Criminal Activity Cost Mexico Almost $250 Billion Last Year, Close To 20% Of Its GDP

Criminal activity in Mexico cost the country close to $250 billion last year, a figure equivalent to around 18% of its GDP, according to a new study.

The report, published by the Institute for Economics and Peace, specified that the cost amounted to $245 billion. It added that even though its index saw a moderate improvement in peace (0.7%), a surge in military spending (39%) increased the costs associated with violence.

The main factor driving the costs was the homicide rate, which clocked in at 19.3 per 100,000 people, a slight decrease compared to the year prior. Disappearances, however, increased sharply. There were over 13,000 people reported missing last year, a 36% increase compared to 2024.

The scenario varies sharply from state to state. Colima's murder rate, 101 per 100,000 people, erased nearly 41% of per capita income. Similar dynamics were reported in Tabasco, where violent conflict linked to criminal rivalries raised the economic cost of violence by 68% in one year. Zacatecas saw a decrease in violence, but the authors of the report credit that to "intensification of violence elsewhere."

The report also noted thar the fragmentation of criminal groups is a major source of instability. The arrest of Sinaloa Cartel leader Ismael "El Mayo" Zambada in July last year catalyzed violent conflict in that state, as a faction still loyal to him continues to battle one led by the sons of Joaquin "El Chapo" Guzman.

To reach the final figure, the report calculates direct and indirect costs of homicides, including funerals and lost wages for those killed. The cost of criminal activities including drug trafficking, extortion and gun crime is also taken into account, as well as government spending and private security hired by citizens. Finally, the report calculates losses from having to use resources to fight crime instead of other, more productive uses.