Latin America and the Caribbean Strengthen Cooperation to Combat Illicit Financial Flows

The seminar, organized by ECLAC and UNODC in Santiago, Chile, brought together representatives from public institutions, international organizations, and academia to exchange experiences and strengthen regional coordination. The UNODC-INEGI Center of Excellence participated in the analysis of methodologies for measuring illicit financial ffows and emerging trends in drug and arms trafficking in Latin America and the Caribbean.

Santiago, Chile, September 9, 2026. “Criminal organizations operate in a flexible, transnational, and coordinated manner. While they rapidly connect markets, territories, and financial systems, our institutional responses tend to remain fragmented across different jurisdictions and areas of responsibility. This is a historical inertia that must be overcome,” stated José Manuel Salazar-Xirinachs, Executive Secretary of ECLAC, in his opening remarks.

Illicit financial flows and illegal economies pose a challenge to development, fiscal capacity, and governance in the countries of Latin America and the Caribbean. Their transnational nature and interconnection with legal markets make them difficult to identify and track, which requires strengthening institutional capacities and cooperation among countries and sectors.

In this context, the seminar “Illicit Financial Flows and Illegal Economies: Challenges for an Inter-institutional Cooperation Agenda” was held on September 8 and 9 in Santiago, Chile, organized by the Economic Commission for Latin America and the Caribbean (ECLAC). The meeting aimed to create a space for dialogue and the exchange of experiences to understand the economic and financial dynamics that sustain illegal economies, as well as to contribute to the development of an agenda for inter-institutional and regional cooperation.

Illicit financial flows facilitate the accumulation, circulation, and legitimization of funds derived from criminal activities. In addition to their implications for security, these dynamics can affect tax revenue, investment, productivity, economic competition, and trust in public institutions. The growing interaction between legal and illegal economies poses additional challenges for detecting these flows and understanding the mechanisms that enable their circulation and reinvestment.

During the seminar, various aspects related to the measurement of illicit financial flows, illegal markets, money laundering, institutional weaknesses, and the effects of organized crime on the region’s economies were addressed.

One of the central themes was the need to strengthen coordination among institutions with responsibilities in the economic, statistical, tax, customs, financial, security, and justice sectors. Coordinating these capabilities allows for a broader analysis of a phenomenon that transcends national borders and the purview of any single institution.

Information sharing, evidence generation, and the development of shared methodologies are key to identifying patterns, understanding the interactions between legal and illegal markets, and detecting the financial mechanisms that sustain criminal activities. Furthermore, cooperation among countries can help reduce information gaps and strengthen institutional responses to networks operating on a transnational scale.

The Center of Excellence for Statistical Information on Government, Public Safety, Victimization, and Justice, established by the United Nations Office on Drugs and Crime (UNODC) and Mexico’s National Institute of Statistics and Geography (INEGI), participated in the seminar’s first working group, which focused on measuring illicit financial flows by distinguishing between those derived from international trade and those generated by four drug markets, illegal mining, and migrant smuggling, as well as progress made in five countries in the region.

Adriana Oropeza, coordinator of the UNODC-INEGI Center of Excellence, spoke alongside specialists from statistical institutions in Mexico, Colombia, Chile, Peru, and Bolivia, among other participants. During her presentation, she outlined UNODC’s progress and tools for strengthening the production of statistical information on illegal activities and associated financial flows, as well as opportunities to improve their measurement through the coordination of information sources and institutional capacities.

Complementing the work on cocaine, marijuana, and migrant smuggling, Edgar Bustos of INEGI presented the experience of estimating illicit financial flows associated with methamphetamine and fentanyl. Building on the pilot project developed by the INEGI-UNODC Center of Excellence, the exercise adapts the methodological approach to substances with distinct market dynamics, target populations, and trafficking routes, combining multiple sources to estimate their inflows and outflows.

Among the tools presented are the Guidelines for Measuring Illicit Financial Flows Related to Illegal Activities, published by UNODC in 2026, which are based on the conceptual framework developed in collaboration with the United Nations Conference on Trade and Development (UNCTAD). These guidelines include models, priority variables, implementation guidance, and checklists to support the measurement of flows related to activities such as drug trafficking, the smuggling of migrants, and wildlife trafficking. They also contribute to efforts to measure Sustainable Development Goal indicator 16.4.1, which relates to the total value of incoming and outgoing illicit financial flows.

The presentation also highlighted pilot activities carried out in Latin America to advance the measurement of these flows, with initiatives in Mexico, Colombia, Peru, and Ecuador, as well as in a Central American country. The work covers markets such as drug trafficking, the smuggling of migrants, and illegal gold mining, and allows for the exploration of the information requirements necessary to characterize illicit activities and their economic and financial dimensions.

In addition, various UNODC data collection mechanisms that contribute to the analysis of these phenomena were presented, including the Annual Report on Drugs Questionnaire (ARQ), Individual Drug Seizures (IDS), the Questionnaire on Illicit Arms Flows (UN-IAFQ), and the Questionnaire for the Global Report on Trafficking in Persons (GLOTIP). These tools enable the collection of information on markets, actors, routes, seizures, and other characteristics of criminal activities, which can provide insights for their study.

The seminar also examined the relationship between economic growth, the expansion of illicit markets, and institutional capacities, as well as the impacts of organized crime on the economies of Latin America and the Caribbean. Furthermore, participants discussed the scope of a joint study proposed by ECLAC and UNODC to characterize and analyze the interactions between legal and illegal economies in the region.

Addressing these phenomena requires coordinated, evidence-based responses that integrate economic, statistical, financial, and security perspectives. Strengthening inter-institutional and regional cooperation is a key component in improving States’ capacity to detect illicit financial flows and address the challenges they pose to sustainable development in Latin America and the Caribbean.