Soaring Cocaine Shipments Weigh On U.S.-Colombia Alliance
Matthew Smith

In an inflammatory social media post, U.S. President Donald Trump accused Colombia’s first-ever leftwing President Gustavo Petro of colluding with drug traffickers, calling him “an illegal drug leader”. Trump, in an increasingly hardline stance, called for the cessation of U.S. aid and imposition of further steep tariffs on Colombia. He even went as far as threatening military strikes if narcotics trafficking does not end. This is testing the historically close alliance between the United States and Colombia, which is Latin America’s largest recipient of U.S. financial aid.

The latest spat comes after Trump decertified Colombia as a counternarcotics partner in September 2025, stating the country had “failed demonstrably” in its obligations to fight drug trafficking. Colombia’s rapidly growing cocaine output, which set a new annual record for the past ten years, is straining what was once a close-knit relationship between the White House and the Casa Nariño, Colombia’s presidential residence. By the mid-1990s, Colombia had overtaken Peru and Bolivia to become the world’s leading cocaine producer. As a result, the strife-torn country now supplies close to 70% of all cocaine consumed globally.

United Nations data shows Colombia’s 2023 cocaine output surged by a massive 53% year over year to an all-time high of 2,664 metric tons. This is a whopping nine times greater than the 290 metric tons manufactured a decade earlier and almost 30 times more cocaine than Colombia produced in 1993, the year notorious drug kingpin Pablo Escobar was shot down on a Medellin rooftop. Cultivation of the coca bush, whose leaves contain the alkaloid needed to produce cocaine, climbed to a record 253,000 hectares (625,176 acres) during 2023. This figure is 10% higher than a year earlier and five times the 48,000 hectares (118,610 acres) recorded for 2013.

Source: United Nations Office on Drugs and Crime

The sharp surge in the amount of land used to grow the alkaloid-rich coca bush began when then-President Juan Manuel Santos ended the aerial spraying of glyphosate for illicit crop eradication in May 2015. He made the controversial decision because a 2015 World Health Organization (WHO) report indicated that glyphosate is probably carcinogenic. Studies also link the herbicide to birth defects, Alzheimer-type diseases, and immunological disorders. 

Herbicidal drift was another long-standing issue with glyphosate aerial spraying, particularly because the herbicide persisted in the environment for up to 72 hours after application. When spraying coca fields, herbicide droplets would drift well beyond the target zone, destroying legitimate crops, damaging the jungle canopy, and contaminating water bodies. This was particularly problematic with the U.S. contractors charged with spraying glyphosate, showing little regard for the herbicide’s impact on local communities and the environment.

Another contributing factor to the rising volume of coca being grown in Colombia was Petro’s decision to reduce efforts to manually eradicate illicit crops significantly. Forced eradication, even after aerial coca fumigation ended, long formed the backbone of Bogota’s counternarcotics strategy aimed at suppressing cocaine production. During 2023, only 20,325 hectares (50,224 acres) of coca had been manually eradicated, a third of the 68,974 hectares (172,910 acres) destroyed a year earlier and a fifth of the 103,257 hectares (255,154 acres) removed during 2021.

Instead, Colombia’s president shifted strategy to pursue illegal armed groups, their leaders and finances rather than the poor peasants who maintain a subsistence living from growing coca. That plan resulted in a significant increase in narcotics seizures. For 2023, Colombian authorities seized 739,557 kilograms of cocaine, the highest volume ever. This represented a 12% year-over-year increase and was 5 times the 147,464 kilograms seized a decade earlier.

Source: United Nations Office on Drugs and Crime

While that is an impressive quantity of cocaine that was removed from global supply, it doesn’t tell the full story. You see, since 2012, when authorities interdicted 61% of all cocaine produced in Colombia, the quantity seized relative to total production has fallen substantially, as the chart below shows.

Source: United Nations Office on Drugs and Crime

The 739 metric tons seized by Colombian authorities during 2023 represent a mere 28% of all cocaine produced that year. This is the lowest amount relative to the volume of cocaine produced since 2007, when authorities intercepted 161 metric tons or 27% of that year's total output. This data suggests the total volume of cocaine exported from Colombia to principal consumer markets, the U.S. and Western Europe, is increasing. In that context, the White House's elevated level of frustration is easier to understand.

Soaring cocaine output sparked considerable speculation over whether the narcotic is a major contributor to Colombia’s economy. An academic paper valued 2023 cocaine production at $15.3 billion, making the illicit trade responsible for 4.2% of Colombia’s gross domestic product (GDP), which is significantly more than the 2.7% generated by petroleum, the Andean country’s largest export. This estimated $15.3 billion is nearly as much as the $15.8 billion earned by crude oil exports, making the narcotic Colombia’s second most valuable export during 2023, underscoring cocaine’s considerable economic clout.

The latest events couldn’t come at a worse time for a cash-strapped Petro administration. Trump’s decision to halt all financial aid to Colombia, totaling $232 billion for 2025, has removed a vital financial lifeline at a time when fiscal revenue is plummeting. The notable decline in fiscal revenue is exacerbated by significantly weaker production of Colombia’s main legal export, petroleum. Not only is Colombia’s crude oil production locked in a seemingly never-ending death spiral, negatively affecting a key source of fiscal income, but this problem is compounded by weaker oil prices and foreign energy companies slashing investment.

For these reasons, the Petro administration is facing a potentially debilitating financial crisis. Plummeting tax revenue and expenditures soaring to unsustainable levels, driven by the need to bolster security spending to counter growing lawlessness, are responsible for the fiscal deficit ballooning. For the first eight months of 2025, Colombia’s budgetary shortfall amounted to 5.1% of GDP, with economists, before accounting for the loss of U.S. aid, anticipating it will balloon to 8% by the end of 2025. 

The loss of U.S. aid is a tremendous blow for Bogota. For decades, Colombia has benefited from Washington’s largesse, receiving $6.8 billion over the last decade. This not only makes Colombia the largest recipient of U.S. aid in Latin America, but also makes it an important financial lifeline for the strife-torn country. This places greater pressure on already severely stretched finances, with the government unable to fund any sustained budget shortfall. This will only worsen if Trump hikes tariffs on imports from Colombia. The U.S. is the country’s largest trade partner, receiving over $14 billion, or 29%, of Colombia’s exports during 2024.

By Matthew Smith for Oilprice.com

 

 

 

 

 

 

Matthew Smith is Oilprice.com's Latin-America correspondent. Matthew is a veteran investor and investment management professional. He obtained a Master of Law degree and is currently located in Latin America. Matthew writes on oil and gas, mining and infrastructure.

 

 

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