Cartels use COVID-19 as excuse to raise drug prices, distribute food to poor in Mexico, report says

Border Report

Far from suffering losses, transnational criminal organizations adapted to challenge and are now in expansion mode, Congressional Research Service says

A man poses with a box with donations of basic goods handed to him by employees of the foundation of Alejandrina Guzman, daughter of Mexican drug lord Joaquin “El Chapo” Guzman, amid the new coronavirus pandemic in Guadalajara, Mexico, on April 17, 2020. (Photo by Ulises Ruiz / AFP) (Photo by ULISES RUIZ/AFP via Getty Images)

EL PASO, Texas (Border Report) – Mexican drug cartels not only weathered the COVID-19 pandemic but used it to score public relations points and some are even showing signs of expansion, a new U.S. government report says.

Photos of cartel operatives distributing “COVID” assistance in the form of food rations in boxes bearing the logos of the Sinaloa cartel flooded social media during the height of the pandemic. Videos of criminal groups “disciplining” overnight curfew breakers could also be found.

An employee of the Alejandrina Guzman Foundation wears a face mask with the image of Mexican drug lord Joaquin “El Chapo” Guzman -Alejandrina’s father- as she arranges boxes with basic goods to be donated to people in need amid the new coronavirus pandemic in Guadalajara, Mexico, on April 17, 2020. (Photo by ULISES RUIZ/AFP via Getty Images)
An employee of the Alejandrina Guzman Foundation wears a face mask with the image of Mexican drug lord Joaquin “El Chapo” Guzman -Alejandrina’s father- as she hands a box with donations of basic goods to a man in a wheelchair amid the new coronavirus pandemic in Guadalajara, Mexico, on April 17, 2020. (Photo by ULISES RUIZ/AFP via Getty Images)

The transnational criminal organizations did sweat out shortages of precursor chemicals from China and India during the pandemic but adjusted and are even now looking for alternate providers, the report said. Opium poppy cultivation and heroin production have been largely unaffected.

“The Sinaloa cartel and the Jalisco New Generation Cartel (CJNG) in particular show signs of expansion in Mexico and have increased their role in production and pill-pressing,” says the April 2 report by the Congressional Research Service. “Neither the risk of infection nor government-mandated mobility restrictions during the pandemic appear to have significantly deterred cartel activity.”

The report states criminal groups distributed aid packages branded with cartel insignia in poor communities and enforced COVID-19 lockdowns. “Such activities, amplified on social media, appear to be intended to win community support for their criminal enterprises and attract recruits,” the CRS said.

So even if these transnational criminal organizations apparently did not incur losses during the pandemic, they used it as an excuse to raise the price of their drugs, acting as “price-setting cartels,” the report says, or a sort of commercial oligarchy.

They also became motivated to diversify their products and expand their use of technology – such as submersible craft, drones, ultralight airplanes and cross-border tunnels – and cryptocurrencies.

But even if they collude to set prices, the Mexican cartels continue at war with each other.

“Current conditions seem to have fostered intensified inter-cartel competition, favoring larger Mexican cartel’s territorial ambitions,” the report states. That seems to be backed up by record homicide rates there last year.

The report written by Latin American affairs analyst June S. Beittel and international crime and narcotics specialist Liana W. Rosen also raises questions about the extent of future U.S.-Mexico anti-drug cooperation. That’s because of the late 2020 release of former Mexican Secretary of Defense Salvador Cienfuegos, who had been arrested in Los Angeles on drug and money laundering charges. Observers “are watching closely as U.S.-Mexico anti-drug cooperation was severely buffeted” as a result of the incident, the report states.

Already, the North American Dialogue on Drug Policy, which was to be held in Mexico last December, was rescheduled for 2021. And the State Department reported that, despite some successes, “the volume of dangerous drugs from Mexico and violent crime within Mexico … remain alarmingly and unacceptably high,” the report concludes.

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