A study by the Inter-American Development Bank (IDB) estimates the direct annual cost of crime and violence in Latin America and the Caribbean at US1 billion or 3.55 per cent of Gross Domestic Product (GDP) – roughly what the Region invests in infrastructure and double the average cost for developed countries.
IDB’s study, “The Costs of Crime and Violence: New Evidence, New Revelations in Latin America and the Caribbean”, compared the cost of crime for 17 countries in the Region, benchmarking them against six developed countries and found that “crime and violence are at near crisis levels in Latin America and the Caribbean. The Region accounts for nine per cent of the world’s population but contributes nearly one-third of its homicide victims, making it the most violent region outside of war zones. Six out of ten robberies in the Region involve violence and 90 per cent of murders go unresolved. Its prisons are the most overcrowded in the world.”
The IDB noted that while there have been positive developments for Latin America and the Caribbean (LAC) in terms of economic growth comparative to developed countries, crime in the Region has increased.
According to the IDB, “in the face of high crime rates, the costs of crime can be sizable: individuals change their behaviour to avoid (or engage in) criminal activity, households and businesses spend to protect themselves from crime, firms reduce their levels of investment and incur productivity losses, and governments shift the allocation of resources to tackle the associated problems.”
The executive summary of the IDB study revealed that “crime costs LAC countries, on average, between 2.41 per cent and 3.55 per cent of their GDPs. This is equal to an amount for LAC between US5 billion and US0 billion (at 2014 exchange rates) or between US5 billion and US1 billion (adjusted for purchasing power parity). The size of crime-related costs in LAC is similar to what those countries spend on infrastructure and is roughly equal to the share of the Region’s income that goes to the poorest 30 per cent of the population. These cost estimations provide a clear picture of the impact of crime and violence in LAC and should foster improvements in public policies that can ultimately reduce them”.
The Finance Minister, Winston Jordan made reference to Guyana’s crime situation during the presentation of the 2017 Budget estimates, where he announced a myriad of new measures which will allow the authorities to both prevent and respond efficiently to crimes. He announced that in 2017, the Government will expend .1 billion to restore public confidence in our security sector.
Besides the obvious unrest being experienced by the local business community and residents in neighbourhoods across Guyana, the effects of crime would also be felt in the pockets of taxpayers.
The measures to be implemented, which were announced, are all aimed at restoring public confidence in the security sector. These include but are not limited to: increasing recruitment of Police Officers by approximately 20 per cent; improving the Police Force’s mobility; expanding patrols in key areas to deter criminal activity, for which over 0 million has been budgeted, complemented by expansion of the mounted branch in key hinterland locations; strengthening the integrated crime information system; re-establishing and operationalising the 911 service; expanding surveillance; the launching of a multi-agency collaboration to tackle narcotics, smuggling, and human-trafficking, and the upgrading of 12 police stations across the country.
Added to this, to offset the overcrowding of the Georgetown Prison, the Finance Minister announced that the complex at the Mazaruni Prisons would be expanded at a cost of .2 billion, of which 9 million is budgeted for in 2017, and will see the expansion of offices, inmate living facilities, staff and family living facilities, training facilities, as well as the construction of a school, day-care centre and places of worship.
However, the IDB study also notes that countries that spend more on prisons do not necessarily reap the benefits of less violence. “The Bahamas and El Salvador, for instance, spend large sums (in terms of GDP) on their penitentiary systems, but suffer from high crime rates. Argentina and Uruguay, on the other hand, have much lower incarceration costs and lower crime rates.”
The IDB also found that high levels of incarceration rates were exacting an economic toll on the Region, more so Latin America. For the 2010-2014 period, the Region spent US.5 billion per year to maintain and build prisons. On top of this, imprisoned individuals forgo an additional US.3 billion annually in income. The two numbers together amount to 0.39 per cent of GDP, more than the conditional cash transfers for the Region’s poor.
