Intertwining legal and illegal commodities in Mexican exports
by Meredith Rector
Committee on U.S.-Latin American Relations (CUSLAR)
Growing mangoes in the southern Mexican state of Oaxaca has racked up an enormous socio-political expense for the region far greater than the price tag on the fruit in the supermarket. For a Mexican drug cartel desperate to move product, hiding illicit drugs in mango shipments is a risky but viable cover for getting them to the U.S. market. For the people of Oaxaca, however, the infiltration of one of the region’s most important industries indicates the unavoidable threat of a life controlled by drug violence and its wide-ranging effects on society.
Drug trafficking is a complex and multifaceted problem and has proliferated as Mexico continues to face economic troubles and ungovernability. Various sectors of the Mexican economy have struggled or failed altogether as a direct result of the North American Free Trade Agreement (NAFTA), which took effect in 1994.
According to Clint McCowen in his report Globalization and the Mexican Market, the period immediately following the implementation of NAFTA brought job loss on a massive scale with unemployment rates over 55 percent. Part of this job loss was that many Mexican businesses could not compete with imported subsidized goods after the elimination of tariffs and trade barriers and the privatization of previously state-owned companies. This blow also affected small to medium- sized farms and left the agricultural sector monopolized by the corporate counterparts, which cost Mexican farmers $12.8 billion from 1997-2005.
One sector of the Mexican economy that grew during this period of stagnation was the informal sector, that is, economic activity that is untaxed and unregulated by the government and includes drug traffickers. The progress of these industries in their respective fields and the control of the agricultural sector by drug cartels has led to the birth of a socio-economic hybrid called “narco-agriculture.” Many different kinds of fruit have served as the front of drug cartel operations in recent years. But the most recent and prominent infiltrated sector is the mango market.
Oaxaca has particularly felt the effects of drug cartel infiltration because it is such a strong contributor of mangoes to the world economy. Exporting 32,000 tons of mangos to Canada and the U.S. in the 2016 growing season alone, no other region has the same level of success.
According to Will Cavan, Executive Director of the International Mango Association, not only do mango farms serve as a way for cartels to launder their money, but it also gives them control over the market prices and profit.
Regional cartels can order a halt on mango export production to drive up prices. Intimidation tactics such as kidnapping, murder and extortion are used to influence the amount of mangoes shipped out at the cartels’ convenience. Much of the profit is pocketed and never goes to the legitimate producers, according to Cavan.
In addition to these violent tactics typical of cartels for the last decade, cartel leaders are actually quite heavily involved in production and product restriction in order to both launder money and diversify their operations. And even before these shipping processes are tampered with, the cartels can manipulate into existence a free or cheap labor source for the picking process. Oaxacans often choose hard labor to alleviate extreme poverty common in rural areas of Mexico.
Many accept cheap wages and complicity with the cartels in order to subsist for themselves and their families. Aside from a local supply, Central American migrants are frequently forced into working for cartels in this region, according to one Mexican community development leader. Because migrants don’t often have legal documentation to be in Mexico, they are vulnerable to detention and not a priority for the overtaxed Mexican judicial system. Overall, a combination of old tactics and new tricks are being used to infiltrate the mango industry, from growth and picking to shipment and distribution.
Aside from the control over the product, success of the market and access to cheap labor, the mango market has another benefit for cartels. This industry allows for drug smuggling, as border patrol agents cannot inspect every box.
In his book The Fruit Hunters, Adam Leith Gollner talks with a fruit industry professional in Montreal about the apathy in checking such large volumes of fruit, and also the bribery inherent at border patrol checkpoints. With proper preparation for these circumstances, cartels can ensure the passage of their products, both legal and illegal.
This convergence of the illegal drug trade with Mexican export-based agriculture has created a new challenge: impeding the damaging effects of drug cartels and their culture of fear and violence, while allowing one of the bright spots of the struggling Mexican economy to flourish. Tackling such a complex regional issue requires attentiveness and mutual understanding by leaders of both the United States and Mexico.
Will the recent election of Donald Trump as U.S. president allow for such a collaboration? The incoming Trump administration may choose to limit dealings with Mexico across the board. NAFTA, the two countries’ most significant collaboration, is in danger.
One of Trump’s central campaign promises was that he would end NAFTA, because he claims it is “maybe the worst trade deal ever signed anywhere, but certainly ever signed in this country.”
However, ending NAFTA would have serious effects. According to the Bloomberg Network, even implementing new tariffs as low as 3 percent could cause a 10 percent reduction in Mexico’s exports within a year of implementation. According to the U.S. Chamber of Commerce, 6 million American jobs depend on free trade with Mexico and could be lost along with NAFTA. While Trump should oppose the deal that contributed to a major decline in the way of life of the U.S. and Mexican working classes, he should also observe the implications of his policy decisions. An economic deal implemented for over twenty years has been engrained in the North American economy.
Causing instability with such a decision could exacerbate the very problems Trump seeks to eliminate, among them irregular immigration and drug trafficking.
Opting out of NAFTA as Trump proposes seems reactionary, rash and essentially based on a naive hope that high-paying manufacturing jobs would return to the U.S. once NAFTA was removed.
However, the global economy has changed, and most of these jobs are being done by robots today, not Mexicans. In light of this new structural reality, we must take a serious look at NAFTA and other policies, and focus our resources on making sure the most vulnerable in the region are cared for. For the sake of regional cooperation, for the sake of societal growth, and for the sake of the mangoes.
Meredith Rector is a senior at Elmira College majoring in International Studies and Spanish with a minor in Political Science.
This article has been published subsequently in the online journals Independent Science and The New Food Economy.