World Bank, all three Northern Triangle nations are lower middle-income
countries. El Salvador, Guatemala, and
Honduras are also, respectively, the second, third, and fourth largest countries
of origin of unauthorized immigrants
in the United States29 (see Table 7).
El Salvador is the wealthiest of the
three nations, with a per-capita income
of $3,426. Although it reduced poverty
during the 1990s in the aftermath of
its civil war, which ended in 1992, El
Salvador’s economy stalled during the
2000s and was hit hard by the 2008
recession—due in large part to its reliance on the U.S. economy. Poverty
now stands at about 38 percent of the
population, roughly the same level as
in 2000.30
Guatemala, as Central America’s
most populous nation and its undisputed cultural capital, exemplifies the region’s socioeconomic injustices. Guatemala has a per-capita income of $2,862,
and 51 percent of its population lives
in poverty. But the poverty rate—as dire
as it is—doesn’t adequately describe
the level of degradation facing broad
swaths of the population.31
In recent decades, there have been
few countries in the world, and certainly no others in the Western Hemisphere, that have lost as much ground
to hunger and malnutrition as Guatemala. Between 1990 and 2008, the
number of malnourished Guatemalans
increased from 1.4 million to 2.9 million. That is an increase of 113 percent.
During the same period, Latin America as a whole lowered its number of
malnourished people by 17 percent.32
In 2007, UNICEF reported that Guatemala had the fourth-highest percentage of chronically malnourished girls
and boys in the world and the highest in Latin America. Nearly half of
Guatemalan children under age 5 are
malnourished.33 The 2011 Human Development Index (HDI) ranked Guatemala at 131 out of 187 nations, between
Morocco (130) and Iraq (132). In the
Western Hemisphere, only Haiti had a
6 Briefing Paper, June 2012
Table 7 Northern Triangle Education and Citizen Security
Population 20101
Average years of
schooling 20112
2010 homicide
rate per 100,000
inhabitants3
El Salvador
6,192,993
7.4
66.0
Guatemala
14,388,929
Honduras
7,600,524
6.4
82.1
United States
309,050,816
12.4
5*
4.0
41.4
*U.S. homicide rate for 2009.
lower HDI ranking.34
Honduras is the poorest of the
Northern Triangle nations, with a percapita GDP of $2,026 and 60 percent
of its population living in poverty. In
a region characterized by low levels of
political legitimacy and respect for the
rule of law, Honduras is perhaps the
least politically stable of the three nations. It is still recovering from a 2009
military coup d’état.35
Challenges to the Productive
Investment of Remittances
(Dis)Enabling Investment Environment
All three Northern Triangle nations score below average on the World
Bank’s “Ease of Doing Business Index.”36 For unauthorized migrants,
who tend to come from families with
lower socioeconomic status, the barriers to entrepreneurship are even
larger.37 With corruption, extortion,
and a generally shaky environment for
the rule of law, returned migrants and
remittance recipients are hesitant to
invest their foreign earnings in wealthgenerating enterprises. The general
economic challenges these countries
face, including a large informal sector
and a lack of access to financial services make any attempt at business-creation daunting. “They don’t trust the
system,” said Borys Chinchilla, former
Guatemala country director for Mercy
Corps. “That’s why we are losing a lot
of potential to do something bigger.”
Crime and violence, particularly in
the rural areas where most immigrants
originate, further discourage economic
investment. “The security of the countryside affects migrants directly,” said
Delbert Field, Guatemala chief of mission for the International Organization
for Migration. “If you have someone
abroad, you suffer more from extortion.
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