U.S. President Obama’s final stop on his Latin America tour will be in El Salvador. A country that not long ago found itself torn by civil war, President Obama will see the El Salvador of today that is celebrating a thriving democracy headed by President Funes, who has one of the highest approval ratings in Latin America. Below we provide background and analysis on key issues that are likely to emerge during President Obama’s stop in El Salvador.
The Washington Office on Latin America (WOLA) will be following President Obama’s trip to the region and our experts will be available to provide analysis throughout. For an overview of what to expect as the President visits a rapidly changing region, check out our new podcast.
Why is the President visiting El Salvador?
1) President Obama’s stop in El Salvador shows that the U.S. can have a constructive and positive relationship with governments of all stripes. While at the Summit of the Americas in Trinidad and Tobago in April of 2009, President Obama vowed to change U.S. relations with the region, treating Latin American neighbors as equals, including countries with which we have disagreements. Despite this initial promise, it has not dedicated much attention to positively changing the dynamic of the U.S.’s engagement with its hemispheric neighbors. However, the U.S. has been effective in building a positive and constructive relationship with the Funes Administration. President Funes, representing the FMLN, the party of former guerrillas with which the U.S. has an unfortunate history, is a new style of leader who breaks out of the old mold of polarized politics and has focused his efforts on pragmatic, reform-oriented policies that are good for the country. President Obama’s stop in El Salvador will highlight the U.S.’s willingness to work positively with regional leaders like Funes.
2) A Latin America trip needs to include a stop in Central America. El Salvador has several key advantages. El Salvador has experienced a relatively smooth democratic transition, with elections in 2009 that brought the party of the former guerrillas to power. In contrast to Honduras, where a coup d’etat overthrew a populist and left of center president, Guatemala, where a complicated electoral scenario looms in the fall, and Nicaragua, where President Daniel Ortega has been approved to run for re-election by a questionable court decision, El Salvador saw a peaceful change of leadership from the traditional right to the left. The new government, though left of center, has maintained a largely positive relationship with the United States. There are close ties between the hundreds of thousands of Salvadorans who live in the U.S. and those in the country, ties which are easy to spotlight. Finally, President Funes is pursuing a reform agenda – a focus on economic growth that attacks poverty in the poorest communities, modest improvements in social welfare, and institutional reforms to the police and justice system – with which the Obama Administration is comfortable.
What are the objectives of the trip?
The Administration will pursue three objectives in the trip:
1) As noted above, it will seek to highlight the positive relations between a left of center government in Latin America and the United States;
2) It will focus on U.S. support for economic growth and poverty reduction in El Salvador. The President will highlight USAID programs, El Salvador’s inclusion in the BRIDGE Initiative, which seeks to channel remittances through the banking system, and U.S. support for Salvadoran initiatives to reduce poverty and stimulate development.
3) It will focus on U.S. support for efforts to combat organized crime and drug trafficking. The President will highlight U.S support, through the State Department and USAID, for efforts to strengthen the ability of the police to combat organized crime and drug trafficking, and U.S. support for violence prevention programs, especially programs that work with youth. The President will also highlight the ways in which the United States seeks to work with other donors, like Spain and the European Union, to maximize the effectiveness of international assistance.
What’s happening with the Salvadoran economy?
Unlike the United States, much of Latin America has endured the financial crisis well due to relatively strong regulatory frameworks for their banking systems and economic ties to countries beyond the United States. Many Latin American countries also benefitted from the rising price of agricultural goods and raw materials on world export markets. This is not the case with El Salvador. Closely linked to the U.S. economy through trade, dollarization, and remittances, the Salvadoran economy shrank by 3.5% and while growth was restored in 2010, the economy grew by only 1.2%. Compounding the crisis, Salvadoran businesses have chosen to send their money abroad rather than invest in their own country in contrast to entrepreneurs in other parts of Latin America.
Overall, more than 30% of the country lives below the poverty line; according to the United Nations Development Program more than 40% of the country is underemployed. As a result, outmigration continues to be high – some sources report that 700 Salvadorans leave the country each day.
The new Salvadoran government has developed targeted programs to bring employment and development to some of the poorest communities in the country, and has moved to strengthen some social service programs. It is also seeking a fiscal pact that will increase tax rates and make more resources available for government programs.
Booms in the prices of raw materials have driven transnational mining companies to explore metal mining projects in a number of countries in Latin America. This includes the Canadian-based mining company Pacific Rim that had a permit to do exploratory gold mining in northern El Salvador. Largely due to local and national opposition to the social and environmental consequences of mining, the Ministry of the Environment and Natural Resources never granted the company an exploitation permit and there is currently a moratorium on mining exploration in El Salvador. Pacific Rim, using a U.S. subsidiary, filed a suit against the government of El Salvador under provisions of the Dominican Republic-Central America Free Trade Agreement (DR-CAFTA), seeking one hundred million dollars in damages for their lost mining licenses. If the company wins this lawsuit it would come at a tremendous financial cost to El Salvador, money that could be better invested in economic growth and social guarantees like health and education. At the same time, the presence of the mining company in Northern El Salvador resulted in several local conflicts and tensions; at least three anti-mining activists have been killed in the last two years. To date, the Attorney General’s Office has failed to conduct an in-depth investigation into these murders and the possible connections between them.
What’s happening with crime and violence?
El Salvador suffers from one of the highest murder rates in the world – currently, the homicide rates hovers around 65 deaths for every 100,000 people. This is about ten times the U.S. average. While images of heavily-tattooed gang members dominate the media as the principal perpetrators of crime, there are in fact multiple sources of crime in El Salvador.
Street crime – muggings and petty extortion – is widespread, and victimization surveys suggest that it is the type of crime most widely experienced in El Salvador. Organized crime is a growing problem and organized criminal groups often infiltrate and corrupt police and other state agencies to protect their activities. There are long-standing forms of organized crime – contraband and arms trafficking, auto theft, kidnapping – often committed by groups that mutated out of the death squad structures from El Salvador’s civil war period. Drug traffickers now also have a presence in El Salvador, using the country as a transshipment route to transport illicit drugs from Colombia to the United States. Gang-related crime can range from turf battles between rival gangs, or may be associated with gangs’ revenue-generating criminal activity, such as low-level drug sales, extortions, kidnappings, or killings-for-hire. Figures about gang membership in El Salvador are notoriously unreliable, as are estimates about what percentage of crimes are committed by gangs, however, the director of the National Civilian Police recently reasonably estimated that gang members commit some 40-45% of homicides.
Beginning in 2003, the Salvadoran government focused on gangs as the major perpetrators of crime. Former presidents Francisco Flores and Tony Saca attempted to crack down hard, passing legislation that made it a crime to be a member of a gang, reducing the standards of proof for gang membership, and directing the police to conduct large-scale sweeps to arrest gang members.
The results were highly counter productive. Not only did they fail at reducing homicide rates but resulted in transforming gangs from neighborhood-based social groups that engaged in mostly petty criminal activity to more organized structures whose inner circles carried out high-level economically-motivated crimes and had national and regional linkages. Rather than deterring crime, imprisonment served to bring members together where they could organize more effectively and clandestinely.
Funes’ security team has opted instead for a more comprehensive approach to the problems of crime and violence. Recognizing that violence prevention is a key element in dealing with youth crime, the government has focused efforts on strengthening community -based initiatives by establishing violence prevention commissions in a number of municipalities and working with NGOs and community organizations. It has also focused on the police force, including professionalization strategies, shifts in leadership, restructuring investigative units, and reinvigorating the Inspector General’s office in an effort to address problems of internal corruption. At the same time, it has also recognized that it must reassert control over the prisons, which suffer from overcrowding and inhumane conditions, and from which many crimes are organized and directed.
This comprehensive approach to the issue of insecurity has borne fruit – homicides dropped by about 9% in 2010, and extortions rates fell as well. Even though these are real gains, rates of crime and violence remain unacceptably high.
*Stay tuned for a more in-depth analysis piece on crime and violence in El Salvador coming soon to the Citizen Security page of the WOLA website.
On economic issues: U.S. budget constraints make substantial new investments in El Salvador difficult. WOLA believes that current U.S. assistance programs should emphasize:
- Employment and training opportunities for youth, who are the most likely to emigrate, or to turn to crime to support themselves.
- A focus on development programs in rural areas. Extreme poverty is concentrated in rural areas, and investments in sustainable small-to-medium agriculture producers can pay off in economic development, political stability, and reductions in migration, both to crowded cities and to the United States.
In addition, in accordance with comments made by Obama during his presidential campaign on the need to limit investor rights when issues of public safety and public interest are at stake, the President should direct the Office of the Legal Counsel of the State Department to intervene in the CAFTA suit involving Pacific Rim, filing an amicus brief that defends the right of the Salvadoran government to impose environmentally-sound regulations that restrict mining or other economic activities.
On citizen security: Successfully responding to the problems of crime and insecurity cannot happen without comprehensive, long-term and coordinated security strategies. WOLA believes that U.S. security assistance programs should emphasize:
- Support for strategies that identify and address the range of citizen security challenges in El Salvador.
- A balanced approach between violence prevention and rights-respecting law enforcement measures, including a focus on addressing the institutional needs of the criminal justice system, reforms of the police and judicial institutions, and a significant investment in violence prevention programs.
Moreover, in recent years, a number of international donors (the U.S., the Spanish, the European Union, the Inter-American Development Bank, and others) have pledged assistance to help the government (and other Central American governments) address the problem. A recent study by the Inter-American Development Bank and WOLA suggests that substantial sums of money flow into Central America to support anti-crime and prevention efforts, but that there is very little coordination of the efforts among the various donors or between the donors and the governments. While some initial steps have been taken to improve donor coordination, President Obama should encourage the Salvadoran government and its Central American partners to establish long-term and sustained coordination mechanisms that involve the active participation of civil society and other relevant stakeholders.
Senior Associate for Citizen Security
Senior Associate for Rights and Development