NAFTA and the Drug Threat

THE North American Free Trade Agreement (NAFTA) has run into another potential obstacle - narcotics smuggling.

There is growing concern that the agreement, which would lower trade barriers between the United States, Mexico, and Canada, would also let down America's guard against illegal drugs.

Mexico already is America's major source of marijuana, and a leading supplier of heroin. Most of the cocaine that reaches the US also passes through Mexico.

The latest controversy erupted when the National Security Archive (NSA), a private research group, obtained a confidential memorandum from the US Embassy in Mexico City. NSA got the document through the Freedom of Information Act.

Written by an American intelligence officer, the memo warns that "well-known drug organizations" in Mexico are setting up business fronts to facilitate illegal drug exports to the US. The fronts, located near the Mexico-US border, include assembly plants, recycling operations, and warehouses, the memo indicates.

Reinforcing the memo's urgency, Mexico's recent upsurge in narco-violence spilled onto the front pages when drug traffickers last week gunned down Roman Catholic Cardinal Juan Jesus Posadas Ocampo at the Guadalajara, Mexico, airport. The killers apparently mistook Cardinal Posadas for a rival dealer.

The two events set off alarm bells in Congress, which will vote on NAFTA later this year. Even supporters of NAFTA expressed concern. "This is a serious problem. It can't be minimized, nor swept under the table," says George Grayson, an expert on Mexico, and author of a new Foreign Policy Association monograph on NAFTA.

Two members of Congress, Rep. Helen Bentley (R) of Maryland and Rep. Marcy Kaptur (D) of Ohio, immediately fired off a bipartisan "Dear Colleague" letter, saying: "Congress should not approve the NAFTA deal unless it and our borders are locked tight from drug runners."

Some independent experts strongly disagree with those views, however. They say the narcotics threat is being overblown.

Peter Reuter, co-director of the RAND Drug Policy Research Center, says: "It is not difficult to smuggle cocaine into this country. Making it a little cheaper [because of NAFTA] isn't going to make a major difference."

Even without free trade, Dr. Reuter notes, Mexico became the major source of illegal drugs in the US at least five years ago.

Colleen Morton, vice president of the Institute of the Americas in San Diego, says closer ties to Mexico might actually help control the illicit drug trade.

"The drug problem has been a very divisive and difficult problem between the US and Mexico, so anything we can do to improve the relationship between the two countries should help," Ms. Morton says.

A State Department official concedes that free trade would probably help drug smugglers, but discounts the threat. The official, who asked not to be identified, explains: "If you look at Europe, where they lowered barriers, there is an increased movement of all kinds, legitimate and not legitimate. With the tremendous benefits of lower trade barriers, there will also be a downside. One of those is, it will be harder for Customs to find the needle in a much larger haystack."

However, the official sees no rush to send more drugs to the US, even if smugglers have the chance. "US demand [for illegal drugs] is going down, and they are getting enough through now.... More drugs could make prices fall."

A US Customs official in Houston says that even before NAFTA passes Congress, "Mexico changed their entire inspection process [along the US border] to show that they were cooperating" against drug smuggling.

Customs also is beefing up its inspection forces prior to NAFTA, which would bring a sharp increase in truck traffic. The Southwest border region, which extends from eastern Texas to western Arizona, will add 100 Customs inspectors by Sept. 30, with more hiring slated for 1994.

In addition, Customs is spending $350 million over a three-year period in the Southwest region to construct state-of-the-art inspection facilities.

Nevertheless, there are serious concerns. Mexico's drug problems remain, despite valiant efforts by some members of the Mexican government, its law enforcement agencies, and the Mexican military. Vicious Colombian-style gang violence has increased alarmingly.

An analysis of Mexico's illicit drug industry released in April by the State Department found little to cheer about. Among its findings:

* Cocaine. Most comes from Colombia, but up to 70 percent of the US supply transits through Mexico. On the plus side, Mexico has disrupted smugglers' air operations, and forced them to use riskier land and sea routes.

* Heroin. Mexico has cut opium poppy production to "the lowest level in nearly a decade," State reports. But Mexico, along with Burma, remain the leading US sources.

* Marijuana. Mexico supplies 87 percent of the world's crop.

* Chemicals. Almost the entire supply of chemicals used to produce cocaine in South America comes from Mexico.

* Corruption. Deep-seated corruption at "many levels" of the Mexican government hampers the drug fight, through President Salinas should get credit for "concerted war on official corruption," State says.

* Money laundering. Mexico lacks controls on large currency transactions. This facilitates the laundering of profits from illegal drugs.

Dr. Grayson says: "One of the ironies for the Salinas administration is that at the same time it is spending tens of millions of dollars to improve Mexico's image with inside-the-beltway lobbying and public relations, actions over which he has no control have worsened the liklihood that NAFTA will be approved."