International criminal markets have become major centres of power, UNODC report shows

Photo: UNODC17 June 2010 - A report released today by UNODC shows how organized crime has globalized and turned into one of the world's foremost economic and armed powers.

The Globalization of Crime: A Transnational Organized Crime Threat Assessment, released at the Council of Foreign Relations in New York, looks at major trafficking flows of drugs (cocaine and heroin), firearms, counterfeit products, stolen natural resources and people (for sex and forced labour), as well as  smuggled migrants. It also covers maritime piracy and cybercrime.

"Today, the criminal market spans the planet: illicit goods are sourced from one continent, trafficked across another and marketed in a third," said UNDOC  Executive Director Antonio Maria Costa. "Transnational crime has become a threat to peace and development, even to the sovereignty of nations," warned the head of UNODC. "Criminals use weapons and violence, but also money and bribes to buy elections, politicians and power - even the military," said Mr. Costa. The threat to governance and stability is analysed in a chapter on regions under stress.

Among the findings in the new report, which features a number of high-impact maps and charts that illustrate illicit flows and their markets are: Europe is the highest-value regional heroin market (US$ 20 billion), while the Russian Federation is now the single largest national heroin consumer in the world (70 tons). Countries that grow most of the world's illicit drugs, like Afghanistan (opium) and Colombia (coca), receive the most attention and criticism. Yet, most drug-related profits are made in the destination (rich) countries. For example, out of a global market of perhaps US$ 55 billion for Afghan heroin, only about 5 per cent (US$ 2.3 billion) goes to Afghan farmers, traders and insurgents. The report shows that the North American cocaine market is shrinking because of lower demand and greater law enforcement, which in turn has generated a turf war among trafficking gangs, particularly in Mexico, and new drug routes.

Regarding human trafficking and the smuggling of migrants, the report shows that an estimated 140,000 people become victims of trafficking for purposes of sexual exploitation in Europe alone, generating a gross annual income of US$ 3 billion for their exploiters. The two most prominent flows for smuggling migrants are from Africa to Europe and from Latin America to the United States. Between 2.5 million and 3 million migrants are smuggled from Latin America to the United States every year, generating US$ 6.6 billion for smugglers.

The number of counterfeit goods detected at the European border has gone up by a factor of 10 over the past decade, for a yearly value of more than US$ 10 billion. As much as half of medications tested in Africa and South-East Asia are counterfeited and substandard, increasing, rather than reducing the chance of illness.

The report shows how illegal exploitation of natural resources and the trafficking in wildlife from Africa and South-East Asia are disrupting fragile ecosystems and driving species to extinction. UNODC estimates that illicit wood products imported from Asia to the European Union and China were worth some US$ 2.5 billion in 2009. Regarding cybercrime, the report reveals that more than 1.5 million people a year suffer the theft of their identity for an economic loss estimated at US$ 1billion, and that  cybercrime is endangering the security of nations: power grids, air traffic and nuclear installations have been penetrated.

Work on the report was initiated following concerns expressed by United Nations countries, the Security Council, the Group of 8, and other international organizations about the threat posed by transnational organized crime, and the need to counteract it. Producing the report was a challenge due to the fact that evidence on the subject has thus far been limited and uneven. "Despite the intrinsic difficulty of doing research on crime, UNODC was able to document the enormous power and global reach of international mafias," said Mr. Costa.

The report makes a number of suggestions on how to deal with the threats posed by the globalization of crime, including "disrupting the market forces" behind these illicit trades and global responses on the basis of the United Nations Convention against Transnational Organized Crime (also known as the Palermo Convention), which was adopted in 2000.

"Crime has internationalized faster than law enforcement and world governance," said Mr. Costa. "The Palermo Convention was created precisely to generate an international response to these transnational threats, but is often neglected," he said. "Governments that are serious about tackling the globalization of crime should spur the nations that are lagging behind in the implementation of the Convention," said the head of UNODC.

"When States fail to deliver public services and security, criminals fill the vacuum," said Mr. Costa. "Reaching the Millennium Development Goals would be an effective antidote to crime, that in itself is an obstacle to development," he added. He also called for greater attention to criminal justice in peacebuilding and peacekeeping operations. "Since crime creates instability, peace is the best way of containing crime," he said.

"Criminals are motivated by profit: so let us go after their money," said Mr. Costa, adding that "We must increase the risks and lower the incentives that enable the bloody hand of organized crime to manipulate the invisible hand of competition". He called for more robust implementation of the United Nations Convention against Corruption, more effective anti-money-laundering measures, and a crackdown on bank secrecy.

Related Information:

The Globalization of Crime: A Transnational Organized Crime Threat Assessment (pdf)

The Globalization of Crime: A Transnational Organized Crime Threat Assessment (Executive Summaries, Press Releases, Chapters)

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