Last week the international research company Euromonitor International released a study which States that the pandemic COVID-19 and introduced restrictive measures have led to increased illegal production and trade in different products. According to the world economic forum (WEF), the world economy losses from such activities in 2020 could reach $2.2 trillion, or 3% of world GDP.You can not deny zarabotatj research from Euromonitor International titled “Illegal trade during coronavirus” noted that “in the beginning of 2020 international trade was disrupted due to pandemic and the restrictions imposed on the movement of people and goods. The governments of different countries reacted to the epidemic a number of measures, including social distancing, isolation, increased demands on hygiene and direct intervention in the economy”. It is noted that in some countries, governments began to control the offer and sale of certain products, affecting production and distribution, for example, PPE (masks, gloves); or limit the production or sale of goods which, from the point of view of the government, are not of paramount importance in the context of the epidemic, such as alcohol and tobacco products. All these measures significantly damaged or altered existing supply chain system of distribution of goods and associated economic activity. Euromonitor notes that among the effects of a pandemic can be called the intensification of illegal trade, because of what the legal economy and the government lost billions of dollars of revenue. “In some sectors of the economy by transnational organized crime groups took advantage of an ineffective regulatory regime, disruptions in the supply of products, changing consumer attitudes and preference and price gaps”,— the researchers note.
They have classified the illegal trade and related activities and identified the main reasons of activation of such illegal activities. Most affected by the illegal trade was segments such as pharmaceuticals, products for hygiene and body care, household chemistry, tobacco, alcohol. The scale of illegal trade intensified in the context of the pandemic has attracted the attention of international organizations. For example, according to the world economic forum, the losses of world economy from the illegal trade in 2020 reached $2.2 trillion, which is 3% of the world GDP.The heyday Lankan samogonovarenie as examples of flourishing illegal trade because of the pandemic, imposed restrictions and incorrect assessment of the situation by the authorities Euromonitor International callt the situation in countries such as Malaysia, South Africa, France, Argentina, etc. for Example, in Malaysia and South Africa, the authorities have imposed restrictions or bans on the sale of tobacco products, the use of which, according to many scientists, with adverse consequences for cases COVID-19. As a result, in South Africa the price of cigarettes has soared to almost three times, which led to an increase in the smuggling and production of counterfeit goods. According to the tax authorities of South Africa, only restricting the sale of tobacco resulted in a loss for the Treasury of nearly $20 million in unpaid taxes and excise duties.Similar examples were observed in connection with the ill-considered decisions of the authorities in respect of alcoholic beverages. In Sri Lanka, after the introduction in March of a ban on the manufacture and sale of alcohol, the police recorded and stopped 18 thousand cases of illegal production of alcohol by local merchants or ordinary people. However, these measures did not save the production of vodka and other alcohol artisanal became widespread. According to the estimates of the government budget losses from unpaid sales taxes and excise taxes on alcohol amount to about $2.6 million a day. To counter the moonshine, the government even appealed to the regulator of the telecommunications market, to find a way of dealing with a widespread local social networks the recipe of alcohol in the home.Another example is the situation in France, where the government imposed a ban on the resale of masks, fearing price gouging by speculators. As a result of this ban, the lack of control and lack of resources for legal production of masks in sufficient quantity, the country had to face the flow of contraband masks — only in April, authorities confiscated about 500 thousand smuggled masks for a total amount of around €30 million for Natural resources under the control of mathiteias business managed faster authorities to respond to changing consumer preferences. One of the most striking examples is the situation with the sudden demand for masks-respirators with anti-virus protection (N95/FFP2). Illegal dealers were able to quickly establish mass production of counterfeit masks and to flood their countries such as USA, France, China and Peru, where authorities had to confiscate the millions. In the US, legal manufacturers of such masks even filed lawsuits against online stores who are unable to control the sale of counterfeit masks N95/FFP2.The flourishing illegal trade have occurred in countries where state control is ineffective and underdeveloped legal market processes have already been the reason for the high share of shadow business in the economy. This primarily applies to the countries of Africa South of the Sahara, and Latin America. According to the International monetary Fund, the ima��but these regions lead the world in the share of the shadow economy in the total economy — about 30%. It is reported that in some countries in these regions, the role of the state is so weak, and the effectiveness of state institutions is so low that organized crime is often directly competes with the state in such processes as order, security of citizens, the rules of the game or business financing.This situation has only worsened with the advent of COVID-19. For example, in some regions of Mexico, Colombia and Central America vacuum of legitimate authority leads to the fact that the local organized groups often provide order in the streets and the safety of ordinary citizens. It is reported that factions of MS-13 in El Salvador, the ELN in Colombia, and the cartel of Sinaloa in Mexico instead of the authorities enforce quarantine in several regions of the country and carried out full-scale activities in their provision of goods through illegal channels. The transfer of police and military in areas affected by the epidemic, led to the fact that in Mozambique, Brazil, Bolivia and the Congo criminal groups significantly increased the volume of illegal mining of local minerals.The experts of Euromonitor International believes that the unfavorable situation with the flourishing of illegal trade and associated activities to the authorities together with business, an urgent need to take action. “The government must perform what actions led to growth of illegal trade, and to make appropriate changes to the regulatory regime.Businesses and private organizations need to realize the new reality of trade in the new conditions, to evaluate the possibility of shady business in their sectors and to reorganise the supply chain to maximize limited resources and reduce negative consequences. In addition, now more than ever, it is important that private institutions have established a close cooperation with the government in order to inform and advise him, for the common struggle against illegal trade”,— specialists of the research company.Eugene Tail
