Colombia Social Crisis

Colombia and Argentina are two similarly-sized South American states, with Colombia lying at the northern end of the continent, contrasting Argentina at the southern end. With a population of roughly 48.2 million (2013), Colombia is the larger of the two nations, comparing to Argentina’s 42.4 million (2013). However, despite this workforce advantage, Argentina outpaces Colombia economically, boasting a GDP of $437 billion annually, compared to $292 billion in Colombia. This translates to a GDP per capita of $10,301 in Argentina and $6,044 in Colombia, In other words, Colombia’s GDP per capita is roughly 60% of Argentina’s. As an effective indicator of the standard of living in a country for the average individual, a researcher can often look

Francisco E. Thoumi, a well-established expert on Colombia, thoroughly analyzes this effect in his essay “Illegal Drugs in Colombia: From Illegal Economic Boom to Social Crisis.” Focusing primarily on the initial rise of the drug industry in Colombia through the 1980’s and 1990’s, he states that the Colombian economy during this period began to stagnate, with GNP growth slowing to 3.2 percent in 1997, down from a thirty-year average of 5.5 percent (Thoumi, 2002, 110). Additionally, in 1999, Colombia’s GDP logged its first decline since the end of World War II: a loss of 5 percent. Politically, the cartel system in Colombia has contributed to this economic downturn by undermining the regime and their policies. Trust both internally and abroad for the Colombian government and their ability to provide a reliable return on investments severely declined, and this forced higher costs and, per Thoumi, increased violence (Thoumi, 2002, 111). Furthermore, as violence, stemming from both cartels and guerilla groups, has increased, so have security expenditures by the regime (Thoumi, 2002, 111). “‘The cost of crime in terms of

Again performed by Jennifer S. Holmes and Sheila Amin Gutierrez de Pineres, quantitative analysis shows that political violence lies at the heart of Colombian economic struggles, not coca production (Holmes and Gutierrez, 2006, 115). In their paper, “The Illegal Drug Industry, Violence and the Colombian Economy: A Department Level Analysis,” the researchers focus on the impact of coca production on Colombia’s economy in terms of both exports and GDP, while controlling for violence. By analyzing at a department-level, it is again emphasized that focusing on Colombia at a national level is a mistake, and emphasis needs to be made on individual players as opposed to groups. For example, when analyzing paramilitary groups and the FARC (Armed Revolutionary Forces of Colombia) as two separate actors, the researchers discovered that “Paramilitary violence is positively related to exports and negatively to gross domestic product. FARC violence appears to harm exports but, surprisingly, not gross domestic product,” (Holmes and Gutierrez, 2006, 113). The motivations of each group explain this trend. FARC guerilla fighters cause conflict in order to extort resources from the government to support their own cause, while privately funded paramilitary organizations are in many ways a representation of the private sector in Colombia (Holmes and Gutierrez, 2006, 113). Suggesting that political violence is the root cause of economic instability