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How Mexican Drug Cartels Earn Billions in Drug Trade

First Posted: Feb 03, 2016 06:00 AM EST
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How Mexican Drug Cartels Earn Billions in Drug Trade

How Mexican Drug Cartels Earn Billions in Drug Trade(Photo : Getty Images/Sandy Huffaker )

"Gangster Warlords" author Ioan Grillo recently revealed how the notorious Mexican drug cartels are making billions of dollars because of drug trade in the United States. In a video published on Business Insider, Grillo explained how traffickers invest in drugs and how much profits they earn.

Mexico has been known to produce substantial amounts of marijuana and crystal meth, as well as smaller quantities of heroin. While South America is the source of cocaine Mexican drug cartels and gangs smuggle into the United States.

In the video entitled, "Narconomics: How Drug Cartels Make Billions," Grillo noted that Mexican drug cartels mainly smuggle marijuana, cocaine, heroin, crystal methamphetamines and Ecstasy in America. He also revealed that traffickers make a lot of profits because of cocaine.

Mexican cartels can buy a kilo of cocaine in the highlands of Colombia or Peru for a wholesale price of $2,000. But its value increases as it makes its way to the market, New York Times noted.

In Mexico, a kilo of cocaine brings more than $10,000. And once drug trafficker sell it on the U.S. border, they can earn as much as $30,000, 15 times its original price. But when they break it down into grams to distribute retail in New York, that same kilo of cocaine can be sold up to $100,000. In Europe, a kilo of cocaine can cost up to $101,490.

The numbers are only for cocaine, just imagine how much Mexican drug cartels earn through producing and exporting marijuana, heroin and methamphetamines as well.

Mexican authorities have also revealed that drug cartels earn $64.34 billion for their sales in the United States. According to Mexico's Public Safety Secretary Genaro Garcia Luna, figures compiled by international entities showed the production of cocaine in Colombia, Peru and Bolivia has remained stable over the past nine years at an average of about 900 tons a year, Latin American Herald Tribune has learned.

He also acknowledged Mexico's domestic drug problem, where Mexicans spend an average of $431 million per year on illegal drugs.

Criminal organizations have also taken advantage of globalization. The secretary stressed that drugs cartels have expanded their activities through the opening up of the financial markets and technological development.

Aside from drug trade, criminal organizations are also involved in trafficking of weapons and migrants, smuggling other items, money laundering, vehicle theft, kidnappings-for-ransom and extortion.

Meanwhile, estimating the precise scale of Mexican drug cartels, however, can be complicated. Underground economies or black market statistics are inherently speculative because they don't make annual disclosures and no auditor inspects their books.

In other news, U.S. and Mexicans officials reported that 22 members of the notorious Sinaloa cartel have been arrested while two were killed during a police raid near the U.S.-Mexico borders on Friday, Jan. 29. According to Reuters (via Aol), the authorities have also seized assault-type weapons.

The undisclosed operation came just weeks after the arrest of cartel leader Joaquin "El Chapo" Guzman.

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