Al Qaeda: Where’s the money? – Not Dead, but Dying, Part 2

Newsweek recently published an update from their al Qaeda source, Hafiz Hanif, an intermittent al Qaeda cell member who recently tried to rejoin his group North Waziristan.  The article entitled, “Al Qaeda on the Ropes, One Fighter’s Inside Story” is a followup to a previous 2010 interview with Hanif entitled “Inside al Qaeda“.  A great read for those interested in AQ’s demise.  There’s so much in this article that I could write about but today I’m just going to focus on one thing – MONEY.

Many perpetuated the notion immediately after 9/11 that terrorism and al Qaeda’s brand in particular costs very little.  Common analysis peddled via TV news based this measure on the fact that the 9/11 attacks cost only a few hundred thousand dollars to execute yet caused such tremendous damage.  The mistake of this argument arises from analysts confusing the production costs of one attack (9/11/2001) representing the total cost of all al Qaeda operations.  Not so! While the individual attack appears cost effective on a case-by-case basis, operating al Qaeda’s global infrastructure requires millions of dollars every year.  Al Qaeda, throughout their history, has struggled at times to maintain financial support and distribute funding equitably (See Harmony & Disharmony and AQ’s (Mis)Adventures for examples).

No one likes having a friend/guest sleep on your couch and eat all your food for ten years without chipping in on the bill – especially when your friend brings drone missile attacks on your house.  Al Qaeda has likely spent hundreds of millions of dollars over the past decade maintaining its safe haven and routinely shifts large amounts of resources to Taliban groups for protection.  These funds came predominately from wealthy Gulf donors and hinged largely on the connections, image and reputation of Bin Laden – a leader from the Arabian Peninsula.

The recent Newsweek article paints a sad picture of al Qaeda Central’s state in Pakistan and more importantly their financial state.  Here’s an updated report from Hanif related to al Qaeda’s financial situation:

New recruits have stopped coming, Hanif says. “When new people came they brought new blood, enthusiasm, and money. All that has been lost.” The money may be a bigger problem than the manpower, he (Hanif) says. Al Qaeda used to receive millions of dollars a year from Arabian Gulf contributors, but Hanif’s uncle says his contacts tell him the donations have dried up. Instead, he believes, the money is going to the more productive and generally nonviolent Arab Spring movements in North Africa, Syria, and Yemen. “I think Arab people now think the fight should be political at home and not terrorism aimed at the West,” says the uncle. “The peaceful struggle on Arab streets has accomplished more than bin Laden and Zawahiri ever have.”


Hanif recalls how al Qaeda logistics operatives used to visit his unit to ask what the men needed in terms of weapons, medicine, food, and money. And he used to love making supply runs to the bazaar in North Waziristan’s capital, Miran Shah, with pockets full of cash for sweets and tea and to use the Internet. The town is still thronged with Pakistani and Afghan Taliban, shopping side by side with Pakistani soldiers, but now the Arabs have mostly vanished, and the shops specializing in olive oil, Arabian dates, and other Arab favorites are deserted or closed. Fighters subsist on minimal rations—if they aren’t left to fend for them-selves. That’s not easy, since al Qaeda has few friends in the area. Villagers fear that bin Laden’s men could bring drone strikes and the danger of civilian casualties, and al Qaeda has nothing left to offer local militants. The group is broke, and most of its best explosives and technical specialists have either died or left the vicinity. There aren’t even enough fighters left to act as reinforcements

During the AQ Strategy poll and Post-UBL poll in April/May 2011, I asked where will Gulf donor contributions go after UBL’s death.  Most thought donor support to AQ Central in AFPAK would be sustained.  However, ‘Private Sector’ respondents indicated that Islamist groups amongst the Arab uprisings would be the new investment priority.  It appears the ‘Private Sector’ voters may have been the most accurate in their prediction and suggests that if you want to know who will invest and where – ask the private sector as their success or failure hinges on picking winners.

As for me, for now, I’m sticking with my assessment from almost one year ago today – January 16, 2011 – entitled “Thoughts against Zawahiri’s ascension”:

1) Resources

However, UBL’s greatest strength in AQ (since its inception) is distributing money and providing an architecture (The Base) from which to pursue global jihad.  I refer back to page 197 of The Looming Tower where Larry Wright discusses how, “the camaraderie that sustained the men of al-Qaeda rested on the financial security that bin Laden provided,”  In the beginning, UBL used his own wealth to support AQ.  Today, UBL’s presence in AQ brings donations from the Gulf, fund transfers from affiliates like AQIM who divert kidnapping revenues (seen reports to this but can’t confirm it), and the benevolence of the Haqqani network.  We should also remember that Zawahiri came to UBL because of his resources.  When UBL dies, Zawahiri may take control but he will not be able to secure these three resource pipelines.

Here’s a re-post of the graph from the Gulf donor support question the week prior to Bin Laden’s death (AQ Strategy Poll):


And here’s a graph from the same Gulf donor question the week after Bin Laden’s death (Post UBL Poll):


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