The trade in illicit products is a global headache, netting crime syndicates around US$650 billion (about R9 trillion) annually.
This is according to Alan Mukoki, chief executive officer of the South African Chamber of Commerce and Industry, who quoted from figures released at a World Economic Forum event earlier this year.
He was speaking at an anti-illicit trade gathering hosted by the chamber, the South African Informal Traders Association and the Gauteng Liquor Forum on 11 October about the dangers of trading in illicit products.
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Mukoki told a group of mainly informal traders gathered in the inner city that illicit products were normally produced in unregulated warehouses where workers are not protected in any form.
He said the production and sale of illicit products undercut their members, who are legitimate commercial entities and industries, and cost the economy billions in lost tax revenue.
“It’s a huge problem for our members. These illicit traders do not pay tax. We can’t talk to them about whether their employees are registered properly or if they follow the Labour Relations Act in how they treat their employees,” he said.
Mukoki urged the government to get tough on illicit trade as it was the springboard for other illegal activity.
“Many of the people involved in illicit trading are involved in other criminal activities such as money laundering, crime and drugs. Many of the people involved in the illicit trade are those who came here illegally and some are involved in peddling drugs and other illegal acts,” he said.
Bongani Mabuza, the provincial secretary of the Gauteng Liquor Forum, said the fight against illicit trade involved all sectors of the economy. He said such products were not only harmful to those who consumed them but aided syndicates to pursue other criminal activity.
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“Illicit trade is killing our economy; it is creating more unemployment; it is causing more poverty,” he said.
Mabuza said liquor traders were gravely concerned about illicit products being sold to the public as these had the effect of harming their customers and negatively impacting on their business.
“Are we also looking into the health factor? We sell cigarettes knowing they are not necessarily healthy but at least we know what is in the legal products. These illicit cigarettes, we don’t know what is in them,” he said.
Mampapatla Madikoto, the traders association’s general secretary, said the sale of counterfeit goods poses a serious health risk to consumers.
“These illegally manufactured products are a threat to the health of our customers because they are unregulated. This is why they are sold via the back door and often at ridiculously low prices,” he said.
The parties gathered signed a joint declaration, which bound all members to work with law enforcement authorities to root out illicit products. It also calls on communities to boycott illicit products and to report those who sell them.
