What Pricing Tells Us About the Nature of the Smuggling Business

IF THE HEAD of the International Organization for Migration (IOM), William Lacy Swing, is to be believed, people smuggling is the third largest global criminal industry, after arms and drug trafficking.

Swing recently claimed that people smugglers are making $35 billion (31 billion euros) a year from the Mediterranean migration crisis alone. While there are good reasons to be skeptical about the headline number, a better understanding of the mechanics of the smuggling industry is urgently needed.

Human smuggling is a business, one in which the marketplace is human aspirations: the demand for mobility, where no legitimate avenues exist or they are difficult to access, is met by smugglers.

In some cases, the service a smuggler offers is a lifeline. In others it is an opportunity to access economic opportunities that will provide generational returns. Moreover, this is a business only enriched by greater controls: the more dangerous and difficult the journey, the higher the fee smugglers can charge their clients.

As with any other marketplace, price matters. Our research at the and with our partner organization the Institute for Security Studies, Pretoria, into the political economy of migrant smuggling, shows very clearly how price-sensitive smugglers are to their environment and migrants are to the price being offered. We have spoken to migrants and smugglers in eight countries across sub-Saharan Africa, the Sahel, North Africa (including Libya and Egypt).

In one telling example, a migrant interviewed for an reported that during a football game, more than 1,000 migrants were smuggled from Turkey to Greece for a significantly reduced price – €900 instead of the usual €2,000 or more – because “the policemen were watching the game.”

Our most recent report, “An Integrated Response to Human Smuggling from the Horn of Africa to Europe,” a systematic analysis of price in three smuggling systems, highlighted how pricing can be used to predict how people are moving.

On Libya’s coast, for example, the price for a place on a smuggler’s boat has fallen consistently between 2013 and the present. Up to early 2014, it hovered between $1,000 and $1,500 but then began to slide sharply as rescue operations meant smugglers could shift their business model from genuine attempts at crossing the Mediterranean to Italy to merely trying to get to the rescue zone. A seat on a boat from Libya now costs $200 or less, with migrants offered free passage if they bring four or more paying friends.

Prices along the smuggling routes out of the Sudanese capital, Khartoum – the clearing house for all migrants from the Horn of Africa, including the troubled nations of Somalia and Eritrea – have been diversifying dramatically. For the popular route northward to Egypt, prices have reached almost prohibitive levels, from an average of $3,000 to nearly $5,000 per head.

Two factors explain this shift: first, growing diplomatic tensions between Sudan and Egypt have led to tighter controls on the Egyptian side; second, European Union political pressure and investment in Sudanese border control have resulted in punitive enforcement by the Rapid Support Forces (RSF), a controversial militia group made up of former Janjaweed fighters that was absorbed into Sudan’s national army exclusively to address migrant smuggling.

By contrast, prices for westward routes to Libya have fallen to a historic low: the nomadic groups controlling those routes are offering financial incentives to capture the declining Egyptian market. Travel from Khartoum to Libya’s coast is now a mere $1,000.

Also emerging from Somalia is a dangerous trend of “travel now, pay later” schemes offered by smugglers, where migrants put themselves in a position of indebtedness to their smugglers – increasing their vulnerability to abuse and exploitation, including long periods of bonded labor in their destination countries.

Despite the importance of price as an indicator of the market, there is no migration, refugee or law enforcement agency systematically collecting or analyzing data about pricing. In fact, few seem interested in understanding how the smuggling market works at all, save to tar smugglers as universally criminal and exploitative.

This is an oversight – it is like analyzing transport networks by only profiling the passengers, and not the bus companies that move them. In fact, monitoring pricing – not only how much is paid, but also where those payments are made along the route – could potentially offer huge insights into the dynamics of migration, including the possibility of anticipating large-scale surges in arrivals.

We need a new set of strategies to combat human smuggling and reduce the profits in the industry. This means moving beyond just border control and returns. Where mobility is restricted, then smugglers benefit.

Smugglers are the vector in contemporary irregular migration. They shape how and where people move, and how safe they are along their journey. It is time for all first-line respondents in irregular migration who are serious about protecting people on the move, not just to vilify smugglers but to understand how the smuggling industry works, to collect data about it and to identify the red flags that indicate consolidation of smuggling networks and the entry of more professional and virulent criminal groups.

This article was originally published on What Pricing Tells Us About the Nature of the Smuggling Business

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