The media, and scholarly works, are dense with narratives of the high revenues and profitability of the illegal drugs trade. Informed by estimates of the gross returns on drug smuggling at the border and in western consumer markets, these narratives ignore the high cost of “doing business.” This chapter, published in The Routledge Handbook of Smuggling 2021, documents empirical research along the length of the value chain for opium in Afghanistan, and across its international borders. It describes an illicit economy that is distributive, in which a wide range of communities and groups are involved and derive significant income, employment and rent from the trade in illicit opium. It outlines a highly segmented value chain, with different actors responsible for the trade, transportation and regulation of opium across specific and boundaried terrain. This is a high-cost trade with relatively low net profits, where opium needs to be moved in volume to generate sufficient income for the multiplicity of actors involved. This analysis of the value chain suggests that investments in risk management and informal regulatory regimes in the opium trade in Afghanistan are critical to the trade, not just for smugglers to avoid getting caught but for the financial solvency of drugs traders themselves.
