Illicit trade in contraband goods placed at $650 billion

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Infographic about the digital coding for tracking and tracing European pharmaceuticals.

Illicit trade affects us all. It is a problem of international scale and scope. Recent estimates by Global Financial Integrity (GFI), a US-based NGO, place the total retail value at USD 650bn for goods – and a whopping USD 2tn if associated financial flows are included, the Coalition against Illicit Trade said in Brussels. See report here.

According to Business Action to Stop Counterfeiting and Piracy (BASCAP) initiative of the International Chamber of Commerce (IOC), “the massive infiltration of counterfeit and pirated goods drains USD 1tn from the global economy and destroys over 2.5 million jobs. Unsafe and ineffective products pose a risk to millions of consumers, while governments, businesses and society are being robbed of hundreds of billions in tax revenues, income and jobs.”

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Infographic about the international issue of illlicit trade in tobacco products.

It said: “Even products like cosmetics are targets for the criminals. The result of a pilot study focusing on the cosmetics sector undertaken by the EU’s Office for Harmonisation in the Internal Market (OHIM), found the legitimate industry loses approximately EUR 4.7bn of revenue annually from counterfeit cosmetics. Adding in the effects on other industries and on government revenue, counterfeiting in this sector alone cause EUR 9.5bn of lost sales annually, leading to about 80,000 lost jobs, and EUR 1.7bn in lost government revenues.”

The Coalition Against Illicit trade added: “The illicit alcohol trade is also substantial, with the World Health Organisation estimating that around 30% of all alcohol consumed globally is produced illegally, or is “unrecorded.” According to Interpol, the illicit trade in cigarettes is the biggest illegal trade in a legal product in value terms, second only to illegal drugs in terms of revenue generated by smugglers3. Around 12% of the global cigarette market is estimated to be illicit. That is equivalent to some 660 billion cigarettes every year – costing governments more than USD 40bn in lost tax revenues every year.” – Courtesy: CAIT

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