Once The Richest Man In The World, Here's How Pablo Escobar Makes Money From Drugs

As one of the richest people in the world, Pablo Escobar financially supports the football club Atletico Nacional. (Eurosports)

JAKARTA – Having a profit of up to 420 million US dollars or around Rp. 6 trillion per week, it is not surprising that Pablo Escobar was once included in the list of the richest people in the world. How can he make that much money?

The total wealth of the criminal figure, nicknamed Raja Kokan, until his death on December 2, 1993 was estimated to be no less than IDR 358.9 trillion. All the result of Escobar's control of 80 percent of the cocaine market in the United States in the 1980-1990s.

Cocaine is one of several commodities that before consumption must go through cultivation, processing, and distribution. The export value of cocaine in the world is actually only half that of coffee, as a fellow commodity that begins with cultivation before consumption.

Pure cocaine, Pablo Escobar's main source of money that made him one of the richest people in the world. (NDTV/mentahelp.net)

But when it comes to retail, cocaine is up to 300 times more expensive than coffee per gram. Calculating the income of the illegal cocaine business is much more complicated than coffee.

Colombia, Peru and Bolivia are the main producers of the coca plant as a raw material for cocaine. After being processed into ready-to-sell cocaine, usually the drug will transit in Caribbean countries or Central American regions such as Mexico, Guatemala, Honduras, Nicaragua, or Panama before reaching the United States. Payment for such goods is made in the country of transit.

All walks of life enjoy the money from the cocaine trade. Starting from poor farmers who grow coca in the mountains, drug dealers such as Escobar, police, soldiers, to politicians. Money from cocaine is very influential on the economy in South America, or so-called narcodollar.

Coca Harvest and Cocaine Yield

Coca leaves are harvested three to six times a year. In a year, one hectare of coca land produces an average of 1 tonne of leaf harvest. If then processed into cocaine, then 135 kg of leaves will produce 0.5 kg of cocaine. The coca plant begins to be harvested at the age of six months, and will end when the plant reaches 30 years of age.

According to Drug Enforcement Administration (DEA) data, Colombia is actually not the largest coca-producing country. Peru produces 60 thousand tons of coca leaves per year, followed by Bolivia with 50 thousand tons. Colombia only produces 15 thousand tons of coca leaves a year, but the country of Escobar has the largest cocaine production in the world.

As much as 60 percent of cocaine production in South America comes from Colombia. The DEA provides an illustration of the capital of cocaine production, and the profits made after the goods are finished.

Daud coca is the main ingredient in making cocaine, a business that Pablo Escobar has been in for decades. (Esquire)

From the case of cocaine production in the Cauca Region, Colombia, to produce 40 grams of coca paste (semi-finished cocaine), a capital of 46 US dollars or around Rp. 66 thousand is required. Coca paste sells for 1.5 US dollars per gram, so 40 grams of pasta will bring you almost Rp. 900 thousand. So you can imagine the profit that a drug dealer gets if he sells pure cocaine. Especially if the city is in the same class as Pablo Escobar.

In Escobar's heyday, in Bogota a sack of pure cocaine (about 10-20 kg) sold for 8 thousand US dollars. But when it was sold to a city in the United States, the price jumped to 30 thousand US dollars per kilogram. Whereas at the retail level, pure cocaine is still mixed again so that the maximum purity is only 50 percent. Generally even below 50 percent.

Production Never Drops

Escobar was dead, but that didn't reduce Colombia's production of cocaine that was exported to the United States. Even according to the DEA report, the number continues to rise. In 2016 cocaine exports from Colombia to the United States reached its highest point, which was 910 tons.

“Through 2018, the United States will likely continue to experience the highest increase in cocaine supply and use in a decade. Colombian cocaine production will also continue to increase, at least into 2017. This is because the coca plants planted in 2016 are ready to harvest, as well as the constant incentives from cities to farmers to continue growing coca,” the DEA statement said in the Colombian Cocaine report. Production Expansion Contributes to Rise in Supply in the United States 2017.

Semi-finished cocaine or what is known as crack. (US Drug Enforcement Administration)

Tom Wainwright, author of Narconomics said that eradicating drugs is not the best option and will be futile. Wainwright actually suggested that the trade of all kinds of drugs should be controlled by the government of a country.

“In my opinion, our choice today is not a world with drugs or without drugs. The best option in my opinion is that the distribution and use of drugs should be controlled by the government by being prescribed by a doctor. Rather than the world having to deal with the mafia, I think the first option is much better," Wainwright wrote in Narconomics.

Escobar and his associates may call their business a cartel. But instead of controlling prices and supply, their behavior is more suitable to be called a criminal syndicate. They pump a relentless supply of drugs into the market, and let the market set the price.

No wonder Pablo Escobar has a lot of money, so he is placed as one of the richest people in the world.