Analyses
The Pandemic Has Triggered Dramatic Shifts in the Global Criminal Underworld
By Robert Muggah, FPI, May 8, 2020
May 9, 2020 - 12:03:10 PM

Drug cartels are facing broken supply chains, shrinking revenues, and shifting markets. Rising violence is just one effect.

To say that COVID-19 changes everything is already a cliché. But it’s also true. The pandemic is deepening tension between China and the United States, accelerating the digitalization of commerce, and shining a bright light on the inequalities that divide our societies. It is also triggering dramatic knock-on effects in the criminal underworld. After a temporary lull in homicidal violence in some countries, there are signs that it is rising once more. Meanwhile, crime groups are migrating online to where the action is. If left to their own devices, they could make the world a more dangerous place.Police shortages and market shocks are triggering fresh waves of violence in Brazil, Colombia, and Mexico, where criminal groups are fighting over a diminishing pie.

Many countries actually witnessed declines in some types of crime and increases in others shortly after the imposition of social distancing and lockdowns to slow the virus. In much of North America and Western Europe, for example, murder and violent assault plummeted as people stayed at home. On the other hand, reported domestic abuse and sexual violence exploded. Predictably, the confinement of people to their homes increased exposure to abusive partners.

Some of the world’s most violent nations recorded dramatic drops in violent crime. U.S. cities such as Chicago, Los Angeles, and New York experienced stunning declines in robbery and rape. El Salvador, routinely ranked among the most dangerous countries, saw homicides drop from 114 in February to 65 in March. South Africa, the continent’s crime capital, registered just 94 homicides in the first few weeks of lockdown, compared with 326 during the same period the year before.

Although welcome, these improvements in safety could be fleeting. Physical distancing, curfews, and shelter-in-place orders are not deterring drug cartels, gangs, and militias. To the contrary, a combination of police shortages and supply and demand shocks in the drug market are triggering fresh waves of violence, especially in Brazil, Colombia, and Mexico, where criminal groups are fighting over a diminishing pie. The deterioration in security also appears to be compounded by the early release of inmates from the region’s notoriously violent prisons—some of whom are already settling old scores.

Brazil’s three-year decline in homicide has come to screeching halt. In São Paulo, home to one of Latin America’s most powerful drug trafficking organizations, murders were up 10 percent between March 2019 and March 2020. And in the northern state of Ceará, violent crimes (including homicide) spiked by 98 percent in just 10 days in March. Levels of reported domestic violence have also surged in most states, including by more than 50 percent in Rio de Janeiro alone.

Mexico also witnessed a dramatic escalation in lethal violence, especially in states like Chihuahua, Michoacán, and especially Guanajuato, which are dominated by drug cartels. The authorities registered more than 2,500 homicides nationwide in March, the highest monthly toll since records started being kept in 1997. With the armed forces and police distracted with pandemic control measures, Mexico’s more than 200 criminal groups are fighting over control of drug routes and industrial-scale syphoning of gasoline.Crime groups, not police, are enforcing lockdown orders in informal settlements and slums.

Even El Salvador’s remarkable crime decline was shattered by a sharp increase in gang violence over the past weeks. After dozens of people were slaughtered over a single weekend in late April, the president ramped up arrests and authorized lethal force to stem the bloodshed. These iron-fisted measures could make a bad situation worse: Gangs already control the country’s jails, and the mixing of rival factions is a recipe for disaster.

Across these and other countries, crime groups, not police, are enforcing lockdown orders in informal settlements and slums. Criminal factions, militias, and mafia groups are also conveniently reinforcing their soft power in the process. Some are providing basic services and delivering toilet paper, canned goods, and perishable food items to the poor, infirm, and older adults. Others are posting warnings online and off about abiding by curfews and social isolation. Their appeal may be growing at a time when government leadership is lacking.

The surge in drug-related violence partly comes down to changes underway in global markets. The slowdown in international trade means that cartels and gangs have fewer opportunities to move their illegal merchandise through global supply chains, whether by land, air, or sea.

The slowdown in international trade means that cartels and gangs have fewer opportunities to move their illegal merchandise through global supply chains, whether by land, air, or sea.

Meanwhile, drug producers in Bolivia, Colombia, Peru, and Mexico are struggling to source precursor chemicals to make methamphetamines, fentanyl, and even cocaine. The lockdown of Chinese factories is not only impacting the export and sale of iPhones but also of counterfeit goods.

The global economic crunch is triggering supply and demand shocks for the narcotics business as a whole. Anticipating a slowdown in international trade due to the pandemic, some Latin American traffickers ramped up shipments in recent months. European law enforcement officials reported a surge in cocaine imports in March and April with sizable seizures in Antwerp, Belgium, one of the continent’s busiest ports. And despite the shuttering of many international airports, satellites have tracked a steady stream of planes landing and taking off from Guinea-Bissau, suggesting that its role as a known transit hub for cocaine persists.

There are signs that users themselves are substituting in alternatives once their drug of choice becomes harder to source. Growing numbers of Europeans are reportedly shifting from foreign-manufactured cocaine to homegrown marijuana. Others are hoarding drugs, which means increased prices. As a result, some heroin users are shifting to more potent and dangerous opiates such as fentanyl. Across the region, COVID-19 is also accelerating the purchase of drugs online, including via the so-called dark web.

In southern Italy, an already shaky economy is left struggling by the coronavirus—leaving a vacuum for organized crime.

The disruptions to global drug markets may be temporary, but they could have longer-term effects on crime. With their liquidity drying up, gangs will increasingly target banks, shops, and residences to generate revenue. In Latin America and other parts of the world, crime groups will resort to old-fashioned kidnapping, extortion, and protection rackets to keep the cash flowing. People-smuggling will suffer a downturn due to the tightening of borders, putting trafficked victims at greater risk. Meanwhile, many crime syndicates will branch into more lucrative businesses—especially cybercrime such as ransomware, phishing, and identity theft, which has seen a sharp rise as the world goes increasingly digital.Drug producers are struggling to source precursor chemicals to make methamphetamines, fentanyl, and even cocaine.

The COVID-19 pandemic is also shaking up other forms of organized crime. The trade of endangered wildlife is one example. China banned the trade in wildlife early into the pandemic. But this may mean such activity moves elsewhere, with reports emerging of Vietnamese traders in Hanoi marketing tiger bone glue and rhino horn as cures for COVID-19. Meanwhile, Mexico’s Jalisco New Generation cartel is reportedly already one of the top vendors of stolen and pirated pharmaceutical products. They are part of a thriving global black market for counterfeit or stolen medicine and personal protective equipment.

Far from view, COVID-19 has given rise to a transformation in organized crime. In addition to fueling rising violence, the pandemic could enhance the social, economic, and political clout of some criminal organizations in the same way that the Italian mafia and Japanese yakuza emerged stronger after the great dislocations of World War II. Crime bosses know full well that law enforcement and criminal justice systems are overstretched and that prisons are bursting at the seams in Latin America and elsewhere. They also know great scarcity is coming, which may increase the risk of violence. The question is whether we are even remotely ready.