Despite being the principal transatlantic shipping point for cocaine, the recent report from the United Nations Office on Drugs and Crime (UNODC) notes that Brazil only accounted for 7 percent of South America's cocaine seizures from 2009 to 2014.

Santos port, located in São Paulo state, is a crucial link in South America's principal drug trafficking transit routes, with estimates suggesting that as much as 80 percent of cocaine arriving in Europe transits through this regional shipping hub.

In Santos, a network of small drug trafficking groups linked to the First Capital Command(Primeiro Comando da Capital - PCC), one ofBrazil's largest organized crime groups, traffic cocaine, marijuana, and methamphetamines to Europe, Africa, and Asia.

From its base in São Paulo, the PCC oversees a large percentage of drug trafficking from production areas in Colombia, Paraguay, Peru andBolivia, to supply both domestic and international markets. Drugs first transit through various Brazilian states like Mato Grosso, Mato Grosso do Sul, and Amazonas, before ending up on the streets of Brazil's major cities or being trafficked abroad via the country's ports. The PCC reportedly traffics around 40 tons of cocaine a year worth approximately $60 million primarily through Santos port. 'Ndrangheta, the Calabria-based Italian mafia group, is reportedly one of the PCC's most important international commercial partners.

PCC Power Continues to Grow

Despite various police operations against the PCC and smaller drug trafficking groups operating in Santos and further up the supply chain, drug trafficking remains a major problem at the port. However, drug trafficking at Santos port seemingly dipped following a federal police sting in March 2014, in which 23 PCC-linked drug traffickers were arrested and 3.7 tons of cocaine seized.

Last year, only 1.5 tons of narcotics, including cocaine and methamphetamines, were seized by authorities at the port, compared to roughly four tons in 2013 and 2014. It is unclear whether this is attributable to a decrease in drug trafficking via Santos port, or alternatively, less effective drug enforcement and screening measures. As the data from the UNODC report was collected between 2009 and 2014, it likely does not factor in the impact of the 2014 federal police sting, rendering the verification of the effectiveness of police operations premature.

Nevertheless, drug shipment seizures continue to be reported on a regular basis at the port. In a recent raid in June, federal police seized 700 kg of cocaine concealed in a shipping container bound for Belgium. Furthermore, the PCC appears to have significantly expanded its reach in Brazil despite numerous security operations against its illicit activities.

According to an Estadão de São Paulo report, PCC now has a presence in all 27 Brazilian states, in addition to bases in Argentina, Peru, Colombia and Venezuela. In addition, a recent Folha de São Paulo report highlighted how the PCC joined forces with the Rio-based Red Command (Comando Vermelho) to oust a rival drug trafficking group that controlled the drug trade from Paraguay to Brazil.

Growing Bolivia-Brazil Cocaine Trade Feeding Santos

The growing Brazil-Bolivia border drug trade has recently come under increased scrutiny, particularly as Bolivia provides one of the closest and direct sources of cocaine for drug-traffickers at Santos port. According to an El Deber report, Bolivia's Santa Cruz department, which lies adjacent to the Brazilian states of Mato Grosso and Mato Grosso do Sul, is currently the dominant cocaine-producing and trafficking area in that country.

Brazilian and Bolivian authorities recently launched a new multinational drug enforcement agency tasked with combating the cross-border drug trade. In late June, this produced results when a joint Brazilian-Bolivian police operation dismantled a drug trafficking group moving approximately two tons of cocaine a month from Puerto Quijarro in Santa Cruz to Santos via Mato Grosso do Sul state. The group reportedly relied on a fleet of 70 trucks to transport the drugs to the port.

Corruption and Bribery at Port Facilities

Corruption is a key facilitator for the PCC drug shipments out of Santos port. The way in which port operations in Brazil are structured and organized renders them a soft target for groups like the PCC that retain significant financial muscle, local influence, and can rely on a network of an estimated 11,000 members. A large percentage of drug trafficking at Santos port involves the smuggling of cocaine and other drugs into cargo ship containers or into the ship storage compartments themselves.

Traffickers reportedly also smuggle drugs onto container ships anchored in the bay using speedboats, and are often aided by corrupt crew members.

One of the principal vulnerabilities in Santos is that cargo can be stored for several months in privately managed export storage sites known as Recinto Especial para Despacho Aduaneiro de Exportação (REDEXs). There are over 47 of them in Santos alone, each managed by a different company. A lack of an overarching authority and weak information sharing among REDEX authorities is likely exploited by the PCC and other drug trafficking groups.

According to some reports, corruption and bribery is commonplace among officials and employees working at these facilities. In the 2014 federal police sting, an official working at a REDEX facility in Santos was arrested for allegedly supplying PCC leaders with information on ship arrival dates, routes, and types of cargo. The investigation alsorevealed that complicit port workers and customs officials were paid $1,500 for facilitating the movement of drugs onto container ships. In March 2016, two port security guards were arrested and charges with facilitating drug trafficking at the port.

Collusion between corrupt police officers and drug traffickers is also a significant problem at the port. In late June 2016, police arrested 13 members of a PCC-linked drug trafficking gang operating in the area. They reportedly operated with the complicity of several military police officers and potentially a local authority councilor. 

InSight Crime Analysis

Sources consulted by InSight Crime confirmed that transnational drug trafficking continues largely unabated at Santos port, and that the PCC remains the dominant player. A port security manager working at Santos who asked to remain anonymous told InSight Crime that drug trafficking is back to the same levels witnessed prior to the 2014 federal police sting. He noted that "current investment in security at the port is hampered by bureaucratic requirements, and, in practice, is not sufficient to counter the drug trafficking threat."

Regarding corruption and bribery practices within the REDEXs, the port security official noted that "while it is hard to prove that it exists, there is definitely a feeling that it is there, particularly among security guards that handle the containers."        

Beyond private security enforcement in Santos' REDEXs, questions need to be asked about Brazil's overall enforcement capabilities. In Brazil, drug enforcement is decentralized and convoluted. Each of Brazil's 27 states has one or more drug enforcement bodies, some larger and better-financed than others. For example, São Paulo state's drug enforcement institution, the Department of Narcotics Investigations (Departamento de Investigações sobre Narcóticos - DENARC), is well-financed and is considered more effective than many other state-level drug enforcement units, albeit not free of corruption.

In addition, the General Office for Narcotics Prevention and Repression (Coordenação-Geral de Prevenção e Repressão a Entorpecentes/DF - CGORE/DF) is a federal police unit charged with overseeing drug enforcement on a national level. And the navy regularly conducts surveillance and raids. A lack of cooperation between the various drug enforcement units is one of the major flaws in Brazil's national drug enforcement strategy.

As such, the July launch of the inter-institutional Brasil Central Seguro drug enforcement operation in six states produced immediate results and demonstrated the potential effectiveness of national-level cooperation on drug enforcement. The Michel Temer interim government has indicated that additional national-level drug enforcement operations are likely, with the new minister of Social Development, Osmar Terra, recentlycalling for increased border control and stricter penalties for drug trafficking.

However, rather than increasing enforcement, policy think tanks like The Brazilian Platform for Drug Policy (Plataforma Brasileira de Política de Drogas - PBPD) continue to question the effectiveness of the Brazilian government's so-called "war on drugs." In an email correspondence with InSight Crime, PBPD Coordinator of Institutional Relations Gabriel Santos Elias said Brazil's "war on drugs has failed because it's essentially based on repression, without focusing enough on education and prevention, as well as the general health of drug users in Brazil."

Over and above cooperation among the various state-level drug enforcement agencies, Elias pointed out that there is a fundamental conflict in strategy between the National Drug Policy Secretariat (Secretaria Nacional de Política de Drogas - SENAD), the federal government drug policy institution which "traditionally defends a more integrated approach to Brazil's drug policies," and "the security forces who suppress drug use without understanding SENAD's policies."

Noting that no country has ever successfully applied enforcement to reduce drug use or trafficking, Elias and the PBPD advocate for Brazil to pursue a policy based on regulation and education in cooperation with both the regional and international communities.

Either way, it is clear that Brazil's drug enforcement agencies and policies require a fundamental overhaul to reduce bureaucracy and increase both internal and external cooperation. As long as Brazil's drug policy enforcement hinges on a disjointed and decentralized system, and jars with the increasingly pro-regulation policies espoused by some regional neighbors, groups like the PCC are likely to continue to expand their national and international reach.

*Lloyd Belton is a political and country risk analyst at the consulting firm S-RM.