The greater political freedom that has come to many African countries over the past three decades, and their opening to world markets, has brought a dark dividend — the proliferation of highly efficient crime syndicates.

These syndicates have easy access to arms thanks to, among other things, the chaos in Libya after the death of Muammar Gaddafi in 2011 and peace accords in countries like Mozambique. About 100-million small arms and other light weapons are believed to be stockpiled or in circulation in Africa, a rich resource for criminal gangs seeking weapons to help them protect their routes and create new markets.

Three separate studies conducted recently show, among other things, that the trade in Colombian cocaine via West Africa and Afghan heroin via East Africa is soaring, with political elites and crime syndicates working hand in hand; and that tax avoidance by multinational companies, particularly in the extractive industries, is equivalent to 11.6% of trade lost to Sub-Saharan Africa.

The research was conducted by the Thomson Reuters Foundation’s Wealth of Nations project, Global Financial Integrity and Enact, a three-year, EU-funded project aimed at combating transnational organised crime in Africa. One of the partners in the Enact project is the Global Initiative Against Transnational Organised Crime, whose director, Mark Shaw, says that in Africa such crime falls into three broad, linked systems:

• Illicit products flowing into and through Africa — primarily drugs, weapons and shady financial services;

• Resources originating in the continent and sold abroad — mainly blood diamonds and other illegally mined metals and minerals, illegally logged timber, stolen oil, poached ivory and rhino horn, endangered species, plus illegal, unreported and unregulated (IUU) fish catches; and

• Cybercrime, migrant smuggling, and the production of counterfeit goods, including medicines.

Shaw says all three areas are worsened by "conflict, weak governance or the prevalence of corruption", and the very diversity of the criminal landscape — from the manufacture of fake luxury brands and cigarette smuggling to human trafficking and piracy — complicates policy and law-enforcement responses.

Organised crime has distorted African economies and politics, transforming Guinea-Bissau, for example, into arguably Africa’s first "narco-state" by 2008, as military and political factions colluded in establishing a cocaine pipeline whose profits dwarfed the country’s GDP.

In contrast to regions such as Latin America, "the study of organised crime has not been prioritised in Africa", says Shaw. He says Africa’s criminal syndicates had their beginnings in small-scale, localised operations in the late 1980s like rhino-horn smuggling in Southern Africa or crude-oil theft in the Niger Delta, but within a decade these groups had coalesced and become more professional.

The Delta oil thieves are so well organised and politically protected today that they tap directly from wellheads and transfer their crude to "legitimate" tankers offshore, accounting for up to 400,000 barrels a day or 15% of total production.

Click to enlarge.
Click to enlarge.

Vast amounts of money are involved: illegal logging is worth $17bn a year, untaxed gold exports cost Ghana more than $6bn a year in lost revenue, IUU fishing costs West Africa $2.3bn a year, counterfeit anti-malarial drugs are a $400m-a-year industry in West Africa, cybercrime costs Africa $895m a year, and the theft of refined fuel in Libya is conservatively worth $200m a year.

Complicating matters, illegal markets are often the only sources of income for poor populations — a 2013 estimate was that 8-million artisanal miners, mostly in the illicit gold sector, supported 45-million people, while in the Central African Republic 400,000 diamond miners, mostly illegal, produced 80% of the country’s output.

One of the key drivers of the shift from the smaller gangs of the past to the sophisticated modern syndicates of today was the end of the Cold War.

On the one hand it freed up surplus firearms with which gangs could enforce their control, and on the other it forced insurgent guerrilla groups, abandoned by their superpower patrons, to get involved in illegal mining to finance their rebellions. Extremist groups in the Sahel frequently fund their operations through trade in contraband cigarettes.

Shaw says the dramatic growth and capacity of syndicate crime in Africa is due in part to the globalisation of communication and trade, which created "the sinews for Africa’s closer integration into the global economy".

Other factors include the growth of several major global illicit markets over the past two decades, most prominently narcotics; strong Asian demand for illicit products; the increasing involvement of foreigners — notably Chinese, Indians, Italians, Russians and Lebanese — in syndicates in Africa; and "growing corruption and systems of protection in many African governments and institutions".

On that last point, over the past decade syndicates have evolved from establishing beachheads in failed states such as Somalia, Libya and Liberia to integrating themselves within stable, economically diversified states such as Nigeria and SA. The large financial institutions and infrastructure in such countries provide greater opportunities for money-laundering and boosting volumes.

Another consequence of more vibrant democracies is the mushrooming of political parties in need of campaign funding, which is often obtained in irregular ways.

One of the studies described this process not as organised crime but as "the criminalisation of the state", a process not dissimilar to state capture in SA.

Shaw says arms embargoes since 2000 against 15 rogue governments and rebel movements have created "a symbiosis between the arms trade, political interests and the illicit economy in parts of the continent, whereby mining concessions or access to natural resources are bartered in exchange for arms".

He says the drug trade ballooned in Africa not only because Latin American and Central Asian narco-traffickers sought routes into the US and Europe that were less rigorously policed, but because the markets in the north were glutted and Africa offered new opportunities.

By 2015, about 10% of the population of Zanzibar, a key heroin trans-shipment point, were involved in the drug economy.

One worrying tendency, Shaw says, is that better law enforcement sometimes has perverse effects. The syndicates behind human trafficking and migrant smuggling, faced with stricter border controls, tend to become more heavily armed and violent.

On the positive side, some legal measures have undercut illicit markets, as with last year’s total ban by China on the ivory trade, which resulted in the ivory price dropping from $2,100 a kilogram in early 2014 to $730 a kilogram in April 2017. But as Africa’s economic growth also fuels its shadow economy, the future of syndicate crime and the efforts to combat it are hard to predict.

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