomatic employees of the government, were apprehended abroad while trafficking in narcotics, including two in Turkey in December 2004; police investigations in Taiwan and Japan in recent years have linked North Korea to large illicit shipments of heroin and methamphetamine, including an attempt by the North Korean merchant ship Pong Su to deliver 150 kg of heroin to Australia in April 2003

Kyrgyzstan limited illicit cultivation of cannabis and opium poppy for CIS markets; limited government eradication of illicit crops; transit point for Southwest Asian narcotics bound for Russia and the rest of Europe; major consumer of opiates

Laos estimated opium poppy cultivation in 2008 was 1,900 hectares, about a 73% increase from 2007; estimated potential opium production in 2008 more than tripled to 17 metric tons; unsubstantiated reports of domestic methamphetamine production; growing domestic methamphetamine problem (2007)

Latvia transshipment and destination point for cocaine, synthetic drugs, opiates, and cannabis from Southwest Asia, Western Europe, Latin America, and neighboring Balkan countries; despite improved legislation, vulnerable to money laundering due to nascent enforcement capabilities and comparatively weak regulation of offshore companies and the gaming industry; CIS organized crime (including counterfeiting, corruption, extortion, stolen cars, and prostitution) accounts for most laundered proceeds

Lebanon cannabis cultivation dramatically reduced to 2,500 hectares in 2002 despite continued significant cannabis consumption; opium poppy cultivation minimal; small amounts of Latin American cocaine and Southwest Asian heroin transit country on way to European markets and for Middle Eastern consumption; money laundering of drug proceeds fuels concern that extremists are benefiting from drug trafficking

Liberia transshipment point for Southeast and Southwest Asian heroin and South American cocaine for the European and US markets; corruption, criminal activity, arms-dealing, and diamond trade provide significant potential for money laundering, but the lack of well-developed financial system limits the country's utility as a major money-laundering center

Liechtenstein has strengthened money laundering controls, but money laundering remains a concern due to Liechtenstein's sophisticated offshore financial services sector

Lithuania transshipment and destination point for cannabis, cocaine, ecstasy, and opiates from Southwest Asia, Latin America, Western Europe, and neighboring Baltic countries; growing production of high-quality amphetamines, but limited production of cannabis, methamphetamines; susceptible to money laundering despite changes to banking legislation

Macau transshipment point for drugs going into mainland China; consumer of opiates and amphetamines

Macedonia major transshipment point for Southwest Asian heroin and hashish; minor transit point for South American cocaine destined for Europe; although not a financial center and most criminal activity is thought to be domestic, money laundering is a problem due to a mostly cash-based economy and weak enforcement

Madagascar illicit producer of cannabis (cultivated and wild varieties) used mostly for domestic consumption; transshipment point for heroin

Malaysia drug trafficking prosecuted vigorously and carries severe penalties; heroin still primary drug of abuse, but synthetic drug demand remains strong; continued ecstasy and methamphetamine producer for domestic users and, to a lesser extent, the regional drug market

Malta minor transshipment point for hashish from North Africa to Western Europe

Mauritius consumer and transshipment point for heroin from South Asia; small amounts of cannabis produced and consumed locally; significant offshore financial industry creates potential for money laundering, but corruption levels are relatively low and the government appears generally to be committed to regulating its banking industry

Mexico major drug-producing nation; cultivation of opium poppy in 2007 rose to 6,900 hectares yielding a potential production of 18 metric tons of pure heroin, or 50 metric tons of "black tar" heroin, the dominant form of Mexican heroin in the western United States; marijuana cultivation increased to 8,900 hectares in 2007 and yielded a potential production of 15,800 metric tons; government conducts the largest independent illicit-crop eradication program in the world; continues as the primary transshipment country for US-bound cocaine from South America, with an estimated 90% of annual cocaine movements toward the US stopping in Mexico; major drug syndicates control the majority of drug trafficking throughout the country; producer and distributor of ecstasy; significant money-laundering center; major supplier of heroin and largest foreign supplier of marijuana and methamphetamine to the US market (2007)

Micronesia, Federated States of major consumer of cannabis

Moldova limited cultivation of opium poppy and cannabis, mostly for CIS consumption; transshipment point for illicit drugs from Southwest Asia via Central Asia to Russia, Western Europe, and possibly the US; widespread crime and underground economic activity

Montserrat transshipment point for South American narcotics destined for the US and Europe

Morocco one of the world's largest producers of illicit hashish; shipments of hashish mostly directed to Western Europe; transit point for cocaine from South America destined for Western Europe; significant consumer of cannabis

Mozambique southern African transit point for South Asian hashish and heroin, and South American cocaine probably destined for the European and South African markets; producer of cannabis (for local consumption) and methaqualone (for export to South Africa); corruption and poor regulatory capability makes the banking system vulnerable to money laundering, but the lack of a well-developed financial infrastructure limits the country's utility as a money-laundering center

Nepal illicit producer of cannabis and hashish for the domestic and international drug markets; transit point for opiates from Southeast Asia to the West

Netherlands major European producer of synthetic drugs, including ecstasy, and cannabis cultivator; important gateway for cocaine, heroin, and hashish entering Europe; major source of US-bound ecstasy; large financial sector vulnerable to money laundering; significant consumer of ecstasy

New Zealand significant consumer of amphetamines

Nicaragua transshipment point for cocaine destined for the US and transshipment point for arms-for-drugs dealing

Nigeria a transit point for heroin and cocaine intended for European, East Asian, and North American markets; consumer of amphetamines; safe haven for Nigerian narcotraffickers operating worldwide; major money-laundering center; massive corruption and criminal activity; Nigeria has improved some anti-money-laundering controls, resulting in its removal from the Financial Action Task Force's (FATF's) Noncooperative Countries and Territories List in June 2006; Nigeria's anti-money-laundering regime continues to be monitored by FATF

Pakistan significant transit area for Afghan drugs, including heroin, opium, morphine, and hashish, bound for Iran, Western markets, the Gulf States, Africa, and Asia; financial crimes related to drug trafficking, terrorism, corruption, and smuggling remain problems; opium poppy cultivation estimated to be 2,300 hectares in 2007 with 600 of those hectares eradicated; federal and provincial authorities continue to conduct anti-poppy campaigns that utilizes forced eradication, fines, and arrests

Panama major cocaine transshipment point and primary money-laundering center for narcotics revenue; money-laundering activity is especially heavy in the Colon Free Zone; offshore financial center; negligible signs of coca cultivation; monitoring of financial transactions is improving; official corruption remains a major problem

Papua New Guinea major consumer of cannabis

Paraguay major illicit producer of cannabis, most or all of which is consumed in Brazil, Argentina, and Chile; transshipment country for Andean cocaine headed for Brazil, other Southern Cone markets, and Europe; weak border controls, extensive corruption and money-laundering activity, especially in the Tri-Border Area; weak anti-money-laundering laws and enforcement

Peru until 1996 the world's largest coca leaf producer, Peru is now the world's second largest producer of coca leaf, though it lags far behind Colombia; cultivation of coca in Peru declined to 36,000 hectares in 2007; second largest producer of cocaine, estimated at 210 metric tons of potential pure cocaine in 2007; finished cocaine is shipped out from Pacific ports to the international drug market; increasing amounts of base and finished cocaine, however, are being moved to Brazil, Chile, Argentina, and Bolivia for use in the Southern Cone or transshipment to Europe and Africa; increasing domestic drug consumption

Philippines domestic methamphetamine production has been a growing problem in recent years despite government crackdowns; major consumer of amphetamines; longstanding marijuana producer mainly in rural areas where Manila's control is limited

Poland despite diligent counternarcotics measures and international information sharing on cross-border crimes, a major illicit producer of synthetic drugs for the international market; minor transshipment point for Southwest Asian heroin and Latin American cocaine to Western Europe

Portugal seizing record amounts of Latin American cocaine destined for Europe; a European gateway for Southwest Asian heroin; transshipment point for hashish from North Africa to Europe; consumer of Southwest Asian heroin

Romania major transshipment point for Southwest Asian heroin transiting the Balkan route and small amounts of Latin American cocaine bound for Western Europe; although not a significant financial center, role as a narcotics conduit leaves it vulnerable to laundering, which occurs via the banking system, currency exchange houses, and casinos

Russia limited cultivation of illicit cannabis and opium poppy and producer of methamphetamine, mostly for domestic consumption; government has active illicit crop eradication program; used as transshipment point for Asian opiates, cannabis, and Latin American cocaine bound for growing domestic markets, to a lesser extent Western and Central Europe, and occasionally to the US; major source of heroin precursor chemicals; corruption and organized crime are key concerns; major consumer of opiates

Saint Kitts and Nevis transshipment point for South American drugs destined for the US and Europe; some money-laundering activity

Saint Lucia transit point for South American drugs destined for the US and Europe

Saint Vincent and the Grenadines transshipment point for South American drugs destined for the US and Europe; small-scale cannabis cultivation

Saudi Arabia death penalty for traffickers; improving anti-money-laundering legislation and enforcement

Senegal transshipment point for Southwest and Southeast Asian heroin and South American cocaine moving to Europe and North America; illicit cultivator of cannabis

Serbia transshipment point for Southwest Asian heroin moving to Western Europe on the Balkan route; economy vulnerable to money laundering

Singapore drug abuse limited because of aggressive law enforcement efforts; as a transportation and financial services hub, Singapore is vulnerable, despite strict laws and enforcement, as a venue for money laundering

Slovakia transshipment point for Southwest Asian heroin bound for Western Europe; producer of synthetic drugs for regional market; consumer of ecstasy

Slovenia minor transit point for cocaine and Southwest Asian heroin bound for Western Europe, and for precursor chemicals

South Africa transshipment center for heroin, hashish, and cocaine, as well as a major cultivator of marijuana in its own right; cocaine and heroin consumption on the rise; world's largest market for illicit methaqualone, usually imported illegally from India through various east African countries, but increasingly producing its own synthetic drugs for domestic consumption; attractive venue for money launderers given the increasing level of organized criminal and narcotics activity in the region and the size of the South African economy