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Drug Cartels Extorting And Controlling Businesses In Mexico

Investigators collect evidence at the site where Julio Cesar Almanza, president of the Tamaulipas Chamber of Commerce, was killed in Matamoros, Mexico, Tuesday, July 30, 2024. (AP Photo/Veronica Cisne

Drug cartels in Mexico are increasingly targeting large corporations, with even high-ranking business leaders facing threats and violence. The head of a business chambers' federation in Tamaulipas state was shot to death after speaking out about cartel extortion in the region. This incident highlights the pervasive issue of criminal groups demanding extortion payments, which has become a common practice in Tamaulipas.

Recently, Femsa, Mexico's largest chain of convenience stores, closed all its stores and gas stations in Nuevo Laredo due to gang-related problems. The company had been facing demands from cartels to buy fuel from specific distributors, and the situation escalated when gang members abducted store employees to gather information.

Cartels are targeting various industries, including agriculture, fishing, mining, and consumer goods, exerting control over sales, distribution, and pricing. This interference distorts Mexico's economy, with cartels dictating who can sell products and at what price, often demanding a percentage of sales revenue in return.

Extortion demands and violence against business leaders are increasing.
Drug cartels target large corporations in Mexico.
Femsa closed stores in Nuevo Laredo due to gang-related issues.
Cartels control sales, distribution, and pricing in various industries.

The American Chamber of Commerce reported that organized crime has partially taken control of goods' sales, distribution, and pricing for 12% of its members. Companies are facing attacks on trucks carrying products, extortion demands for protection payments, and significant security expenses, with some allocating up to 10% of their budgets for security measures.

Femsa is in talks with authorities to ensure the safety of its employees and reopen stores in Nuevo Laredo. The expansion of cartel income sources includes extorting money from companies and taking over legitimate businesses, such as controlling iron ore exports, manipulating crop prices, and even providing internet services for a fee under threat of violence.

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