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Belize’s Illegal Cigarette Trade

Belize’s Corozal Free Zone, along the Mexican border, has become the capital of the nations’ black market cigarette sales
By The News · 19 of December 2016 11:21:10
Cigarettes, No available, photo: Flickr

Belize, that little former British colony on the eastern coast of Central America that has been the thorn on the side of Guatemalans ever since it first gained independence from the crown in 1981, is rapidly turning into a contraband haven, forsaking its reputation as a scuba divers’ dream destination and archeological wonder in favor of that of a cigarette smuggling paradise.

Lax custom regulations and a faltering economy plagued with growing unemployment (estimated at about 13 percent) have opened the door to organized illegal crime rings that are exploiting the country’s porous borders, lack of security measures and rugged geography.

And Belize’s Corozal Free Zone, along the Mexican border, has become the capital of the nations’ black market cigarette sales.

The problem has become so great that earlier this year, Mexican Ambassador to Belize Carlos Quesnel Meléndez publicly condemned Belize’s cigarette contrabanders.

“We are very concerned about this issue, and we have brought it to official discussions between both countries,” Quesnel Meléndez said.

“This is one of the main [bilateral] concerns of our people and the authorities based in Chetumal. We are doing everything within our efforts to combat, to fight the smuggling of cigarettes.”

The ambassador went on to say that the ongoing flood of illegal cigarettes from Belize into Mexico — which often end up in the hands of minors — are undercutting otherwise healthy binational trade relations.

He added that a two-way free-trade accord that would foster legitimate commercial interchange could help to eliminate this growing concern.

“There are many other products that could be traded openly and not through contraband, which affects the economy of the countries of the area,” he said.

The sources of Belize’s illegal cigarettes are multiple.

Black market tobacco products from India, China, Switzerland, Paraguay and Panama are all sold in Belize’s northeast border region, tax free and for a fraction of their normal legal price.

The unlawful cigarette trade in Belize has become so lucrative, in fact, that an official from the international tobacco giant Phillip Morris International (PMI) recently visited Corozal to negotiate the purchase of 10.8 million cigarettes for the sum of $314,000.

That amount of cigarettes would normally cost a legitimate Guatemalan retailer $500,000.

According to PMI reports, “the majority of cigarettes enter Belize via a Paraguay-Uruguay-Panama route, and then usually leave Belize by land over the border with Guatemala or Mexico, in vans packed with merchandise.”

The contraband cigarette trade is so widespread in the region that, according to a recent study, about 18 percent of all cigarettes sold in Guatemala are contraband, compared to 11.7 percent in El Salvador and 10 percent in Nicaragua and Costa Rica.

The Belizean government has taken a laissez-faire approach to trying to reel in the illegal cigarettes trade, offering token inspections and border checks to appease the complaints of its neighbors.

But the effected countries are cracking down.

Earlier this year, officials in Peten, Guatemala, discovered an abandoned truck with three million contraband cigarettes believed to have originated from Belize.

And in Aguascalientes, Mexico authorities inspected several stores which led to the seizure of more than 145,000 contraband cigarettes, again allegedly sourced from Belize.

Belize has serious economic concerns, and it has suffered the financial consequences of a global slowdown, several natural disasters and the topsy-turvy rollercoaster of international oil prices.

But there are much better ways to fan its economy than to allow the illegal peddling of cigarettes to foster inside and outside its borders.

Thérèse Margolis can be reached at [email protected]