Colombia - Peace and Development Project

PROJECT INFORMATION DOCUMENT (PID) APPRAISAL STAGE Report No.: AB475 Peace and Development Project Project Name Region LATIN AMERICA AND CARIBBEAN Sector Law and justice (20%);Agriculture, Fishing and Forestry (30%);Other social services (30%); Education (20%) Project ID P051306 Borrower(s) GOVERNMENT OF THE REPUBLIC OF COLOMBIA Implementing Agency Environment Category [ ] A [X ] B [] C [ ] FI [ ] TBD (to be determined) Safeguard Classification [ ] S1 [ X] S2 [ ] S3 [ ] SF [ ] TBD (to be determined) Date PID Prepared November 14, 2003 Date of Appraisal March 10, 2004 Authorization Date of Board Approval June 10, 2004 1. Country and Sector Background Conflict and Violence Colombia's long-standing internal armed conflict has increased in severity since the 1960s, and rates of violence have intensified significantly since 1996. From 1970 to 1991, homicide rates tripled, and despite a 20 percent decrease between 1992 and 2000 (due to a decrease in the three largest cities1), Colombia's homicide rate remains three times higher than Brazil's or Mexico's. In fact, worldwide, Colombia's homicide rate is surpassed only by that of El Salvador. Similarly, extortion, kidnapping, car theft, and armed robbery rates have continued to grow throughout the 1990s, leading Colombia in 1997 to a remarkable household victimization rate of more than 35 percent. Multiple empirical studies have sought to explain the determinants of homicide and crime in Colombia, testing five alternative hypotheses: (i) illegal drug trade; (ii) impunity; (iii) the presence of extra- governmental groups (guerrillas and paramilitaries) that have taken over traditional governmental roles in parts of the country; (iv) poverty/income inequality; and (v) the possibility that Colombia's decades of internal strife have created a population that is innately more "violence-prone". The high homicide rates prevalent in Colombia today seem to be caused by two factors: the drug trade coupled with the presence of illegal armed groups. S