MEXICO CITY – The gangland-spawned violence blamed for more than 100,000 deaths in Mexico over the last seven years also has a measurable impact on the Aztec nation’s economy, an Australia-based research outfit says.
The “direct cost of violence to the Mexican economy is 3.8 percent of GDP, while the indirect costs amount to 12 percent for a total of 2.49 trillion pesos ($191.5 billion),” or 15.8 percent of GDP, in 2012, according to a study by the Institute for Economics and Peace.
At the same time, the IEP’s Mexico Peace Index identified a 7.4 percent improvement in peace over the past two years.
The IEP quantified the level of peace for each of Mexico’s 31 states and the Federal District based on seven indicators.
Morelos, near the Federal District; Guerrero, on the southwestern Pacific coast; and Chihuahua, bordering Texas, are the three least peaceful states.
Rated most peaceful are the southeastern state of Campeche and the east-central states of Queretaro and Hidalgo.
IEP analysts found median GDP growth of 9 percent in the peaceful states, compared with only 4 percent in the more violent regions.
“Under optimal conditions, if there was no violence in Mexico, the economy would have the potential to improve by up to 27 percent,” the Australian think-tank says.
Over the last 10 years, according to the IEP study, “Mexico experienced a marked increase in direct violence as a result of the drug war, with peace declining by 27 percent.”
The homicide rate has soared by 37 percent since 2007, the first full year in office for President Felipe Calderon, who made a militarized struggle against drug trafficking the centerpiece of his 2006-2012 mandate.