Human Mobility and Exploitation
There are more than 240 million international migrants in the world, equivalent to about 3.3% of the global population, and the total number of displaced people is the highest on record, according to the International Organization for Migration’s World Migration Report 2018. Criminal enterprises are wreaking havoc on vulnerable people.
According to a report published by Europol, in 2015 alone smugglers transporting people to and from Europe created an industry that was worth more than €6 billion and employed more than 40,000 workers. While smugglers have become an important lifeline for people caught up in conflict or chronic poverty, they have also become a potent source of violence, insecurity, and brutal exploitation.
This spike has been driven by efforts to find refuge or seek out economic opportunities. However, concerns about integrating migrants and security have ensured that legitimate opportunities for the displaced fail to match demand. As a result, a massive number of people are being exploited by an unscrupulous and exploitative system that profits from human trafficking and illicit labor.
Human trafficking is a universal problem; it occurs everywhere and can take many forms. On any given day in 2016, 40 million people were victims to modern slavery, including 25 million people in forced labor and 15 million people in forced marriages, according to a report published in 2017 by the International Labor Organization (ILO).
A report published in 2014 by the United Nations Office on Drugs and Crime estimated that more than 2 billion people were still not benefitting from protections included in the United Nations Trafficking in Persons Protocol - which had entered into force in 2003.
Women and girls account for 71% of modern slavery victims, according to the report. This impacts both public well-being and private sector operations; the ILO report noted that the manufacturing sector, which accounted for 15% of forced labor exploitation cases, includes a medical gloves industry that is worth more than $5 billion annually and largely relies on migrant workers at outsourced factories in Asia. Documented concerns at many of these factories included excessive working hours and the illegal retention of passports, according to the report. While related legal provisions and protections exist, they are insufficient.
Public-private partnerships are essential for addressing human rights abuses, and the private sector can play a particularly important role by fostering healthy debate about the global mobility of labor.
Cybercrime
An increasingly connected world brings with it unprecedented cyber challenges, potentially impacting just about every type of digital operation, undermining financial stability and security, and robbing us of our privacy. The nature of ransomware attacks has shifted from annoyance to the disruption of key infrastructure.
The annual cost of cybercrime will likely increase by 15% every year until it hits $10.5 trillion in 2025, according to one estimate. News stories about data breaches, ransomware, and malware attacks are a seemingly daily occurrence, and the criminal compromise of the digital devices and networks we now depend upon severely diminishes their reliability - and the trust we place in them.
Everyone and every organization is a potential cybercrime victim; as people and businesses demand greater efficiency and productivity through internet-connected devices, what is collected for analysis can be targeted by cybercriminals - for leverage, to inflict damage, or to steal money (indeed, just as Willie Sutton once robbed banks because “that’s where the money is,” the digital world now fills that role). In the wake of COVID-19, many people have only increased their online presence for remote work purposes or entertainment, creating even bigger targets for criminal activity.
As a growing universe of connected Internet of Things devices has increased the number of available digital targets for would-be attackers, it has also amplified the ability to inflict harm more broadly and deeply. Gartner has estimated that there are now some two billion IoT devices in operation, and high-profile examples of damage inflicted through these targets include the Mirai botnet - which compromised more than 600,000 of them, including cameras, routers, and network storage devices (it then leveraged its control of the devices to launch distributed denial-of-service attacks on a variety of organizations).
Cybercrime is clearly not going away anytime soon, and people and businesses should prepare for how to best deal with it. Researchers at Verizon have found that nearly a third of all malware now being discovered is ransomware; the nature of attacks has meanwhile shifted from pervasive annoyance to the significant disruption of key infrastructure. This was underscored by the Colonial Pipeline and JBS Foods ransomware incidents in 2021 - both organizations capitulated to attackers and paid out millions of dollars (though much of what Colonial Pipeline paid was later recovered).
ILLICIT ECONOMY
Illicit trade in people, goods, drugs, money, intellectual property and natural resources has made criminal networks into multi-billion-dollar syndicates - undermining legitimate companies, the integrity of governments, and public security. Organized crime may prevent the achievement of nearly one-quarter of the United Nations' Sustainable Development Goals, according to the Global Initiative against Transnational Organized Crime.
Through the Global Initiative against the Transnational Organized Crime Report - illicit
economies and armed conflict we explore the dynamics that promote instability.
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Corruption and Impunity
Organized crime and illicit economies are increasingly prominent sources of political corruption, as criminal networks pour money into parties and forge alliances with officials and their intermediaries. When illicit trade is allowed to flourish, it spawns a culture of impunity. A lack of law enforcement, penalties, or any deterring government presence at all runs the risk of increasing complicity over time.
Transnational organized crime generates an estimated $870 billion in annual revenue, and about one-third of organized crime groups surveyed by the United Nations have political influence at the local level, according to a report published in 2016 by the Global Initiative against Transnational Organized Crime. Transactional corruption of law enforcement and public officials diverts resources from the state, and increasingly, in countries with poor institutions, the receipt of a bribe is perceived as a right of office - while payment of a bribe is seen as a cost of doing business. This has generated distrust in politicians, distorted markets, undermined public infrastructure, and disengaged citizens. During the 2014 regional elections in Peru, for example, the Ministry of the Interior announced that 124 candidates had links to drug traffickers - yet, 14% of those candidates were ultimately elected, according to the Global Initiative against Transnational Organized Crime’s 2016 report.
Crime and corruption are further facilitated by the decline of the stigma associated with illegal acts; illicit activity is regularly used to gain political power or to buy legitimacy with the public. In Afghanistan, for example, the lack of a state presence is thought to be the most important contributing factor to the rampant opium production in the southwestern provinces of Helmand, Kandahar, Nimruz, and Farah, according to the Global Initiative against Transnational Organized Crime’s report.
The high-level business and government officials who enable criminal behavior through neglect or complicity are exacting heavy costs on the rest of us; the annual cost of corruption in the form of bribery and theft amounts to about $3.6 trillion, according to a UN estimate published in 2018. In many areas of Afghanistan, the Taliban has taken advantage of the lack of state security to become the security provider itself, and its drug-related income - from both smuggling and protecting fields from police scrutiny - has been estimated to be as much as $155 million annually, according to the report.
Crime and the Environment
The criminal diversion of natural resources undermines security, biodiversity, and social stability. Land grabbing, illegal logging and mining, and accessing restricted water sources all have serious consequences for human rights, economic growth, and social development. Even so-called “petty” corruption can lead to disastrous consequences for natural resource use - for example, according to a report published by the Water Integrity Network in 2016, the Nairobi City Water and Sewage Company in Kenya were losing 40% of its supply to theft and leaks, while poor residents were being forced to buy water privately that was as much as 25 times more expensive.
Oxfam estimates an area of land equivalent in size to Portugal has been sold off to foreign investors over the past decade, with some of those deals involving land grabs. However, Oxfam has noted some positive recent commitments from the private sector, including pledges from Coca-Cola, PepsiCo, and Nestle to respect the land rights of indigenous communities and eliminate land grabs from their supply chains. Environmental crime is an increasingly rewarding activity; in the past decade, it has escalated in terms of variety, volume, and value. Illegal land grabbing can meanwhile lead to forced displacement and other serious consequences.
The biodiversity of a number of critical ecosystems is at risk. Illegal fishing is one of the most neglected areas of environmental crime; illegal, unreported, and unregulated fishing costs the global economy as much as $23.5 billion annually, according to data cited in a report published by the Organization for Economic Co-operation and Development in 2018.
The United Nations Office on Drugs and Crime noted in a 2017 report that efforts by the international community to curb the illegal wildlife trade seemed to be having a positive effect - it recorded a decline in the number of rhinos poached in South Africa, and elephant poaching levels that were significantly lower than their peak in 2011. However, concerns raised in the report included a high volume of seizures of scales culled from African pangolins; while legal trade in the small mammals has virtually disappeared, the equivalent of 200,000 live pangolins were seized illegally between 1999 and 2016, and 2017 was pace to mark a new high, according to the report (in early 2019, officials in Hong Kong recorded their biggest-ever seizure of pangolin scales, weighing in at 8.2 tones). Illegal trade in natural resources can also exacerbate income inequality, and fund organized crime.
Violence and Instability
According to the United Nations Office on Drugs and Crime’s Global Study on Homicide published in 2018, organized crime is a leading cause of homicidal violence in some countries in the Americas - which has the highest homicide rate of any region in the world. Rampant organized crime is spawning violence and stirring broader instability.
Conflict and insecurity are major barriers to development; a World Bank World Development Report published in 2011 noted that countries that had experienced relatively high levels of violence between 1980 and 2000 also suffered from an average poverty rate that was 21% higher than in countries with low levels of violence during the same period.
Rising levels of criminal activity in some countries and within certain political systems have given rise to armed violence, destabilized governments, and fuelled armed terrorist groups. In Mexico, for example, there were 33,341 murders in 2018, a 7% increase compared with the prior year that was partly a result of the fragmentation of large cartels and the government’s inability to react to smaller gangs killing for greater control of territory, according to the foundation InSight Crime.
Stark inequality and a lack of both educational opportunities and jobs have bred a sense of frustration and rage in Nyanga, according to a researcher at the University of Cape Town cited in a 2018 Bloomberg News report.
In failed and failing states, fights over access to natural resources like minerals and oil has exacerbated the conflict. Meanwhile, in conflict zones in the Sahel region and Libya, illicit trafficking in drugs and the smuggling of migrants have served as a means to fund insurgencies.
Rapid urbanization and glaring income inequality (particularly in the southern hemisphere) have fostered slums beset by crime, violence, and a general lack of security. Cape Town is a prime example. Nyanga, a Cape Town slum, had the highest murder rate in the country as of 2018, according to the South African Government News Agency; the 308 murders reported there during the year ended in March 2018 marked a 9.6% increase compared with the prior period.
The failure of internationally-sponsored peace and transition processes to address illicit flows and provide a clear distinction between criminal activity and groups that have legitimate grievances, or to protect state institutions from the corrupting influence of the illicit economy, are recognized reasons for the resurgence of conflict and state failure.
Illicit Trade and Financial Flows
The financial flows generated by illicit trade appear to be growing. A working paper published by the International Monetary Fund in 2018 presented data on 158 countries showing that the average size of their shadow economy relative to GDP between 1991 and 2015 was 31.9% (the largest was Bolivia, at 62.3%, and the smallest was Switzerland, at 7.2%). The revenues generated by transnational crime are estimated to be worth as much as $2.2 trillion annually, according to a report published in 2017 by the think tank Global Financial Integrity. The global shadow economy is believed to be worth more than the GDP of most countries.
Illicit trade can involve legal goods that have nonetheless violated regulations during transit - based on how they were sourced or produced, or through theft, diversion, or misrepresentation.
According to the report, counterfeiting brings in as much as $1.1 trillion annually, drug trafficking earns as much as $652 billion, and organ trafficking earns as much as $1.7 billion. Frontier Economics, a research firm, has estimated that the value of digitally-pirated films may reach $622 billion in 2022, up from $160 billion in 2013, while the value of digitally-pirated music may grow to $117 billion from $29 billion over the same period.
The negative effects of illicit trade are far-reaching and dramatic. An estimated one in 10 medical products circulating in low- and middle-income countries is either sub-standard or falsified, according to a report published in 2017 by the World Health Organization. As many as 169,000 children may be dying every year from pneumonia due to sub-standard and falsified antibiotics, according to the report, while in sub-Saharan Africa, sub-standard and falsified antimalarials are responsible for as many as 158,000 deaths and $38.5 million in unnecessary health care costs annually.
Companies, governments, and non-governmental organizations are all demonstrating an increased awareness of this problem and are cooperating to address it - though successful partnership models have yet to emerge. Through the World Trade Organization's Bali Package, passed in 2013, governments have affirmed their commitments to a secure trade facilitation agenda, and both the G20 and the B20 (a summit of business leaders from G20 countries) have highlighted a need to address illicit trade issues.
