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MEXICAN DRUG CARTELS SAID TO EARN AS MUCH AS US$40 BILLION.

Article Excerpt
Earlier this year, Forbes magazine listed notorious drug-cartel leader Joaquin Guzman Loera among its "new billionaires." Earnings of the Sinaloa cartel leader, who is also known as El Chapo, are only a fraction of what the drug industry earns as a whole. A recent report from consulting company Kroll de Mexico put earnings of drug traffickers in Mexico as high as US$40 billion. A separate report from the US government notes that the cartels are able to make the most of their earnings by organizing in much the same fashion as multinational corporations. The heavy financial power of the cartels has allowed drug traffickers to more than hold their own against the anti-drug efforts of Mexican law-enforcement agencies.

Earnings surpass budget for many Mexican government ministries

The Forbes listing of Guzman Loera among the world's billionaires caught many observers by surprise (see SourceMex, 2009-03-18), even though the high earnings of Mexican drug traffickers are common knowledge. Kroll, which put together a report for an Americas conference in Miami, estimated that Mexican cartels earn between US$25 billion and US$40 billion per year.

Some observers pointed out that drug-trade earnings surpass the budget of many Mexican government ministries. "These resources are three times higher than the budget requested by the Secretaria de Educacion Publica in 2010," said the Mexico City daily newspaper El Universal.

Kroll official David Robillard told participants at the conference--which was organized by the World Bank, Florida International University (FIU), and the state of Florida--that the annual drug-trade earnings greatly surpass remittances from Mexican expatriates. Remittances are expected to be down this...

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