Illicit trade is the production or distribution of a good or service that is considered illegal by a

legislature A legislature is an assembly with the authority to make laws for a political entity such as a country or city. They are often contrasted with the executive and judicial powers of government. Laws enacted by legislatures are usually know ...

. It includes trade that is strictly illegal in different jurisdictions, as well as trade that is illegal in some jurisdictions but legal in others. Illicit trade can occur either in

black market A black market, underground economy, or shadow economy is a clandestine market or series of transactions that has some aspect of illegality or is characterized by noncompliance with an institutional set of rules. If the rule defines the ...

s or in legitimate markets. Some of the most important types of illicit trade include various forms of

smuggling Smuggling is the illegal transportation of objects, substances, information or people, such as out of a house or buildings, into a prison, or across an international border, in violation of applicable laws or other regulations. There are variou ...

, the

illegal drug trade The illegal drug trade or drug trafficking is a global black market dedicated to the cultivation, manufacture, distribution and sale of prohibited drugs. Most jurisdictions prohibit trade, except under license, of many types of drugs through ...

counterfeiting To counterfeit means to imitate something authentic, with the intent to steal, destroy, or replace the original, for use in illegal transactions, or otherwise to deceive individuals into believing that the fake is of equal or greater value tha ...

human trafficking Human trafficking is the trade of humans for the purpose of forced labour, sexual slavery, or commercial sexual exploitation for the trafficker or others. This may encompass providing a spouse in the context of forced marriage, or the extra ...

, the illicit tobacco trade,

arms trafficking Arms trafficking or gunrunning is the illicit trade of contraband small arms and ammunition, which constitutes part of a broad range of illegal activities often associated with transnational criminal organizations. The illegal trade of small ar ...

, illicit trafficking of cultural property, and various environmental crimes such as illegal wildlife trade,

illegal logging Illegal logging is the harvest, transportation, purchase or sale of timber in violation of laws. The harvesting procedure itself may be illegal, including using corrupt means to gain access to forests; extraction without permission, or from a p ...

and illegal fishing.

International initiatives to combat illicit trade

While there are several international treaties for dealing with specific types of illicit trade, it is said that a cross-sector approach as well as increased collaboration and communication between stakeholders are necessary to address illicit trade more efficiently. In 2013, the

OECD The Organisation for Economic Co-operation and Development (OECD; french: Organisation de coopération et de développement économiques, ''OCDE'') is an intergovernmental organisation with 38 member countries, founded in 1961 to stimulate e ...

launched a Task Force Countering on Illicit Trade, which focuses on developing evidence-based research and coordinating international expertise in quantifying and mapping illicit markets. Since 2013, The

World Customs Organization The World Customs Organization (WCO) is an intergovernmental organization headquartered in Brussels, Belgium. The WCO works on customs-related matters including the development of international conventions, instruments, and tools on topics suc ...

produces a yearly report on illicit trade which uses seizure data and case studies to study illicit trade flows. In February 2020,

UNCTAD The United Nations Conference on Trade and Development (UNCTAD) is an intergovernmental organization within the United Nations Secretariat that promotes the interests of developing countries in world trade. It was established in 1964 by the ...

held a Forum on illicit trade. One of the main focus of the event was to evaluate how illicit trade impacts negatively the

Sustainable Development Goals The Sustainable Development Goals (SDGs) or Global Goals are a collection of 17 interlinked objectives designed to serve as a "shared blueprint for peace and prosperity for people and the planet, now and into the future".United Nations (2017) R ...

. According to the Global Initiative Against Transnational Organized Crime and to Tradeslab, not only the

World Trade Organization The World Trade Organization (WTO) is an intergovernmental organization that regulates and facilitates international trade. With effective cooperation in the United Nations System, governments use the organization to establish, revise, and e ...

has rather limited tools to deal with illicit trade, but it may also limit the ability of states to combat it.

Measurements on illicit trade

By considering 12 different illicit markets, Global Financial Integrity estimated the value of illicit trade at $650 billion in 2011. The UNODC estimated in 2012 that the illicit trade activities of

transnational organized crime Transnational organized crime (TOC) is organized crime coordinated across national borders, involving groups or markets of individuals working in more than one country to plan and execute illegal business ventures. In order to achieve their ...

have a combined annual value of $870 billion per year. The Economist Intelligence Unit developed in 2018 a Global Illicit Trade Index, which evaluates the structural capacities of 84 countries to fight illicit trade.

Debates and controversies

Several authors and organizations assert that globalization has led to a significant increase of illicit trade, and that it has become a significant global threat. However, some authors argue that illicit trade has not necessarily grown in proportion to licit trade, and that an historical perspective is missing in the current assessment of its importance.

References

{{Reflist Organized crime Corruption