Most Governments Not Well Prepared to Prevent, Address Illicit Trade – TRACIT
Most governments are not well prepared to prevent and address illicit trade, according to a 2025 Illicit Trade Index report launched by the Transnational Alliance to Combat Illicit Trade (TRACIT), ranking 158 countries on their national resilience against the global menace.
The index was launched during a special session of the First OECD Forum on Countering Illicit Trade, which brought together stakeholders committed to preserving the integrity of the rules-based international trading system.
This landmark event addressed one of the most pressing challenges to global trade: the emerging growth in illicit activities such as counterfeiting, smuggling, wildlife trafficking, trade-based money laundering, and the circulation of falsified and substandard products.
“TRACIT is pleased to be invited to launch our Index at the First OECD Forum on Countering Illicit Trade,” said Jeffrey Hardy, Director-General at TRACIT.
“The Index is essentially a diagnostic tool to help governments identify and remedy vulnerabilities to illicit trade. This provides a useful complement to OECD’s remarkable portfolio of best practices for countering illicit trade, and it leverages their commitment to advancing better policy in OECD member countries throughout the region.”
The OECD Forum created a dynamic platform to explore the latest evidence, best practices, and innovative strategies to counter illicit trade.
It featured a diverse lineup of enforcement officials, intellectual property experts, trade representatives, and industry leaders committed to identifying and implementing the best, most modern policy solutions available.
“We created the Forum to leverage the significant body of work produced by the OECD Working Party on Countering Illicit Trade,” said Dr. Piotr Stryszowski, Head of Unit, OECD Working Party on Countering Illicit Trade.
“The Forum provides a unique platform for us to highlight key strategic trends and evidence to OECD countries, while fostering dialogue with like-minded stakeholders committed to tackling illicit trade.”
Covering 158 countries—from emerging markets to advanced economies, the Index identifies vulnerabilities, strengths, and trends within national systems. By leveraging data-driven analysis and practical recommendations, it aims to strengthen policies, enhance enforcement, and promote international collaboration.
The average score of 158 countries is 49.9 / 100, and no country received a total score above 76. The range of scores is highest at 76 for the top performer Denmark and lowest at 25.7 for Yemen.
The top 10 performers are led by Denmark with a score of 76, closely followed by the United States (75.4), Germany (73.5), Finland (73.3), Norway (72.4), Canada (71.3), and Japan (70.9).
All of them are advanced economies with strong institutional frameworks. The bottom 10 performers—from the lowest scored—are Yemen (25.7), Venezuela (27.1), Central African Republic (29.7), Chad (30.3), Sudan (31.3), Burundi (31.5), Haiti (32.2), Equatorial Guinea (32.6), the Democratic Republic of the Congo (33.1), and Nicaragua (33.3).
These countries uniformly struggle with weak regulatory frameworks, inadequate border and customs controls, and, most critically, poor supply chain oversight, all of which create fertile ground for illicit trade networks.
These circumstances underscore deep-rooted challenges in governance, enforcement, and economic management. The findings present a stark reality: illicit trade is a widespread and persistent challenge, affecting both developed and developing nations alike.
While some countries demonstrate relative strength in regulatory frameworks and enforcement, systemic vulnerabilities remain prevalent across the globe.
“Perhaps the most revealing insight from the Index is the consistently low scores across the board, signaling that most governments are not well prepared to prevent or address illicit trade. Even the best performing countries show considerable room for improvement,” said Dr. Ulrika Bonnier, Director of Programs at TRACIT and the Index project team leader.
“Through the exercise of dissecting a country’s capacity to defend against illicit trade we have revealed key weaknesses, structural gaps and vulnerabilities that merit immediate attention and, hopefully, compel governments to design and implement effective countermeasures.”
The Index evaluates countries across six key categories, each assessing a critical aspect of resilience against illicit trade: Taxation and Economic Environment; Regulatory Framework and Enforcement; Criminal Enablers of Illicit Trade; Trade, Customs and Borders; Supply Chain Intermediaries; and Sectoral Illicit Trade Indicators.
While some nations demonstrate strength in specific areas, others struggle with systemic weaknesses, highlighting the uneven distribution of enforcement capabilities, regulatory frameworks, and governance structures.
Many countries exhibit strong performance in the category of Trade, Customs and Borders, which primarily measures a country’s ability to prevent the entry and movement of illicit goods.
While some countries have advanced systems and protocols in place, others face substantial challenges in enforcing border and customs practices. The lowest-scoring category, Supply Chain Intermediaries, evaluates a country’s ability to oversee and control supply chain hotspots vulnerable to illicit trade.
The proliferation of Free Trade Zones (FTZ) and the shift toward illicit activities in them, the rapid growth in the number and types of e-commerce platforms, and the dramatic increase in small packages flowing through global postal networks challenge governments to keep pace, modernize controls and upgrade the allocation of resources and technologies to address illicit trade.
“To effectively tackle illicit trade, governments need to work together with the private sector and civil society to create a stronger legal and regulatory framework that deters illicit trade, ensures fair market competition, and enhances consumer protection,” said Mr. Hardy.
“The path forward demands coordinated, sustained, and targeted reforms and a commitment to continuous improvement and international collaboration. We’re pleased to collaborate with OECD to facilitate this important work on a global scale.” Yield Slides on Post Auction Demand for Nigerian Treasury Bills
