HomeNewsBriefColombia’s Growing Local Drug Market Now Worth $2 Bn, Govt Says
BRIEF

Colombia’s Growing Local Drug Market Now Worth $2 Bn, Govt Says

COLOMBIA / 10 NOV 2016 BY MIMI YAGOUB EN

Colombia’s internal drug market has grown over the past few decades and is now worth an estimated $2 billion, a trend driven by changing economic and criminal dynamics in the country. 

A new report by Colombia’s Planning Department reveals that drug use within the country has grown as a result of historic shifts in local organized crime. (Download the full presentation in Spanish here – pdf)

In 2015, the sale of drugs in Colombia’s internal market was worth a potential $2 billion (6,011 billion Colombian pesos), equivalent to 0.75 percent of the country’s Gross Domestic Product (GDP), according to official figures. Marijuana represented 73 percent of the total value, while cocaine represented 24 percent and crack cocaine, 3 percent. (See graph below)

 

In comparison, transnational drug trafficking was worth a potential $6.8 billion (20,500 billion pesos), or 3.8 percent of GDP.

The prevalence of cocaine use has remained the same over the past seven years at 0.7 percent of the population, the report shows. However, between 2008 and 2014, the country went from being the sixth largest to the fourth largest consumer of the drug in South America.

Marijuana users made up 3.3 percent of the population in 2015, up from 2.3 percent in 2008. Colombia also rose to become the fourth largest consumer of the drug in 2014, after being seventh on the list in 2008.

InSight Crime Analysis

There are a number of factors that are driving up the value of the internal drug market in Colombia, a country that’s more known for its role in the global cocaine trade.

One reason is that the profitability of international drug trafficking has plumetted since the 1980s and 1990s. During that period, the Medellín and Cali Cartels had a monopoly over all rungs of Colombia’s drug trade, and the return on trafficking drugs was as high as 2,790 percent, the report states.

This decreased to 810 percent at the turn of the century following the decimation of the cartels, and then to 260 percent between 2009 and 2015. In contrast, the return on investment for distributing drugs in Colombia at a retail level is significantly higher, at 346 percent. This number surges to 1,407 percent for cocaine.

SEE ALSO:  Colombia News and Profiles

Another underworld shake-up that impacted the local drug market was the dismantling of the paramiltiary umbrella group United Self-Defense Forces of Colombia (Autodefensas Unidas de Colombia – AUC) and the rise of criminal successor groups in the mid- to late-2000s. The paramilitaries controlled crucial drug export structures that were lost when its leaders were extradited to the United States in 2008, resulting in local markets being flooded with illegal drugs. And unlike their paramilitary predecessors, these groups have no ideological resistance to trafficking drugs within Colombia’s borders.

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