Illicit trade

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Illicit trade is the production or distribution of a good or service that is considered illegal by a legislature. [1] It includes trade that is strictly illegal in different jurisdictions, as well as trade that is illegal in some jurisdictions but legal in others. [2]

Contents

Illicit trade can occur either in black markets or in legitimate markets. Some of the most important types of illicit trade include various forms of smuggling, the illegal drug trade, counterfeiting, human trafficking, the illicit tobacco trade, arms trafficking, illicit trafficking of cultural property, and various environmental crimes such as illegal wildlife trade, illegal logging and illegal fishing.

International initiatives to combat illicit trade

While there are several international treaties for dealing with specific types of illicit trade, it is said that a cross-sector approach as well as increased collaboration and communication between stakeholders are necessary to address illicit trade more efficiently. [3] [4] [5]

In 2013, the OECD launched a Task Force Countering on Illicit Trade, [6] which focuses on developing evidence-based research and coordinating international expertise in quantifying and mapping illicit markets. [7]

Since 2013, The World Customs Organization produces a yearly report on illicit trade which uses seizure data and case studies to study illicit trade flows. [8] [9]

In February 2020, UNCTAD held a Forum on illicit trade. One of the main focus of the event was to evaluate how illicit trade impacts negatively the Sustainable Development Goals. [10]

According to the Global Initiative Against Transnational Organized Crime and to Tradeslab, not only the World Trade Organization has rather limited tools to deal with illicit trade, but it may also limit the ability of states to combat it. [11] [12]

Measurements on illicit trade

By considering 12 different illicit markets, Global Financial Integrity estimated the value of illicit trade at $650 billion in 2011. [13]

The UNODC estimated in 2012 that the illicit trade activities of transnational organized crime have a combined annual value of $870 billion per year. [14]

The Economist Intelligence Unit developed in 2018 a Global Illicit Trade Index, which evaluates the structural capacities of 84 countries to fight illicit trade. [15]

Debates and controversies

Several authors and organizations assert that globalization has led to a significant increase of illicit trade, and that it has become a significant global threat. [16] [17] [5] However, some authors argue that illicit trade has not necessarily grown in proportion to licit trade, and that a historical perspective is missing in the current assessment of its importance. [18] [19]

Related Research Articles

<span class="mw-page-title-main">Organized crime</span> Groupings of highly centralized criminal enterprises

Organized crime or organised crime is a category of transnational, national, or local groupings of centralized enterprises run to engage in illegal activity, most commonly for profit. While organized crime is generally thought of as a form of illegal business, some criminal organizations, such as terrorist groups, rebel forces, and separatists, are politically motivated. Many criminal organizations rely on fear or terror to achieve their goals or aims as well as to maintain control within the organization and may adopt tactics commonly used by authoritarian regimes to maintain power. Some forms of organized crime simply exist to cater towards demand of illegal goods in a state or to facilitate trade of goods and services that may have been banned by a state. Sometimes, criminal organizations force people to do business with them, such as when a gang extorts protection money from shopkeepers. Street gangs may often be deemed organized crime groups or, under stricter definitions of organized crime, may become disciplined enough to be considered organized. A criminal organization can also be referred to as an outfit, a gang, crime family, mafia, mob, (crime) ring, or syndicate; the network, subculture, and community of criminals involved in organized crime may be referred to as the underworld or gangland. Sociologists sometimes specifically distinguish a "mafia" as a type of organized crime group that specializes in the supply of extra-legal protection and quasi-law enforcement. Academic studies of the original "Mafia", the Italian Mafia, which predates the other groups, generated an economic study of organized crime groups and exerted great influence on studies of the Russian mafia, the Chinese triads, the Hong Kong triads, and the Japanese yakuza.

<span class="mw-page-title-main">Smuggling</span> Illegal movement of goods or people

Smuggling is the illegal transportation of objects, substances, information or people, such as out of a house or buildings, into a prison, or across an international border, in violation of applicable laws or other regulations. More broadly, social scientists define smuggling as the purposeful movement across a border in contravention to the relevant legal frameworks.

<span class="mw-page-title-main">Illegal drug trade</span> Global black market

The illegal drug trade or drug trafficking is a global black market dedicated to the cultivation, manufacture, distribution and sale of prohibited drugs. Most jurisdictions prohibit trade, except under license, of many types of drugs through the use of drug prohibition laws. The think tank Global Financial Integrity's Transnational Crime and the Developing World report estimates the size of the global illicit drug market between US$426 and US$652 billion in 2014 alone. With a world GDP of US$78 trillion in the same year, the illegal drug trade may be estimated as nearly 1% of total global trade. Consumption of illegal drugs is widespread globally, and it remains very difficult for local authorities to reduce the rates of drug consumption.

<span class="mw-page-title-main">United Nations Office on Drugs and Crime</span> Intergovernmental organization

The United Nations Office on Drugs and Crime is a United Nations office that was established in 1997 as the Office for Drug Control and Crime Prevention by combining the United Nations International Drug Control Program (UNDCP) and the Crime Prevention and Criminal Justice Division in the United Nations Office at Vienna, adopting the current name in 2002.

<span class="mw-page-title-main">Antonio Maria Costa</span>

Antonio Maria Costa is an Italian economist. He lives in Vienna and Brussels.

<span class="mw-page-title-main">Transnational organized crime</span> Organized crime across national borders

Transnational organized crime (TOC) is organized crime coordinated across national borders, involving groups or markets of individuals working in more than one country to plan and execute illegal business ventures. In order to achieve their goals, these criminal groups use systematic violence and corruption. Common transnational organized crimes include conveying drugs, conveying arms, trafficking for sex, toxic waste disposal, materials theft and poaching.

<span class="mw-page-title-main">Crime in Afghanistan</span>

Crime in Afghanistan is present in various forms, and includes the following: corruption, contract killings or assassinations, bombings, kidnapping, drug trafficking, money laundering, black marketeering, and ordinary crimes such as theft and assault.

<span class="mw-page-title-main">Wildlife smuggling</span> Illegal gathering, transport and distribution of wild animals

Wildlife smuggling or wildlife trafficking concerns the illegal gathering and trade of endangered species and protected wildlife, including plants and byproducts or products utilizing a species. Research on wildlife smuggling has increased, however, knowledge of the illicit trade remains limited. The differences between international policies and tendencies likely contribute to the extensive estimated range of wildlife smuggling, anywhere from $5-$23 billion, with an additional $67-$193 billion when timber and fish are included. The prolific growth of wildlife smuggling makes it the fourth-largest criminal enterprise globally after drug, firearm, and human trafficking. Products demanded by the trade include but are not limited to ivory, bushmeat, traditional medicine, and exotic pets. China and the United States are the largest buyers in the illegal wildlife trade. It often involves other illegal activities such as tranquilizing animals without proper authorization.

The ASEAN Wildlife Enforcement Network (ASEAN-WEN) was officially launched on 1 December 2005, as a regional inter-agency and inter-governmental initiative to counter the illegal cross-border trade in endangered flora and fauna. It helps countries share information on and tackle cross-border wildlife crime and facilitates the exchange of regional best practices in combating those crimes. As the world's largest wildlife law enforcement network, it comprises the law enforcement agencies of the 10 ASEAN countries forming a regional intergovernmental law-enforcement network.

The Secretariat for Multidimensional Security of the Organization of American States is a part of the General Secretariat, which is headquartered in Washington, D.C., United States. The Secretariat for Multidimensional Security has a mandate to promote cooperation between Organization's Member States, Inter-American and international organizations, as well as with entities such as the United Nations and its subsidiaries, in order to analyze, prevent, confront and respond to security threats.

<span class="mw-page-title-main">Illicit cigarette trade</span> Trade in tobacco goods which fail to comply with legislation

The illicit cigarette trade is defined as "the production, import, export, purchase, sale, or possession of tobacco goods which fail to comply with legislation". Illicit cigarette trade activities fall under 3 categories:

  1. Contraband: cigarettes smuggled from abroad without domestic duty paid;
  2. Counterfeit: cigarettes manufactured without authorization of the rightful owners, with intent to deceive consumers and to avoid paying duty;
  3. Illicit whites: brands manufactured legitimately in one country, but smuggled and sold in another without duties being paid.

In the late 1950s and early 1960s, the drug trade in West Africa rapidly expanded amid dramatic increases in US and European demand for cocaine, cannabis, and other drugs. This resulted in the expansion of two distinct trade routes, both of which went through West Africa. One route exported domestically produced cannabis from West Africa to South Africa, Europe, and Asia. The other trade route moved cocaine from Latin America and heroin from Afghanistan and Southeast Asia to Europe and the United States. In both of these routes, drug traffickers took advantage of trading networks created by Malian and Berber traders in colonial times to move drugs through the region, as well as West Africa's broader geographical location as an intermediate stop from Latin America and Southwest Asia to Europe and the United States. This was due in part to West Africa's badly policed borders, endemic corruption, and economic inequalities.

East African drug trade refers to the sale and trafficking of illegal drugs that take place in East African countries like Kenya, Tanzania, Uganda, Somalia, and Ethiopia. The most prevalent types of drugs traded in East Africa are heroin, marijuana, cocaine, methamphetamine, and khat, all of which are strictly prohibited in East African countries.

The illegal drug trade in Japan is the illegal production, transport, sale, and use of prohibited drugs in Japan. The drug trade is influenced by various factors, including history, economic conditions, and cultural norms. While methamphetamine is historically the most widely trafficked illegal drug in post-World War II Japan, marijuana, cocaine, and other prohibited substances are also present. Additionally, Japan's status as a developed economy and the presence of organized crime in Japan have made it a target of the international drug trade.

Maritime drug trafficking in Latin America is the primary mean of transportation of illegal drugs produced in this region to global consumer markets. Cocaine is the primary illegal drug smuggled through maritime routes because all of its cultivation and production is settled in the Andean region of South America.

Transshipment or transhipment at sea is done by transferring goods such as cargo, personnel, and equipment from one ship to another. It is a common practice in global fisheries and typically takes place between smaller fishing vessels and large specialized refrigerated transport vessels, also referred to as “reefers” that onload catch and deliver supplies if necessary.

Maritime cocaine smuggling refers to the practice which involves the smuggling of cocaine between borders via maritime means. According to the United Nations Office on Drugs and Crime (UNODC), there are an estimated 18 million users of cocaine globally. Approximately 70-80% of cocaine is at some point smuggled across the ocean, originating from South America. Cocaine remains the "highest value criminal commodity for transnational organised crime", motivating the criminal organisations responsible for maritime smuggling practices. Maritime cocaine smuggling is therefore an ongoing international issue, as criminal organisations are finding new and innovative ways of smuggling cocaine and go undetected by authorities.

<span class="mw-page-title-main">Global Initiative Against Transnational Organized Crime</span>

The Global Initiative Against Transnational Organized Crime, sometimes shortened as Global Initiative, is an international non-governmental organization headquartered in Geneva. The organisation is composed of a network of law enforcement, governance and development practitioners, who share the objective of developing innovative strategies and responses to organized crime. In July 2020, the network counted 500 experts.

Seychelles is a small island nation with a vast maritime territory, consisting of 115 islands and a 137 million square kilometer Exclusive Economic Zone. The prevalence of drugs in the country is high and the country is experiencing a heroin epidemic, with an equivalent to 10% of the working force using heroin in 2019. Due to its location along a major trafficking route, drugs can easily be trafficked by sea to Seychelles.

Smuggling in Pakistan is a significant problem, and it has an impact on the country's economy. The illicit trade of various goods across Pakistan's borders with Iran and Afghanistan remains a persistent issue. Smuggled products have infiltrated multiple sectors of Pakistan's economy, spanning items such as cell phones, fuel, and everyday necessities like toiletries and tea. This illicit activity poses challenges to the formal economy and governmental efforts to regulate trade.

References

  1. ↑ OECD (2016-04-18). Illicit Trade: Converging Criminal Networks. OECD Reviews of Risk Management Policies. OECD. doi:10.1787/9789264251847-en. ISBN   978-92-64-25183-0.
  2. ↑ Naím, Moisés. (2006). Illicit : how smugglers, traffickers, and copycats are hijacking the global economy (1st Anchor books ed.). New York: Anchor Books. ISBN   978-1-4000-7884-4. OCLC   72687695.
  3. ↑ Radisch, Jack. "Illicit Trade in the 21st Century". BRINK – News and Insights on Global Risk. Retrieved 2020-08-01.
  4. ↑ "State of the Illicit Economy: Briefing Papers". World Economic Forum. Retrieved 2020-08-01.
  5. 1 2 "Illicit trade endangers the environment, the law and the SDGs. We need a global response". World Economic Forum. Retrieved 2020-08-01.
  6. ↑ "Charting Illicit Trade: Sharing Data and Information - OECD". www.oecd.org. Retrieved 2020-08-01.
  7. ↑ "Illicit trade - OECD". OECD. Retrieved 2020-07-01.
  8. ↑ "World Customs Organization". www.wcoomd.org. Retrieved 2020-07-31.
  9. ↑ "First WCO Illicit Trade Report | Customs Clearance". www.customsclearance.net. Retrieved 2020-08-01.
  10. ↑ "UNCTAD Illicit Trade Forum".
  11. ↑ "The world trade system must arm itself to fight illicit trade". Global Initiative. 2014-09-30. Retrieved 2020-08-01.
  12. ↑ "Illicit Trade and the World Trade Organization: Raising awareness, identifying limitations and building strategies". website. 15 June 2017. Retrieved 2020-07-01.
  13. ↑ "International Crime a $650 Billion Business Built on Poverty and Corruption in Developing World « Global Financial Integrity". Global Financial Integrity. Retrieved 2020-08-01.
  14. ↑ "New UNODC campaign: transnational organized crime is a US$870 billion a year business". United Nations : Office on Drugs and Crime. Retrieved 2020-08-01.
  15. ↑ "The Illicit Trade Environment Index". illicittradeindex.eiu.com. Retrieved 2020-08-01.
  16. ↑ Wechsler, William; Naím, Moisés (2006). "Illicit: How Smugglers, Traffickers, and Copycats Are Hijacking the Global Economy". Foreign Affairs. 85 (3): 156. doi:10.2307/20031987. JSTOR   20031987.
  17. ↑ Deviant Globalization: Black Market Economy in the 21st Century. Bloomsbury Academic. 2011. doi:10.5040/9781501300936. ISBN   978-1-4411-9312-4.
  18. ↑ Andreas, Peter (2017-07-05), "Illicit Globalization: Myths, Misconceptions, and Historical Lessons", Transnational Organized Crime, Routledge, pp. 575–598, doi:10.4324/9781315084565-33, ISBN   978-1-315-08456-5
  19. ↑ Naylor, R. T. (2002). Wages of Crime: Black Markets, Illegal Finance, and the Underworld Economy. McGill-Queen's University Press. ISBN   978-0-7735-2417-0. JSTOR   j.ctt130hb7k.
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