Annual worldwide illegal drug sales are greater than the gross domestic product of 88 percent of the countries in the world, the U.N. said on Wednesday.

“This is not a small enemy against which we struggle. It is a monster,” Antonio Maria Costa, head of the United Nations Office on Drugs and Crime (UNODC), said in an annual report.

Costa offered one tale of success. The southeast Asian “Golden Triangle”, once a major centre of illicit poppy cultivation, could be declared opium free by 2007 thanks partly to anti-drug operations by regional governments, he said.

But the overall picture appeared bleak.

The UN report, issued in Stockholm, said the global drug trade generated an estimated $321.6 billion in 2003, the latest year for which figures were available.

“The size of the world’s illicit drug industry is thus equivalent to 0.9 percent of the world’s GDP or higher than the GDP of 88 percent of the countries in the world,” Carsten Hyttel, East African representative of the U.N. Office on Drugs and Crime (UNODC), told a Nairobi news conference.

It was the first time the U.N. drugs agency had made an estimate of the worth of the world’s illegal drug market, which it said was necessary to understand the breadth of its influence and ability to destabilise countries.

“Its ‘companies’ are not listed on the stock exchange, they are not valued by any private accounting firm and the dynamics of the drug industry are not regularly pored over by analysts, economists and forecasters,” the report said.

The bulk of the money - $214 billion - was made at the retail level; drugs sold in streets and back alleys.

North America was the biggest buyer, and accounted for 44 percent of all estimated sales, followed by Europe with 33 percent. Africa was in last place with only 4 percent.

HEROIN

The main problem drugs continue to be opiates - mainly heroin - and cocaine, which accounted for the bulk of almost 22 million people the report termed problem drug users. The outlook for supply of such drugs would be determined by conditions in major producers such as Afghanistan.

“The story of heroin production today is basically the story of Afghanistan,” Costa said.

The 2004 Afghan presidential elections meant the picture there had improved, as the government strengthened control over the economy. The area under poppy cultivation had also fallen.

The report said opium production in the Golden Triangle straddling Myanmar, Laos and Thailand, which a few years ago accounted for most of the world’s opium poppy cultivation, was 78 percent lower than in 1996.

“We may be able to declare the whole of the Golden Triangle opium free by 2007, closing a very sad chapter,” Costa said.

However, South American cocaine output did not fall and the area under cultivation rose in Peru and Bolivia.

The international community needed to continue to support programmes to allow farmers to grow alternative crops, it said.