The Fall and Rise of Cocaine

In 1992, Peru produced an estimated 60 percent of the world’s cocaine. At one time, cocaine production was the largest industry in the country, at 17 percent of Peru’s GDP. It provided between four and six billion dollars in revenue to Peruvian drug trafficking organizations. Unlike the Colombians, Peruvians and Bolivians seek to control every stage of production based on familial association, and they use foreign crime networks for export and distribution. The Colombians use a vertical monopoly over production. This is a key difference between the principal cocaine producing countries in Latin America. 

Prior to the 1990s, coca production was a small-scale operation in Colombia.  Peru and Bolivia dominated coca production in the 1980s and early 1990s. A shift in production capacity from Peru to Colombia began to occur when former Peruvian President Alberto Fujimori started his “air bridge” campaign to shoot down trafficker aircraft transporting coca base to conversion laboratories in Colombia. Furthermore, Peru initiated aggressive government enforcement operations to combat the drug trade, which had a significant impact on production. As a result, the two dominant drug trafficking organizations, the Medellin and Cali cartels, began to promote the cultivation of coca in Colombia. In 2000, Colombia had approximately 163,000 hectares of coca cultivation compared to 43,000 hectares in Peru.  Bolivia was a distant third. Amazingly, by 2004, Colombia was responsible for 80 percent of the world’s cocaine.