Failed States

Watch List

Four countries in big trouble.

GUATEMALA AND HONDURAS

"Every time I go to Guatemala, I find a dead body," says Manuel Orozco, a Central America analyst at the Inter-American Dialogue in Washington. "Anyone can be a target for any reason."

Over the last three years, narcotrafficking in Guatemala and Honduras has gotten a lot worse. A mere 1 percent of South American cocaine went through Central America as recently as 2007; today, somewhere between 60 and 90 percent does. Cartels from Mexico, feeling squeezed by President Felipe Calderón's war against them, have moved south, while Colombian traffickers have moved north.

And as the newcomers fight with homegrown cartels in Guatemala and Honduras, the result has been bloodshed. The U.N. Office on Drugs and Crime estimates that in Guatemala, "some provinces along key trafficking routes have the highest murder rates in the world." The only place where the violence might be worse? Neighboring Honduras, where drug traffickers had a field day while the country was distracted by last year's coup. In October, the country's drug-trafficking czar, Julian Aristides González, expressed his concern, noting that 10 aircraft full of drugs had landed in the past month -- compared with just 14 from January until the June coup. By December, González had been assassinated. He's not the only one; the country of just 7.3 million sees 15 murders per day.

Both countries' utter inability to combat organized crime has only exacerbated the situation. "In Honduras and Guatemala, the state has very limited control over entire chunks of the territory," says Kevin Casas-Zamora, a former vice president of Costa Rica now at the Brookings Institution. "That's what makes them so attractive to organized crime: They are very weak states by almost any indicator." In Guatemala, 15.7 tons of cocaine were seized in 2009 alone, and the drug economy is estimated to be worth twice the country's GDP. Money laundering is commonplace, and in April, the U.S. Treasury extended its sanctions war on drug cartels from Mexico to Guatemala, blacklisting a key family with alleged links to the Sinaloa cartel.

Meanwhile, two Guatemalan chiefs of police have been removed from office in the past year for their alleged involvement in the drug trade. There's a new commission set up to investigate and prosecute high-level infiltration, but with a docket of just 15 cases at any one time, it will take years to make a dent. Down the road in Honduras, the task is equally daunting because, as Casas-Zamora puts it, "a lot of people in the Honduran elite are doing business with drug traffickers."

Things could get worse before they get better. A particular concern is that Central American cartels will move into the production of methamphetamines, following in the footsteps of their Mexican peers. "Part of this incidence of violence and turf wars has to do with securing new facilities," Orozco says. "That's the part that worries me most."

Johan Ordonez/AFP/Getty Images

NIGERIA

After effectively going missing for six months of medical leave in Saudi Arabia, Nigerian President Umaru Yar'Adua finally passed away this May. But while the ambiguity about his condition has come to an end, the political crisis churned up in his absence is far from over. The shake-up exposed gaping social rifts in what was already one of Africa's most troubled countries. Intercommunity violence struck the country's middle belt; rebels in the Niger Delta grew agitated and impatient; and old debates about the regional distribution of resources among the country's 151 million people were revived. Today, the country is in a perilous state as Yar'Adua's successor, the optimistically named President Goodluck Jonathan, takes over.

What happened during Yar'Adua's absence was nothing -- which was precisely the problem. Since the president was still technically alive, his political cadre was loath to replace him, not least because of an unwritten rule in Nigerian politics that the presidency must rotate every eight years between the North and the South, lest the country descend into political infighting or worse, split in two. Yar'Adua was a Northerner; his vice president, Jonathan, was from the South. Jonathan was at last sworn in as acting president in February, but his authority was thrown for a loop just days later when Yar'Adua arrived back in the country in the middle of the night on Feb. 24.

While the politicians were haggling and protesters took to the streets in growing numbers, the country was falling into disarray. A nascent amnesty deal for militants in the oil-rich Niger Delta threatened to fall apart. As many as 500 people were killed in March, when Muslim pastoralists clashed with Christian farmers outside the city of Jos. And all this came in the aftermath of a Nigerian financial crisis that exposed profligate lending by and lax regulation of the country's banks.

With a new president at last in place, Nigeria watchers are hoping for a period of calm. But with a presidential election looming in 2011, the political jockeying is far from over. Jonathan's identity as a Southerner, as well as his more audacious sackings, have taken a toll, and the ruling People's Democratic Party shows signs of splitting. While people fight over the political spoils, the country could easily slip away. The worst-case scenario? A renewed insurgency in the Niger Delta, more religious violence in the country's center, and -- in the most unlikely but still occasionally rumored outcome -- a military coup. Regardless, life for the average Nigerian is getting worse, not better. After years of just muddling through, even that might no longer be an option for Nigeria.

Pius Utomi Ekpei/AFP/Getty Images

IRAN

In 2009, the Islamic Republic faced perhaps the greatest challenge to its existence since its inception in 1979. Between January and June, President Mahmoud Ahmadinejad went from being an uncontested presidential favorite to a widely opposed incumbent. The country's first real opposition movement in decades sprang up, internal power struggles rocked the governing class, and the very foundations of the Islamic Republic were called into question. And the ensuing turmoil is still playing out a year later.

Behind the public unrest was not simply a widespread feeling that the election had been stolen but a growing disillusionment with the government's mismanagement of the economy. Extra cash from the 2007-2008 oil windfall could have been put back into the economy. Instead, the benefits stayed confined to the ruling elite. The result has been economic stagnation, a banking system threatening to collapse, and rising unemployment just as a youth bulge is beginning to reach working age. It will take half a million new jobs every year to absorb the young Iranians entering the job market.

Much of this helps explain the surprising emergence of the Green Movement, which draws heavily from the third of Iran's population that is concentrated in major cities (another third live in midsize cities and towns). For now, the protests have died down and the regime seems to have the upper hand. But Iran's politics are notoriously volatile, and analysts say the unrest of 2009 will have lasting effects. Elections had helped legitimize the Islamic regime in the past, but that's a role they can no longer play, says the International Crisis Group's Robert Malley. Even more destabilizing, he notes, "the supreme leader, rather than being above the fray -- the person who balances various political factions -- is now viewed as an actor in an internal regime struggle."

What happens next could depend on events outside Iran, such as the strength and scope of international sanctions. Ordinary Iranians will undoubtedly feel some economic pain. But perhaps even more important will be the political impact if the sanctions draw the support of not just the West, but also China, Brazil, and others who have been willing to work with Ahmadinejad up until now.

Many hope that such a moment could be the game-changer in Iran -- when a majority of the country's people cease to buy into Ahmadinejad's portrayal of his regime. But the alternative scenario seems equally likely: that turmoil within the ruling cadre will simply seep down, squeezing dissidents and democracy advocates harder. Sanctions might even offer Ahmadinejad cover, as there would be a clear "enemy" to blame for economic pain. Then again, Iran could easily surprise the world one more time.

Amir Sadeghi/AFP/Getty Images

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