Dec 22, 2022

A Closer Look At Contraband: A Special Report, Part 2

Last evening, we showed you how contrabandistas smuggle illegal beers, perishables and other illegal goods across the northern boundary – the Rio Hondo. As Customs Officer Adrian Rancharan shared, they use the roughly ninety-mile stretch of the river to bring across the contraband goods via boats and small ferries that are provided by Mexican residents who live on their side of the river. In Part Two of our special report tonight, we look at how the illegal trade negatively impacts legitimate businesses, how easy it is to purchase contraband beers on the Belizean side of the river, and what is done with the goods that are confiscated. Here’s News Five’s Marion Ali.

 

Marion Ali, Reporting

One week after we accompanied an anti-contraband patrol on an operation in Santa Cruz, we returned to see if it was possible to find Mexican beers. Sure enough, it was. After inquiring around the village, we were guided to where we could go. While no one admittedly sold the beers, we found a house that had Dos Equis, mas fria. Unbeknown to the contraband agent, we recorded the purchase, though he never showed his face.  It is possible that he didn’t recognize us through his window, as we approached the property.

 

Marion Ali

“Hi, yoh have Mexican beers?”

 

Contrabandista

“Yes ma’am.”

 

Marion Ali

“Can I get two please, ice cold. Thanks”

 

Contrabandista

“Okay, gimme a second.”

 

Marion Ali

“How much for it?”

 

Contrabandista

“Five dollars, Miss.”

 

Marion Ali

“Wow! Thank you very much; your five dollars, Sir. I just got these two Dos Equis Mexican beers from a residence in Santa Cruz Village – contraband stuff.”

 

The illegal trade creates unfair competition for legitimate businesses that pay their taxes, such as Madisco, which faces major competition with the sale of contraband cigarettes; the illegal trade literally threatens its employment list.

 

Parveen Williams, General Manager, Madisco

“The last study that we did, which was last year, contraband accounted for thirty-five percent of the market, which has grown ten percent in at least two years.The illicit market definitely cuts into the sales of our company and as such, will cut into the livelihood of all these employees from Madisco.”

 

Marion Ali

“How much would you say you’d need to let go?”

 

Parveen William

“I would say I would lose more than half. Cigarettes are our main income earner for Madisco.”

 

Bowen and Bowen Limited, is one of three breweries in Belize. B&B are bottlers of Coke, Fanta and Sprite soft drinks. The company’s national Sales Director, Rocio Jimenez and finance manager, Earlette Rosado explained that the competition that the contraband trade creates for them also threatens their staff’s pockets.

 

Rocio Jimenez, National Sales Director, Bowen & Bowen Beverages

“My guys out in the street live off commissions so it’s every case they sell they get some money so for every case they don’t sell it’s affecting their pockets.

You know the less money they make the less they could provide for their families.”

 

Earlette Rosado, Finance Manager, Bowen & Bowen Beverages

“With less revenues, you have to think about it from the side that there is less jobs – less job availability. There’s less than we can do in our community.”

 

James Brodie and Company Limited imports detergents and toiletries for sale on the local market.  According to Roger Reyes, the company’s general manager, It is also feeling the pinch due to the contraband trade of these items.

 

Marion Ali

“Which of the items would you say contraband affects the most?”

 

Roger Reyes, General Manager, Brodies Northern

“Detergents, cleaners, and soap powders, toilet paper, those are the main ones that you see people contraband. And it affects our business, noh.”

 

Marion Ali

“How bad?”

 

Roger Reyes

“Minimally, it would impact us about a million dollars a year. This is just one area we’re focusing on. There are much more than just the few items that I mentioned.”

 

But there’s a very real reason why people engage in smuggling. According to Juan Diaz, chairman of Santa Cruz Village, there’s no other available means of income.

 

Juan Diaz, Chairman, Santa Cruz Village

“I could say it’s like forty percent of the people working on that because of work, no work.”

 

But while the contraband trade creates a livelihood for those engaged in the illicit activity, it has an inverse effect on legitimate businesses, either in the social programs they sponsor, or in keeping as many employees on the payroll.

 

Roger Reyes

“We cannot do many programs as we would like to do because of the loss of revenue, for example, giving our employees compensation and incentives, things like these noh.”

 

Parveen Williams

“If contraband accounts for thirty-five percent of the market, then imagine how much of the government’s revenue is lost.”

 

Earlette Rosado

“What we found out is that the government loses approximately ten million dollars in revenues within an average year and this is just on soft drinks and beer.”

 

We were unable to get actual figures on the overall estimates in losses to the local economy from any government ministry or department. We reached out to senior officials at the Ministry of Economic Development, but they did not have the data we requested. Even the prime minister did not have those figures when we inquired. And this highlights another area where the government needs to focus more attention on collecting relevant information on how much the country loses through contraband activity. The Statistical Institute of Belize did report a significant increase in the sale of beverages and cigarettes during the closure of the border due to COVID. It showed that growth in sales of these items jumped by more than twenty-three million dollars, from nineteen point three million to forty-three million dollars from June 2020 to June 2021.

 

During the same closure of the borders, law enforcement officers confiscated a number of boats believed to be used in the ferrying of contraband goods into Belize. Commissioner of Police, Chester Williams led the charge.

 

File: May 26, 2020 Chester Williams, Commissioner of Police

“There are a number of boats that you can see in some corner over there that were being used to run contraband. We have some degree of control over them now so to some extent we have disabled the people who are doing the contraband but there is still many blind spots in the area that need to be monitored.”

 

And when we spoke with the Bowen and Bowen National Sales Director, her comments also corroborated the report that sales within the business community went up when the borders were closed.

 

Rocio Jimenez

“Across the board we had expected a sales dip. So we started seeing the north, for some reason, having that increase in sales and we were like “Ok, what’s happening?” You know, we have the restrictions, so they should have gone down in sales but we’re starting to see the peak so attributed the majority of that coming from the closure of the border and the contraband.”

 

While there are people who justify contraband activity, C.E.O. in the Ministry of Agriculture, Servulo Baeza advises that purchasing perishable contraband items can literally wipe out an entire sector.

 

Servulo Baeza, C.E.O., Ministry of Agriculture

“There’s an outbreak of Avian influenza right in Mexico right now. If people are bringing in, let’s say eggs or chicken from Mexico contaminated into Belize, it could affect our whole poultry industry, putting in danger our food security. We don’t even know what all kinda chemicals these things are bringing in. So that’s another aspect. When it’s coming through BAHA, there’s a protocol established already where these products are certified.”

 

When they are lucky to land a successful interception and confiscation, the perishables are distributed to charitable institutions. The beers, well, those are destroyed.

 

Adrian Rancharan, Customs Officer, Orange Walk District

“Especially the perishables, we donate it most of the time to the hospitals, children’s home, old folks home. The beers itself, we have a warehouse and whenever we have a nice amount, we have bulldozers. We hire the bulldozers or dig a hole and mek dehm mash it up. So we destroy it. That is one way, the next way is we normally do a list and we send it to Belize City and hand it over to the Queen’s bond with a list saying this is all the stuff we got here. We hand it over to them then they dispose of it.”

 

People who are caught on public transportation are not normally fined, since the goods are normally just left on the seats and that would make it difficult to prove their owners. But the occupants of private vehicles, who are charged, mostly opt to settle their fines out of court, than to go through an entire trial and face having to pay three times the value of the goods that they were found with. But even these penalties do not phase contrabandistas.

 

Marion Ali (Stand Up)

“The contraband industry in Belize will continue to thrive unless and until there are adequate investments made in the operations that our law enforcement authorities conduct in these problematic areas along Belize’s borders. Marion Ali, News Five, Blue Creek Village, Orange Walk.”