A new report from the Inter-American Development Bank (IDB) found that crime and violence cost Latin America and the Caribbean some $261 billion USD per year. This number, which represents 3.55% of GDP, is much higher than the rates seen in the developed nations.
Crime and violence cost the United States 2.75% of GDP, by contrast, while it erases just 1.34% of Germany’s GDP, according to the study. At 3.12%, Colombia comes in below the regional average.
Honduras (6.51%) and El Salvador (6.16%), both besieged by drug gang wars in recent years, are being ravaged the most by violence. The Bahamas (4.79%), Jamaica (3.99%), and Brazil (3.78%) are also well above the regional average. Mexico (1.92%), Uruguay (2.23%), Barbados (2.68%), Chile (2.77%), and Peru (2.77%) are the best performers in the study.
“Crime has reached alarming levels in many countries,” said Ana María Rodríguez, manager of the IDB’s institutions for development department. “By providing estimates of the costs of violence at the regional, sub-regional, and national levels, the study will help governments and international cooperation agencies better allocate resources, as well as design better policies to control and prevent crime.”
With just 9% of the world’s population, Latin America and the Caribbean account for almost one-third of global homicides per year, per the IDB. Troublingly, some 90% of these murders go unsolved.
For its part, Colombia has made vast progress on its murder rate in recent years. Its 2016 homicide rate of 24.4 homicides per 100,000 inhabitants was the nation’s lowest in more than four decades, falling to a level not seen since 1974, according to the government.
In all, some 12,000 people were murdered in Colombia last year, less than half as many as 2002, when at least 28,387 people were killed in the country, according to the United Nations Office on Drugs and Crime. That year, its homicide rate of 68.9 per 100,000 people was more than 10 times higher than Costa Rica (6.3) and nearly twice that of Guatemala (37.0) and Venezuela (38.0).
The IDB notes that it believes its estimates are conservative and that the region could increase its infrastructure spending, for example, by at least 50% if it can get its crime levels down to developed world standards.
Among the various costs calculated are the expenditure on prisons, which reaches $6.5 billion USD per year in the region. Then there is the estimated income that prisoners are unable to make due to incarceration, which is even higher at $7.3 billion USD. Combined, this alone equals 0.39% of GDP. Colombia’s total for these two categories is 0.32%.