The term illicit economy refers to all illegal economic activity. Sometimes referred to as the shadow economy, black market or informal economy, it represents the dark side of globalization. It
The illicit economy is one of the most daunting challenges we face today. It is growing by leaps and bounds, accounting for 8 to 15 percent of the global Gross Domestic Product, said Senior Director for National Security and Diplomacy Anti-Crime Programs, David Luna.
“The global illicit economy is experiencing a boom across a wide spectrum of activities: narcotics, kidnapping-for-ransom, arms trafficking, human smuggling and trafficking, the trade in stolen and counterfeit goods, smuggling of antiquities and cultural artifacts, bribery, and money laundering.”
The illicit economy robs legitimate markets by undercutting legitimate businesses. Black market participants do not pay sales or corporate taxes or import tariffs. They do not necessarily guarantee the quality or authenticity of the goods they offer, and thus could be cheating their customers. Authorities that cannot stop them may be viewed with suspicion, leading to distrust of institutions and a deterioration in the quality of life for millions of people.
One way to fight the global illicit economy is to crack down on intellectual property infringement.
“Protection of intellectual property is at the very heart of economic growth and innovation. When innovators and creators know their creations are safe from theft, they are more inclined to bring new products and ideas to society that enrich and improve our lives.”
“Weak protection, on the other hand, makes it difficult for private companies to reap the benefits of their investments in R&D and thus reduces their incentive to make those investments,” said Director Luna.
Thus we must enact and implement strong and effective laws to combat criminal activities. At the same time, governments, businesses and citizens need to cooperate across national boundaries to defend our shared interests. Above all, we must all work together, said Director Luna.
“It is not hyperbole to say the convergence of illicit networks is an existential threat to human progress. We must stand together to meet – and defeat - this threat.”
