Extortion "Prices" Rise

Product distribution companies in the North of Central America are paying monthly installments of $100 per truck to organized criminal groups.

Wednesday, September 10, 2014

Far from declining, the cost and problems caused by extortion for companies in Central America, continue to rise and is harming regional trade. In Honduras alone, Eleconomista.net reported, "... between 2012 and 2013 some 18,000 businesses closed because of pressures from gang members and consequently some 72,000 direct jobs were lost."

"... Data collected by the National Economic Research Center (CIEN) show that complaints of extortion in Guatemala went down by 21% between 2011 and 2012, however there was a rebound of 16% in 2013."

According to a survey by the Chamber of Commerce and Industry of Tegucigalpa, "... of 2,920 homeowners, 13% identified the main obstacle to investing in the country as being extortion. In response to the Honduran authorities, in 2013 the National Antiextorsiones Force (ANF) was established. Since January this year, the police unit has arrested 370 alleged extortionists."

More on this topic

Growing Cost of Insecurity in Guatemala

March 2016

Companies have to allocate up to 15% of expenses to security services, as a result of the growing violence in the country.

A company wishing to operate in Guatemala has to allocate between 8 to 15% of its expenses to security in order to keep operating. The figure was provided by Victor Guillen, manager of purchases, imports and exports at Dagas, and published by Elperiodico.com.gt, who revealed that his company earmarked Q250 thousand ($32,000) per month for the security of its plants, trucks and workers.

In Central America, Cargo Can Not Be Transported at Night

October 2014

While firms are losing competitiveness by transporting goods only during daylight hours and spending thousands of dollars on private security, regional bodies are writing in their brochures "borders open 24 hours a day."

The inability to move at night time due to attacks by organized criminals on the roads in the region affects not only businesses but the entire transport chain.

Extortion Stifling Entrepreneurs in Guatemala

June 2014

Just on the hiring of private security services companies spend $243 million per year, on top of the payments made to those extorting transport carriers on the roads.

These unpunished crimes are not just affecting freight companies operating in the country, but are also increasingly reducing the possibility Guatemala has to attract more and better foreign investment which would contribute to its socioeconomic development.

Insecurity in Eastern El Salvador

October 2013

Extortion and theft in shops and transport trucks has led to the closure of many small businesses.

According to Howard Gutierrez, president of the Chamber of Commerce, San Miguel subsidiary, crime is unstoppable and the authorities are not doing enough to curb it. In that subsidiary alone there are reports of 15 businesses having closed.

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