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Failing states in Central America

When the US Defence Department produced a report in December in which it named Mexico as one as one of two countries (along with Pakistan) at risk of rapidly becoming a failed state there was a predictable rejection of its findings in many quarters. In fact, the authors may have got their analysis right, just for the wrong country. Head further south to Central America – Guatemala in particular – and the failed state paradigm may be far more applicable.

Considering the apparent progress made by democracy in the region since the 1990’s, this assessment may seem a little harsh. But dig a little closer to look at the quality of democracy, above all in the condition of state institutions such as the judiciary and the police, and the picture becomes less rosy. Ironically, it is Mexico’s hardline strategy against the drug cartels on its own territory which is making the situation worse; gangs are seeking the relative sanctuary of Central America as a base for their operations.

The evidence from Guatemala is particularly worrying. Some 80% of Latin American cocaine reaching the US passes through the country at some point. President Álvaro Colom in February claimed that 40% of the 6,200 murders recorded in 2008 were linked to drug-related violence. Investigators from the US and Guatemala believe that the two biggest Mexican cartels, the Sinaloa and Gulf gangs, are spreading their tentacles across various departments; the Gulf cartel’s notorious armed wing, Los Zetas, is held responsible for a spate of massacres in the country in the past year. Many economists believe that a major reason for the quetzal’s strength against the dollar in recent years has been the amount of drug money laundered through the Guatemalan financial system.

Compared with the strong-arm tactics employed by his Mexican counterpart Felipe Calderón, Colom seems resigned to defeat. Comments in January that the country was helpless against an ‘avalanche’ of drug-trafficking from the north were aimed at securing international support, but do little to inspire confidence in his leadership.