The Illicit Economy’s Impact on Democracy: Case Studies in Bolivia and Ecuador

Transnational Organized Crime (TOC) “poses a direct and escalating threat to public health, public safety, and national security,” according to the White House.[1] It also poses a significant threat to democracy in the Latin America and Caribbean (LAC) region.

This report focuses on TOC’s impact on democratic institutions in LAC. It examines how the persistent presence of illicit local economies like illegal mining, timber trafficking, and human smuggling feeds Mexican and Colombian cartels and other mafias around the region. It analyzes how criminal activities such as drug trafficking, bribery, illicit campaign finance, and political violence (e.g., political assassinations) feed an ecosystem of corruption comprising police, judges, candidates, politicians, and elected authorities.

This report also illustrates how organized crime infiltrates democratic institutions and corrupts politicians, eroding democratic stability and citizens’ trust in the political process. This political corruption, enabled by complicit judicial, governmental, and local officials, as well as law enforcement agencies like the police and military, often allows organized crime to operate with impunity. This engenders distrust and creates a chasm between a political system and citizens, opening the way for populist and disruptive actors to offer extreme solutions that threaten democratic principles.

Finally, this report describes how corrupt regimes sometimes act as conduit for corrosive influence from China, further undermining democratic institutions.

Addressing pervasive criminality requires comprehensive measures to reinforce democratic institutions, strengthen law enforcement, and promote transparency in politics. This report summarizes recommendations for action—with special attention to the international community—in the legislative, law enforcement, and civil society arenas.


[1] https://www.whitehouse.gov/briefing-room/presidential-actions/2021/12/15/executive-order-on-establishing-the-united-states-council-on-transnational-organized-crime/#:~:text=(i)%20The%20Division%20shall%20produce,and%20funding%20for%20the%20Division.

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