Woodrow WilsonWoodrow Center Reports on the Americas • #42 US FOREIGN AID TO THE NORTHERN TRIANGLE 2014–2019: Promoting Success by Learning from the Past LATIN AMERICAN PROGRAM By Jeff Ernst, Kelly Josh, Eric L. Olson, Kristen Sample, and Ricardo Zúñiga Eric L. Olson, Editor LATIN AMERICAN PROGRAM The Wilson Center’s prestigious Latin American Program provides non-partisan expertise to a broad community of decision makers in the United States and Latin America on critical policy issues facing the Hemisphere. The Program provides insightful and actionable research for policymakers, private sector leaders, journalists, and public intellec- tuals in the United States and Latin America. To bridge the gap between scholarship and policy action, it fosters new inquiry, sponsors high-level public and private meetings among multiple stakeholders, and explores policy options to improve outcomes for citizens throughout the Americas. Drawing on the Wilson Center’s strength as the nation’s key non-partisan policy forum, the Program serves as a trusted source of analysis and a vital point of contact between the worlds of scholarship and action. Available from: Latin American Program Woodrow Wilson International Center for Scholars One Woodrow Wilson Plaza 1300 Pennsylvania Avenue NW Washington, DC 20004-3027 wilsoncenter.org/lap © December 2020, Woodrow Wilson International Center for Scholars ISBN: 978-1-7359401-2-0 Cover image: June 5, 2012, Maya indigenous children in preschool in El Barranco, Solola Guatemala. Photo credit: Hiroko Tanaka/ Shutterstock. The Woodrow Wilson International Center for Scholars was chartered by the US Congress in 1968 as the living memorial to the nation’s twen- ty-eighth president. It serves as the country’s key nonpartisan policy fo- rum, tackling global challenges through independent research and open dialogue. Bridging the worlds of academia and public policy, the Center’s diverse programmatic activity informs actionable ideas for Congress, the administration, and the broader policy community. Please visit us online at www.wilsoncenter.org. Jane Harman, Director, President and CEO Board of Trustees Bill Haslam, Chair; Drew Maloney, Vice Chair; Private Citizen Members: Nicholas Adams, Thelma Duggin, Barry S. Jackson, David Jacobson, Alan N. Rechtschaffen, Earl W. Stafford, Hon. Louis Susman; Public Members: Alex Azar, Secretary, U.S. Department of Health and Human Services; Lonnie G. Bunch III, Secretary, Smithsonian Institution; Elisabeth DeVos, Secretary, U.S. Department of Education; David Ferriero, Archivist of the United States; Carla D. Hayden, Librarian of Congress; Jon Parrish Peede, Chairman, National Endowment for the Humanities; Michael Pompeo, Secretary, U.S. Department of State. Wilson National Cabinet Kenneth Slater, Co-Chair; Donald F. McLellan, International Co-Chair; The Honorable Joseph B. Gildenhorn & Alma Gildenhorn, Founding Co-Chairs; The Honorable Charles and The Honorable Susan Cobb; Thelma Duggin; Frank F. Islam; The Honorable David Jacobson; William McKenna; David K. Reyes; Wayne Rogers; B. Francis Saul II; Smita Shah; Diana Davis Spencer; Earl W. Stafford; The Honorable Louis B. Susman; Michael Waller; Leo Zickler. Image credit: Shutterstock/ Peter Hermes Furian CONTENTS Acknowledgments ................................................................................................4 Executive Summary ......................................................................................5 1 Overview ..................................................................................................... 14 Introduction ......................................................................................................17 Key Findings .....................................................................................................21 The Recent History of US Relations with the Northern Triangle ...................35 Looking Ahead..................................................................................................38 Sources of US Leverage in the Northern Triangle ..........................................47 A Focus on Governance ...................................................................................51 Issues for Security Cooperation ......................................................................64 Economic Development ...................................................................................67 Complementary Development Tools ...............................................................71 Aid Delivery: Lessons Learned ........................................................................75 Alternative Models for Aid Delivery .................................................................82 The Role of the US Congress ............................................................................85 2 El Salvador Country Report ...................................................................... 92 3 Guatemala Country Report ..................................................................... 120 4 Honduras Country Report ....................................................................... 148 Authors’ Biographies ..................................................................................... 182 ACKNOWLEDGMENTS This report was made possible by the insights and contributions of dozens of interviewees and experts consulted by the authors in El Salvador, Guatemala, Honduras, Washington, DC, and around the region. We are grateful for the many current and former government officials, foreign assistance practitioners, civil society figures, aid beneficiaries, members of advocacy organizations, and academic experts who devoted hours of their time to talk with the authors and shared candid perspectives regarding the implementation of foreign aid in the three countries and how it could be improved. The report was greatly improved by the feedback provided by colleagues who read early drafts, identified gaps that needed to be addressed, and helped us untangle the factors affecting U.S. assistance in the three complex societies that are the focus of our work. The lead authors are especially grateful to the authors of the three country chapters, Jeff Ernst (Honduras), Kelly Josh (El Salvador), and Kristen Sample (Guatemala) for their nuanced reports and for their analytical contribu- tions to the overview chapter; all three were fantastic partners throughout the process. This project owes its existence to Cindy Arnson, Director of the Wilson Center’s Latin American Program, for her early and enthusiastic support for undertaking this examination of U.S. assistance to the Northern Triangle, to David Holiday at Open Society Foundations for his readiness to contribute substantial financial and intellectual support for the study, and to the Seattle International Foundation for its important financial and in-kind support. Cindy and David put their wide network of contacts at the disposal of the authors and el- evated the quality of the analysis throughout the preparation of the report. Anders Beal in the Wilson Center’s Latin American Program provided extraordinary support to all aspects of the project, from supervising the budget to the publication of both the web and printed versions of the report. Oscar Cruz and other members of the Latin American Program team provided additional valuable support and we thank them as well. Finally, to the millions of citizens of Central America who strive every day in the region and abroad to live with dignity and contribute however they can, despite conditions that would try the strongest society, this report was drafted with the intent of helping in a small way to improve their lives. What is good for the people of that vital region is good for the inter- national community as a whole, especially the United States. 4 US FOREIGN AID TO THE NORTHERN TRIANGLE 2014–2019 PROMOTING SUCCESS BY LEARNING FROM THE PAST 5 EXECUTIVE SUMMARY Few regions of the world are more closely linked to the United States than Central Ameri- ca, especially the three countries known as the Northern Triangle: El Salvador, Guatemala, and Honduras. Their relationship with the United States—cultural, political, and econom- ic—is far closer than it is with Mexico or any country in South America, in large part be- cause of the millions of immigrants from the Northern Triangle who call the United States home. If geopolitical competition with the Soviet Union defined US relations with the Northern Triangle in the 1980s, there is no question that migration issues now dominate US policy deliberations related to the region. Central American irregular migration eclipsed Mexican arrivals in the period between 2000 and 2020, most dramatically in the form of mass migration events in 2014 and 2019. The 2014 migration crisis included nearly 70,000 unaccompanied minors, mostly from the Northern Triangle countries, a phenomenon that surprised authorities and se- verely strained federal and state capacity to handle the flow of people. That episode con- vinced the Obama administration of the need to steer additional resources to promote improved conditions in Central America and address the underlying drivers of migration. This led to the establishment of the US Strategy for Engagement in Central America, which was the framework for assistance to the region from 2014 through the first half of the Trump administration. Northern Triangle countries and the Inter-American Develop- ment Bank established a complementary initiative—the Alliance for Prosperity—which