SUBJECT: Presidential Determination on Major Illicit Drug Transit or Major Illicit Drug Producing Countries for Fiscal Year 2010

Pursuant to section 706(1) of the Foreign Relations Authorization Act, Fiscal Year 2003 (Public Law 107-228)(FRAA), I hereby identify the following countries as major drug transit or major illicit drug producing countries: Afghanistan, The Bahamas, Bolivia, Brazil, Burma, Colombia, Dominican Republic, Ecuador, Guatemala, Haiti, India, Jamaica, Laos, Mexico, Nigeria, Pakistan, Panama, Paraguay, Peru, and Venezuela.

A country's presence on the Majors List is not necessarily an adverse reflection of its government's counternarcotics efforts or level of cooperation with the United States. Consistent with the statutory definition of a major drug transit or drug producing country set forth in section 481(e)(2) and (5) of the Foreign Assistance Act of 1961, as amended (FAA), one of the reasons that major drug transit or illicit drug producing countries are placed on the list is the combination of geographic, commercial, and economic factors that allow drugs to transit or be produced despite the concerned government's most assiduous enforcement measures.

Pursuant to section 706(2)(A) of the FRAA, I hereby designate Bolivia, Burma, and Venezuela as countries that have failed demonstrably during the previous 12 months to adhere to their obligations under international counternarcotics agreements and take the measures set forth in section 489(a)(1) of the FAA. Attached to this report are justifications for the determinations on Bolivia, Burma, and Venezuela, as required by section 706(2)(B).

I have also determined, in accordance with provisions of section 706(3)(A) of the FRAA, that support for programs to aid Venezuela's democratic institutions and continued support for bilateral programs in Bolivia are vital to the national interests of the United States.

Afghanistan continues to be the world's largest producer of opium poppy and a major source of heroin. The Government of Afghanistan, under the leadership of President Karzai and key governors in the provinces, has demonstrated its ongoing commitment to combating narcotics and has made notable improvements in this regard over the past year.

The connection between opium production, the resulting narcotics trade, corruption, and the insurgency continues to grow more evident in Afghanistan. Poppy cultivation remains largely confined to five contiguous provinces in the south where security problems greatly impede counternarcotics efforts, and nearly all significant poppy cultivation occurs in insecure areas with active insurgent elements. Counternarcotics efforts have shown greater impact where security exists, where public information messages can be conveyed, alternative development delivered, interdiction performed, and justice carried out. While the Government of Afghanistan made some progress during the past year, the country must dedicate far greater political will and programmatic effort to combat opium trafficking and production nationwide.

Pakistan is a major transit country for opiates and hashish for markets around the world, as well as for precursor chemicals moving into neighboring Afghanistan where they are used for processing heroin. Opium poppy cultivation in Pakistan is also a primary concern.

In 2008 and 2009, religious extremist groups controlled major portions of the Federally Administered Tribal Areas, where most of Pakistan's poppy is grown. These extremist groups also pushed into settled areas of the country's Northwest Frontier Province, such as the Peshawar Valley and the Swat Valley. The Government of Pakistan was compelled to divert manpower and equipment resources from poppy eradication efforts to contest these incursions.

The joint Narcotics Affairs Section and Pakistan's Narcotics Control Cell indicated that 1,909 hectares of poppy were cultivated in 2008 (approximately one percent of the cultivation in Afghanistan). This is down from the 2,315 hectares cultivated in 2007. In 2007, when the insurgent problem was not as widespread, 614 hectares were eradicated, bringing harvested poppy down to 1,701 hectares. During 2008, there were significant narcotics and precursor chemical seizures in Pakistan. United States counternarcotics and border security assistance programs continue to build the counternarcotics capacity of law enforcement agencies, especially in Baluchistan and along the Makran coast.

As Mexico and Colombia continue to apply pressure on drug traffickers, the countries of Central America are increasingly targeted for trafficking, which is creating serious challenges for the region. In 2008, approximately 42 percent of the cocaine destined for the United States transited Central America directly from South America. Often unimpeded due to the region's limited capabilities and resources, traffickers use land routes and Central America's coastal waters for illegal drug movements. The Merida Initiative, which provides Central American countries $165 million for FY 2008 and FY 2009, offers the opportunity to boost the capabilities of the region's rule of law institutions and promote greater regional law enforcement cooperation.

Within the Central America region, Guatemala has been listed as a major drug transit country since 1990. Guatemala continues to be challenged by increasing violence related to narcotics trafficking. Corruption and inadequate law enforcement efforts contributed to low interdiction levels during the past several years. The United States continues to support the Government of Guatemala to improve its counternarcotics efforts.

In Honduras, drug traffickers have capitalized on the country's lack of resources, corruption, and ungoverned spaces. Despite the current political instability, Honduran security forces have been conducting counternarcotic operations and have already seized more illegal drugs than in all of 2008. Honduras has also agreed to a bilateral integrated strategy with the United States to strengthen the operational counternarcotics capabilities of its security and law enforcement forces.

Panama is a major drug transit country that seized 51 metric tons of cocaine in 2008 while working in partnership with the United States. El Salvador is not a primary transit country, but in 2008 the Salvadoran government seized 1.4 metric tons of cocaine, 300 kilograms of marijuana, and nine kilograms of heroin. El Salvador may see an increase in drug activity corresponding with rising drug trafficking levels in the eastern Pacific. The United States is increasingly concerned with the large amount of drugs trafficked through Costa Rica and Nicaragua. Interdiction efforts in these two countries in 2008 resulted in the seizure of 21.7 and 19.5 metric tons of cocaine seizures, respectively.

The trafficking of South American cocaine through Nigeria and other West African countries en route to Europe continues. Though the cocaine does not come to the United States, the proceeds of the trafficking flow back to the same organizations that move cocaine to the United States, reinforcing their financial strength. Drug trafficking is a destabilizing force in the region and undermines good governance. Initially focused on Guinea and Guinea-Bissau, drug trafficking is now a serious issue facing nearly all West African countries. There is limited capacity in many West African law enforcement and judicial sectors to investigate and prosecute the organizers of cocaine trafficking. Despite this, there have been some important counternarcotics victories, most notably in the arrest and successful prosecution of traffickers in Sierra Leone.

Nigeria, which remains a significant transit point for narcotics destined for the United States, made demonstrable progress in 2008 by combating narcotics through increased budgetary support of key counternarcotics and corruption agencies, continued evaluation of suspicious transaction reports, and acceptable progress in the arrests of drug kingpins, with one kingpin arrested in 2008 and another in early 2009. Drug seizures were down slightly from a high in 2007. However, this development is likely attributable to a decrease in the use of Nigeria's international airports as a transshipment point after the successful deployment of narcotics scanning machines by the Nigerian Drug Law Enforcement Agency (NDLEA). At the same time, there was little progress in reform to expedite Nigerian extradition procedures, or to amend its Money Laundering Act to bring it in line with international standards. Cooperation between the NDLEA and U.S. law enforcement agencies remains robust.

International donors and organizations are working to assist West African governments in their counternarcotics efforts. The United States supports these efforts to preserve and protect stability and positive growth in this region.

The United States continues to maintain a strong and productive law enforcement relationship with Canada. Both countries are making significant efforts to disrupt the two-way flow of drugs, bulk currency, and other contraband. Canada remains a significant producer of MDMA (ecstasy) and high-potency marijuana that is trafficked to the United States. While Canada's passage of several additional regulations in recent years has reduced the large scale diversion and smuggling of bulk precursor chemicals across the border, the increasing diversion of these chemicals to the production of methamphetamine within Canada could lead to greater methamphetamine availability in the United States. The frequent mixing of methamphetamine and other illegal drugs into pills that are marketed as MDMA by Canada-based criminal groups poses a particularly significant public health risk in the United States. The United States Government is appreciative of Canada's efforts to address these and other drug-related challenges, including through bilateral initiatives and multilateral forums.

The Government of India maintains a credible record of regulating its licit opium grown for the production of pharmaceutical products through licensed opium farmers and monitoring of poppy cultivation sites. Diversion of licit opium crops into illegal markets continues despite India's determined efforts to control such activity. Illicit opium poppy production has also been observed in certain areas of the country, such as West Bengal and the State of Uttaranchal. Enforcement agencies continue to eradicate illicit opium poppy crops although the actual number of hectares destroyed has declined in recent years. Indian authorities have made marked efforts to control the illicit drug trade as opium and heroin smuggled from Afghanistan and Pakistan enters India across the India-Pakistan border and is trafficked to destinations outside of India.

Indian authorities continue to pursue precursor chemical trafficking organizations operating in the country and to cooperate with international law enforcement counterparts to interdict the flow of narcotics. The Government of India has made noteworthy international efforts to target the misuse of internet pharmacies for trafficking controlled and non-controlled pharmaceuticals. Law enforcement undertakings in this area have resulted in numerous arrests and asset seizures in both the United States and India.

You are hereby authorized and directed to submit this report under section 706 of the FRAA, transmit it to the Congress, and publish it in the Federal Register.