Illicit trade is bigger than all but seven of world’s economies

7 August 2019

Teresa Moreira, head of competition and consumer policies at United Nations Conference on Trade and Development (UNCTAD) told a recent conference that, if illicit trade were an economy, it would be the eighth largest in the world.

Addressing a forum organised by UNCTAD and the Transnational Alliance to Combat Illicit Trade (TRACIT), she argued that illicit trade poses a threat to the achievement of global goals and requires concerted international action.

From smuggling, counterfeiting and tax evasion, to the trafficking of humans and wildlife, such trade is, she went on, holding back progress, increasing costs and pushing Sustainable Development Goals (SDGs) further away.

What Ms Moreira described as “economic leakages from illicit trade” create an estimated annual drain of US$2.2 trillion, nearly 3% of world economy.

TRACIT’s director-general Jeffrey Hardy highlighted the impacts of illicit trade in various countries – from illegal fishing affecting marine resources in Costa Rica to counterfeiting draining $93 billion from the EU’s gross domestic product (GDP) as well as 790,000 jobs.

Illicit trade in pharmaceuticals is valued at between $75 billion and $200 billion annually, while wildlife crimes are worth $23 billion, according to TRACIT.

More details can be found in a report on illicit trade, presented by TRACIT, which can be found at unctad.org.

Mr Hardy said most forms of illicit trade also plunder natural resources, abuse supply chains and ultimately expose consumers to fake and potentially harmful products, affecting related goals.

“It’s not a problem confined to developing countries,” Ms Moreira said. “Every country suffers from this menace, all that varies is the magnitude of the problem.”