Mexico's cartels are making inroads into Australia as Latin American drug trafficking organizations continue to look for lucrative markets far from home, a new report says.
The Strategic and Defence Studies Centre (SDSC) report (pdf) identifies the Sinaloa Cartel as the main organization consolidating its influence and contacts in Australia.
Mexican cartels are selling drugs wholesale to local groups including "Lebanese, Chinese and Albanian diaspora groups, and Australian biker gangs," the report says. The cartels have reportedly been setting up connections throughout the Asia Pacific region, with Australia as their primary "target."
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The report warns that the Mexican model of consolidating strong ties with local criminal groups in new markets is a threat to Australia's national security. One of the dangers involves what the report calls "sweeteners" -- cartels providing locals with handguns and other weapons as incentives for their business deals.
Furthermore, Mexican organizations' indiscriminate association with any local group capable of handling large drug shipments could lead to clashes over control of distribution networks. The cartel presence may compromise the stability of border security and transit spots, according to the defense think tank based at the Australian National University's College of Asia and the Pacific.
Mexican drug trafficking organizations reportedly first appeared on the Australian scene in 2010, when a number of Mexican nationals with cartel ties were arrested during counternarcotics operations.
The report cautions, however, that it is hard to confirm whether the Mexican cartel presence involves "permanent franchises" in the country or merely consists of "peripheral links" that are removed from the organization's central structure.
The SDSC's key policy recommendations are that the South Pacific "focus on intelligence gathering, maritime interdiction and capacity building in transit hubs" in order to hinder drug flows and disrupt criminal networks.
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As the report explains, Mexican drug cartels have for some time been looking beyond their northern neighbors to tap in to lucrative drug markets in Europe and the Asia Pacific. Indeed, the Sinaloa Cartel's expansion into Australia has been well-documented for years.
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Mexican cartels' incursion into Australia is due to a series of "push" and "pull" factors, the SDSC notes. The cartels get a "push" from decreasing demand for drugs in the United States, a major consumer nation for Mexican narcotics.
Australia's major "pull" factor is its own consumer market -- one of the largest in the world -- and the higher prices of drugs sold in the country. While US drug prices are falling -- according the report -- the difficulty of trafficking narcotics to more distant countries drives profits through the roof. The SDSC says the same kilogram of cocaine can be sold for $54,000 in the United States, $87,000 in the United Kingdom, and between $228,000 to $259,000 if it reaches Australia.
Australia's giant demand for Amphetamine-Type Stimulants (ATS) also caters to Mexico's booming production of these substances. Methamphetamine sold wholesale in Australia can be nearly 20 times as expensive as in Mexico.
Mexican cartels' outward expansion into new markets has been felt in other parts of the world, not least the European Union. And they are not alone -- Colombian traffickers are similarly spreading their tentacles in distant countries, including Australia.