Central America Receives a Major Boost to Fight the Consequences of Crime and Violence

June 19, 2012

  • International donors and multilateral institutions pledge US$1billion in financial and technical assistance.
  • The Central American region has become one of the hardest hit by crime in the world.
  • A 10% reduction in the homicide rate would boost annual economic growth by 1%.

Efforts to fight crime and violence in Central America received a major boost this week following billions of dollars in pledges from international donors and multilateral institutions.

World Bank regional vice president Pamela Cox announced more than US$1billion in financial and technical assistance to tackle insecurity in Central American countries at the International Conference in Support of the Central American Security Strategy held in Guatemala.

Cox noted that each country will be able to use these funds to address their most pressing crime and violence related issues. She explained that the Bank’s technical expertise will be offered mostly to strengthen national institutions.

"Protecting and promoting public safety has become a development priority for countries in Latin America and the Caribbean and, consequently, for the World Bank," Cox noted.

Other key players also chipped in. US Secretary of State Hillary Clinton announced that Washington's contribution to Central America’s security would be increased to US$300 million this year. The IDB also said it would increase its assistance to US$500 million.

On the world map of crime and violence, the narrow territory of Central America would amount to the size of all of South America or Europe. With an average of 14.257 homicides per year—nearly 40 a day— the Central American region has become one of the hardest hit by crime in the world, with countries like El Salvador, Guatemala, and Honduras showing the highest per capita homicide rates in Latin America.

Attempting to reverse this situation and tackle the issue of crime and violence on several fronts, Guatemala is hosting the International Conference in Support of the Central American Security Strategy, an unprecedented meeting of all Central American Heads of State and the Presidents of Colombia and Mexico, the U.S. Secretary of State and senior officials of the European Union, the Inter-American Development Bank, the Organization of American States, the Central American Bank for Economic Integration, and the World Bank.


" No entity by itself has the slightest chance of taking on a problem of the size the region now grapples with "

Pamela Cox

World Bank's VP for Latin America and the Caribbean.

Beyond the human suffering caused by all this bloodshed, the monetary value of crime and violence in Central American countries with high homicide rates represents about 8 percent of GDP, a figure that far exceeds the typical Central American budget for social programs, and hinders the region’s development agenda.

The conference will discuss the attending leaders’ commitment to the Regional Public Safety Initiatives proposed by the Central American Integration System [Sistema de la Integración Centroamericana SICA], which will be presented at the forum.

Cox explained that "the negative impact (of crime and violence) on the social fabric, institutions, investment climate, as well as the ability of governments to meet social needs is profound." She added that this problem can only be tackled through comprehensive and coordinated efforts since "no entity by itself has the slightest chance of taking on a problem of the size the region now grapples with."

How do Crime and Violence affect Central America’s development?

The situation is especially grave in countries like El Salvador, Guatemala and Honduras, which have experienced increased levels of crime and violence in recent years and has become a serious concern for Costa Rica, Nicaragua and Panama. The cost of crime and violence— as measured in years of life lost to disability—is about 2 percent of GDP in El Salvador, 1.4 percent in Guatemala, and 1.3 percent in Honduras. In the commercial sector, the costs and losses related to security in Central America (excluding Costa Rica) averaged 3.7 percent of total sales.

The conditions in some areas of El Salvador, Guatemala and Honduras are so extreme— almost one homicide for every 1,000 people—that they undermine the hopes for peace and stability that emerged after the resolution of regional civil wars. In the other three countries in the region -Costa Rica, Nicaragua, and Panama- the levels of crime and violence are much lower, but a recent increase has given rise to considerable concern.

World Bank Support to Central America

A recent World Bank regional study on the subject points to drug trafficking, juvenile delinquency, and the widespread availability of firearms as the major catalysts for crime and violence in the region. All these factors are compounded by weak criminal justice institutions. The study also suggests that a 10 percent reduction in the homicide rate in the most violent countries in the region would boost annual economic growth by one percent.

As a body with experience in development, the World Bank draws on its various resources through its analytical work, operations, technical assistance, training, and partnerships. The result of this work is exemplified by the Barrio Ciudad Project [Proyecto Barrio Ciudad] in Honduras, which seeks to improve shanty towns in urban areas, or the Judicial Reform Project [Proyecto de Reforma Judicial] in Guatemala, which seeks to eradicate the causes of crime and violence.