Democratising the drug trade - Jeremy McDermott

The drug trade in Latin America is undergoing a ‘democratisation’. This is not a good thing.

There are no longer only a few mega-cartels controlling the business, and the United States can no longer dictate how the war on drugs is to be fought. The bodies are piling up as criminal groups, from street gangs to transnational criminal organisations, fight for a share of the trade, as drug-fuelled violence spreads across the whole region. Law enforcement and the justice system are struggling to keep up, with impunity levels for homicides as high as 90 per cent.

This ‘democratisation’ has seen an atomisation of the criminal groups that are involved in every link of the drug trade. The fact that most of these links are now often paid in product, rather than cash, has led to an explosion in drug consumption in producer and transit nations alike, while consumption levels in the principal market of the US has stabilised at around 300 tonnes per annum. Latin America has become a victim of US ‘success’. More effective US interdiction and the dismantling of many powerful drug cartels has led criminals to sell drugs at home, creating a new and wholly unpredictable wave of violence, feeding some of the highest murder rates in the world. Corrupt and inefficient police and judiciary are unable to cope. New markets have sprung up. The UK is now a major consumer of cocaine, with an appetite estimated at almost 50 tonnes a year.

'‘If the consumption of drugs cannot be limited, then decision-makers must seek more solutions – including market alternatives – in order to reduce the astronomical earnings of criminal organisations’'
Felipe Calderon
Mexican President

In the 1980s the drug war was fought principally in Colombia and the US, with the Medellin and Cali cartels controlling all the links in the drug chain, from the coca crops right up to cocaine distribution in the US. In the 1990s the Colombians began to pay their Mexican transporters with a percentage of the drug consignments instead of cash, so the latter developed their own structures and distribution networks, while Mexican domestic consumption also began to climb

By 2008 the Mexican cartels, or more formally, Mexican transnational criminal organisations (TCOs), had eclipsed the Colombians, becoming among the most sophisticated and richest criminal syndicates in the world. The Mexicans are now the principal international suppliers of cocaine across the globe. The Mexicans and Colombians often pay their Central American transporter networks with cocaine, repeating the cycle, turning this region into the most dangerous place on Earth, as consumption increases and local criminal gangs make the leap into the big leagues as TCOs.

The pioneer in the cocaine trade was Pablo Escobar of the Medellin cartel. He not only controlled the entire process from drug crops to street distribution, but created the first mega-organisation dedicated to drug trafficking. Many traffickers, not just those operating in his home town of Medellin, were part of the cartel. Escobar would pool shipments from different cartel members and ‘guarantee’ not only delivery to the US, but that each supplier would get paid back in Colombia. Escobar did not allow his cartel members to consume their product (although he was an avid consumer of marijuana, which helped reinforce his natural paranoia). There was no local distribution of cocaine or its derivatives, as all product was exported. This was a model that the Cali cartel replicated on the other side of Colombia and until 1995, these two giant organisations controlled much of the cocaine trade. But with the killing of Escobar on a Medellin rooftop in 1993 and the arrest of the Rodríguez Orejuela brothers in Cali in 1995, the drug trade changed irrevocably. While the Mexican cartels now rival, if not surpass their Colombian predecessors in wealth and ferocity, there are no longer any monolithic and integrated structures that answer to one leader, not even the Sinaloa cartel under the world’s most wanted man, Joaquin Guzman, alias ‘El Chapo’ (‘Shorty’ in English), who is often compared to Escobar. The drug trade is a hydra. Behead the beast, as with the killing of Escobar, and it will spawn new heads immediately.

Fragmenting organised crime
The fragmentation of the Colombian cartels has continued and this trend is being replicated in Mexico. The second generation of drug cartels in Colombia, born in the late 1990s, were federations like that of Norte Del Valle. Many different structures or ‘baby cartels’ sprung up, specialising in different links in the drug chain. Some were responsible for buying coca base in Colombia, Bolivia and Peru. Others set up crystallising laboratories to produce cocaine of 95 per cent purity. Then there were the transporters, by land, sea and air, who moved drug shipments in ever more innovative ways. Distribution in the US became the preserve of local gangs, including Latino street gangs, Crips, Dominicans, Aryan Brotherhood, and so on.

This fragmentation provided law enforcement and the justice system with a new set of challenges. Now they had to build up intelligence and cases against dozens of organisations. The removal of one did little or nothing to impede the flow of drugs, as another group, specialising in the same link in the chain, quickly stepped up to replace it.

The modern face of organised crime can be seen today in Colombia. Apart from the Marxist rebels of the Revolutionary Armed Forces of Colombia (FARC) and their smaller cousins, the National Liberation Army (ELN), there are no hierarchical structures that handle the drug trade. These guerrilla groups, 48 years into their fight to overthrow the state and impose communist regimes, have transformed from armed peasants in remote corners of the country, into heavily armed private armies with international connections, thanks to earnings from cocaine. Today, Colombian organised crime is all about networks with disparate elements, be they rebels, former cartel members, right-wing paramilitaries or new-generation capos, all combining efforts on an ad hoc basis to put together drug shipments and export. Again, the police are scrambling to respond, now having to investigate individuals who form part of ever shifting and mutating criminal networks.

'‘Honduras now has the highest murder rate in the world, at 86 per 100,000 of the population, as Mexican transnational criminal organisations (TCOs) set up shop and support local criminal gangs which are increasing in sophistication’'

In Mexico the same fragmentation is happening, and is the main reason for the constant decapitations and mutilations that form the day-to-day horrors of the fight between Mexican TCOs, for control of the movement corridors and the coveted crossing points into the US. The once-mighty Gulf cartel split after the extradition of its leader in 2007. Its military wing, made up of former Mexican Special Forces, broke away and formed the Zetas, which have easily eclipsed their progenitors to become the fastest expanding and most brutal TCO in Mexico, if not the world. The cult-like La Familia, based in the state of Michoacán, which specialised in methamphetamine production, also fragmented after its leader was killed by security forces in 2010, with various factions – foremost amongst them the so-called ‘Knights Templar’ – fighting for spoils and pushing up murder rates yet further.

Whereas the Medellin and Cali cartels concentrated exclusively on the exportation of cocaine, today’s TCOs now have a much broader criminal portfolio, including extortion, kidnapping and human trafficking, amongst others. This is ensuring that the violence multiplies and spreads. From Colombia it has infected not only bordering nations like Venezuela (now the most violent nation in South America with a murder rate of 50 per 100,000 of the population – as a point of reference the murder rate in the UK is just over one per 100,000), Ecuador (where coca is now being sown) and regional giant Brazil; but nations as far south as Argentina. Argentina has become not only a refuge for fugitive Colombian drug lords, but a huge drug market in its own right as well as an increasingly important transit nation for cocaine shipments.

A rock and a hard place
Central America is finding itself squeezed between Colombian TCOs in the south and Mexican groups in the north. Honduras now has the highest murder rate in the world, at 86 per 100,000 of the population, as Mexican TCOs set up shop and support local criminal gangs which are increasing in sophistication. These tiny Central American nations, barely recovered from the civil wars of the 1980s and early 1990s, do not have the funds to compete with Mexican TCOs, which have economic resources in excess of many of their national defence budgets.

Organised criminal syndicates are the most agile businesses that exist. They mutate in response to changing conditions and are able to react very quickly. When President Manuel Zelaya was removed from power in 2009, almost overnight Honduras became the principal air bridge for cocaine arriving from South America. TCOs immediately took advantage of the political chaos that resulted from the coup to land aircraft with multi-ton cocaine consignments.

However, the judicial systems of Latin American nations have been extremely slow to reform and react to changing conditions. The most responsive has been the Colombian system which, thanks to US funding, has switched from an inquisitorial to a US-style accusatory system, and sought to engage in continuous reforms. While the new system has speeded up prosecution and convictions in the case of those caught red-handed, the prosecution of complicated organised crime, once handled by specialised judges, has become infinitely more complicated. A measure of the chaos of the Colombian justice system can be seen in the case of homicides, where impunity is running at around 90 per cent. Colombia relies heavily on the tool of extradition to handle high-level cases, as its courts are simply incapable of prosecuting and condemning top-level criminals, or preventing them from continuing to run their criminal empires from behind bars. Extradition is also becoming more common from Mexico – which has historically been resistant but is becoming increasingly disposed to having the US justice system take on responsibility for high-level drug cases.

Coalition of the unwilling
It was the US that invented, and led, the war on drugs. However US strategy has not only encountered increasing resistance, but now has huge holes in its front lines, as a number of Latin American nations either refuse to cooperate, or are simply doing their own thing.

1999 marked a key change in the US drug war strategy, with the focus switching from interdiction of drug shipments and the legal fight against TCOs responsible for smuggling tons of cocaine, to attacking the supply side. ‘Plan Colombia’ was born under President Bill Clinton, designed to eradicate drug crops in Colombia, then by far the biggest producer of coca, the raw material for cocaine. So the US financed and trained an elite anti-narcotics brigade in the Colombian army, boosted the anti-narcotics police and engaged in the most ambitious crop-eradication programme ever seen. US funding and contractors loaded up spray planes with glyphosate chemicals and unloaded them on huge tracts of the Amazonian jungle. So far more than $8bn has been delivered via Plan Colombia. An estimated 100,000 hectares of coca were sprayed in Colombia in 2011, with another 35,000 eradicated manually.

‘The war on drugs is no longer the war to prevent drug shipments reaching the US. The war on drugs is now the war against domestic consumption, and each nation knows it has to shoulder that burden alone’

This has simply pushed the coca crops elsewhere. Now Peru is set to dislodge Colombia as the world’s principal coca grower, prompting a renaissance of the Peruvian rebel group, the Shining Path, which was thought to have been destroyed after the arrest of its leader, Abimael Guzman, or ‘Chairman Gonzalo’, in 1992. Bolivia has seen its coca production increasing as well. Even the advances in Colombia are not permanent as the United Nations reports that coca production increased slightly here in 2011, the first such increase in a decade. But the number of hectares under cultivation only tells a fraction of the story. New strains of coca produce far more alkaloid (the active ingredient in cocaine) than ever before, and now coca farmers can harvest up to six crops a year from fields, where once they got three. The same growing conditions exist in Brazil, Ecuador and Venezuela. It will not be long before these nations become coca producers, rather than just transit nations for cocaine shipments.
US arrogance and the system of ‘certifying’ nations depending on their enthusiasm for, and participation in, the war on drugs, have created a political backlash in Latin America. Venezuela, under President Hugo Chávez, first banned US over-flights, and then in 2005 stopped working with the US Drug Enforcement Administration (DEA) altogether. Ecuador, under President Rafael Correa, shut down a US air base it had leased in the north of the country, as well as expelling the US ambassador in 2011. Neighbouring Bolivia expelled the DEA (as well as a US Ambassador) in 2008, creating yet another black hole for the US drug agency. It is no coincidence that these nations are now of key importance to the international cocaine trade.


IBA Human Rights Award winner fights for justice in Medellin

For a period in the 1980s and 90s, Medellin, capital of the Antioquia region of Colombia, held the infamous title of the most dangerous city in the world. As the seat of Pablo Escobar’s narcotic empire, Medellin was the epicentre of much of Colombia’s narco-fuelled violence, as the drug lord’s cartel fought to maintain its control of some 80 per cent of the global cocaine market. The city’s murder rate reached, at times, 250 per 100,000 inhabitants, compared to a rate in the US of roughly five per 100,000.

It was against this backdrop that 2011’s IBA Human Rights Award winner, Ivan Velasquez, forged his career in the law, initially as a prosecutor in the Antioquia region, dealing with such events as Escobar’s escape from La Catedral prison, and clashes between Los PEPE and Escobar’s organisation. He went on to lead efforts to expose the parapolitica scandal in Colombian politics, which uncovered massive corruption at the heart of public life throughout the country. Former IBA President Fernando Peláez-Pier caught up with auxiliary judge Velasquez of the criminal chamber of the Colombian Supreme Court, at the IBA’s annual conference in Dubai.

Fernando Peláez-Pier: Judge, allow me to ask you, why did you choose to go down this path? Why did you decide to investigate some of the most powerful figures in the Colombian political landscape? What led you to do this?

Ivan Velasquez: The truth is that we did not seek out these investigations; rather that circumstances brought them about. After 1992 and 1993, which were crucial years in Medellin, came a peaceful period for the investigation, until I became the regional director of the public prosecutor’s office in Medellin and had to confront the emergence and strengthening of paramilitary groups.

FPP: Your investigations have covered all sorts of situations: missing persons, torture, kidnapping … and the State appears to be involved in many of these cases.  To what extent does corruption penetrate, or [did it] used to penetrate Colombian public institutions?

IV: I think that unfortunately for Colombia, with regard to the paramilitary issues and more generally to drug trafficking and organised crime, in the mid-nineties, and the latter part of the 90s, there was a takeover – a seizure of the State – by organised crime, which led to situations similar to this one and which we have had to investigate.

The fact is that to date, more than 35 congressmen have been convicted for links to paramilitaries, and this demonstrates the scale of corruption within the State. It was not limited to members of congress. The jurisdiction of the Court is limited to the members of congress and to the regional governors. However, corruption has expanded to all spheres of public and private activity. It is present in the economic field, in local administration, in political relationships. In sum, corruption has affected all the levels of State administration. I think that the penetration of corruption has been so strong that what has occurred is an appropriation of the State by organised crime.

We are still trying to get out of this situation, because there is no doubt that corruption in Colombia is still rooted in all the public administrative sectors.

The guerrillas continue frequently to perpetrate violent attacks against the population, during conflicts or in ambushes against public authorities. The activities of drug trafficking organisations or what are now called ‘bandas criminales’ (criminal gangs) are also a serious problem.

FPP: Drug trafficking organisations have decreased in number; it seems that they have drastically decreased and that they have moved to other countries such as Mexico, or Venezuela which has become an important drug transit point.
There is still the necessity to fight against this scourge. I believe that there should be a joint initiative between all the countries which are suffering from this. We see how the situation has drastically deteriorated in Mexico: it is said that Mexico has become the new Colombia.

However, it seems that a consensus does not exist between these countries in order to effectively eradicate this scourge. Moreover, I believe that it is not only drug-producing countries which should have this responsibility but also drug-consuming countries, and we know that the principal consumers are located in the north part of Latin America. What is your opinion on this? In your opinion, what has to be done to reach this consensus?

IV: I think that what has occurred throughout this fight against drug trafficking… the Oficina de Envigado – you were talking at the beginning about the Medellin cartel, well its sister, the Oficina de Envigado has existed over the last five presidential mandates and still exists.

There has been a tremendous level of corruption. The corruption that has emerged from drug trafficking is incalculable.
This corruption has damaged security forces, especially the national police. Affirmations of drug trafficking penetration into the police sector have existed for a long time, despite the considerable efforts undertaken to control the situation.

I think that we should seriously reconsider the path we should take to fight against drug trafficking.

At the least, we should attentively examine the proposition put forward by the former presidents of Brazil, Colombia and Mexico.
They have asked whether legalisation would not be a more viable option so that resources could be dedicated to drug prevention rather than to repression given that as I have mentioned earlier, the Oficina de Envigado has persisted over five presidential mandates.

However, we must think about it concretely, not to become tolerant of crime but rather to identify what can be more useful for our countries, especially for countries within Latin America which have seriously suffered from drug trafficking.

FPP: Yes, that is a very big challenge and it remains to be seen how we will continue this fight against drug trafficking.

This is an edited version of a longer interview. To view it in full go to

However even close allies are deviating from the US party line when it comes to drug policy. One positive aspect of the democratisation of the drug trade has been that the US has found its prohibitionist stance and leadership of the drug war increasingly challenged. This has come not only from left-wing regimes like those of Venezuela, Bolivia and Ecuador, which regularly engage in anti-US rhetoric, but even allies like Guatemala, Colombia and Mexico.

This year the most strident call for a rethink of US drug policy came from the place you might least expect it. It was the recently elected, ex-military, President of Guatemala, Otto Perez who, despite making a strong stance on fighting crime the centrepiece of his successful election campaign, called for a debate on decriminalisation of drugs. In a balanced and considered op-ed in the Guardian in April this year, he argued that ‘drug consumption is a public health issue that, awkwardly, has been transformed into a criminal justice problem.’ He called for ‘drug regulation’, making comparisons with the controls placed upon tobacco and alcohol.

However at the Summit of the Americas in April in Cartagena, the beautiful Spanish colonial city on Colombia’s Caribbean coast, the issue was not put on the agenda, after US Vice President Joe Biden stated that ‘there is no possibility that the Obama-Biden administration will change its policy on legalisation.’ This, despite the fact that it was decriminalisation and regulation which were being mooted, not legalisation.

The change we need?
There are now serious calls for an overhaul to the purely prohibitive approach adopted by the US. Some heavy hitters have called from the decriminalisation of drug consumption. This falls short of a legalisation of drugs, but is a big leap from the US government position, which is to punish and imprison drug offenders.

Ironically Colombia now has a firm advocate for a more liberal approach to drug policy in the presidential palace. President Juan Manuel Santos provides a stark contrast to his predecessor, Alvaro Uribe, who was in perfect sync with US counterpart, George W Bush. Uribe overturned the 1991 Colombian Constitution on drug consumption which allowed for the personal use of drugs, even hard drugs like cocaine and heroin. President Santos has sought to undo some of the measures passed by his predecessor. Santos likened the drug war to riding a static bicycle: ‘We pedal and we pedal, but we do not make progress. We need to find other options to advance.’
His comments have been echoed by Colombia’s former National Police Director, Oscar Naranjo, voted the world best policeman as well as being a crucial Washington ally. He said that Colombia has ‘mortgaged its drug policy to US interests.’ He has called for the decriminalisation of marijuana use as a starting point.

'‘We pedal and we pedal, but we do not make progress. We need to find other options to advance’'
Juan Manuel Santos
Colombian President

Mexico is currently ground zero for the war on drugs, racking up some 50,000 casualties since 2006, when current President Felipe Calderon declared war on the cartels. However even Calderon has suggested that reform of drug policy is the way forward. ‘If the consumption of drugs cannot be limited, then decision-makers must seek more solutions – including market alternatives – in order to reduce the astronomical earnings of criminal organisations,’ he said last year on a visit to the US. His predecessor, former President Vicente Fox, has gone much further, calling for an outright legalisation of the drug trade. ‘My proposal is to legalise all drugs and their system of production,’ said Fox at a conference at the Cato Institute in Washington last year. ‘Education must be the crucial element in this matter.’

Uruguay has moved from rhetoric to action. In June the government proposed a law legalising the production and sale of marijuana (consumption has long been legal). Production of up to 100 hectares of cannabis crops will be controlled by the government.

The future of the drug war in Latin America
While the Obama administration has rebutted any attempts to decriminalise drugs or rethink overall drug policy, there is a shift. More and more the US is looking to disengage from foreign adventures and these include large deployments of men and resources for the war on drugs. There is a subtle move in Washington to tackle the drug problem from a treatment perspective and concentrate efforts at home.

Latin America is growing in confidence, even as its economies strengthen while those of Europe and the US flounder. Latin American nations are happy to receive aid from the US, but now seriously question the conditions that come with it. Drug decriminalisation in the region is already underway, albeit in a sporadic and haphazard manner, country to country. The war on drugs is no longer the war to prevent drug shipments reaching the US; the war on drugs is now the war against domestic consumption, and each nation knows it has to shoulder that burden alone. The US may provide funding and aid, but at the end of the day it is a national problem and now the greatest single threat to the national security of the countries that form this region. The Achilles heel of these national wars against organised crime and drugs is not just corrupt law enforcement agencies, but weak justice systems unable to process criminals and secure convictions. In Colombia, often held up as the regional success story, convictions are secured of less than ten per cent of those arrested for crime. Most of the criminals, even those caught ‘en flagrancia’, are walking out of the back door, and straight back into business.


Jeremy McDermott is the co-director of InSight Crime and is based in Medellin.