Illicit trade has reached 500 billion dollars in the latest reportsMay 18, 2020
Illicit trade has reached 500 billion dollars in the latest reports, amounting at 2,5% of the global trade. Said shocking numbers reveal that illicit trade has become a worldwide cancer, affecting our families, societies and economy.
Unfortunately, it is not in its early stages, thus the immediate need to tackle this matter in a joint public private partnership on an international level.
Today, we are living in an interconnected world, a small city with the fast-growing technologies in transportation (Hyperloop, one road one belt project), in payment (crypto currencies, blockchain), in production (3D printing), in internet (big Data). Therefore, we need to employ said technologies to downsize illicit trade.
First, we should go back to the basics, illicit trade is a serious economic crime.
It is a crime affecting the governments by its loss of revenues (smuggling, Tax evasion, human and material resources deployed), its capacity to attract foreign investment (no protection of intellectual property rights and lack of fair trade create an unfavorable environment to invest/expand).
It is a crime affecting the society. The consumers are exposed to direct and indirect risks related to their health and safety (counterfeit spare-parts leading to deadly accidents, fake electronics causing fatal fires…). It touches on every single side of our life.
It is a serious crime, that should be elevated to the level of unethical crimes in our mindset. it is not just a counterfeit or pirated product. It is a theft of rights endangering our health and security, disturbing the economic and social stability. It is an organized crime as classified by Interpol several years ago.
Second, as a serious crime, the sanction should be deterrent.
With the current applicable laws and its application in the courts, judges tend to apply the minimum sanction (i.e. minimum fine) without taking into account the real cost and losses occurred by the government, society and the investors, nor assessing the huge margin of profits infringers are making.
On average, a study revealed that you can turn 1 AED into:
- 20 AED in illicit tobacco trade (smuggling)
- 25 AED in counterfeit products
- 250 AED in pirated products
Illicit trade is all about making easy money illegitimately. Therefore, the solution is to confiscate the proceeds of crime to eliminate them once and for all from returning to the same illegal business.
Third, we should look into the future of business in general and especially now with the Covid 19 outbreak worldwide where the online business model is leading by far the channels of distribution. Said disruption in the supply chain affected the illicit trade as well. More and more we are facing websites, marketplaces, social media accounts, express shipments and parcels of counterfeit and pirated goods.
This calls for a quick search in the newest technologies (Artificial intelligence, blockchain and big data) and their deployment in the fight against the online trade of counterfeits and pirated goods.
Finally and to sum up, the fight against illicit trade requires a public private partnership and an international cooperation between countries deploying latest technologies in order to turn back the crime!