While U.S. attention has rightly been focused on Mexico's drug wars — with high-profile trips by President Obama and Secretary of State Hillary Clinton before this weekend's Summit of the Americas — Mexico's southern neighbor is in far more serious danger of becoming a failed state. Reeling from gangs, corruption and pervasive poverty, Guatemala now faces well-armed, well-financed drug cartels.

Narco traffickers and organized criminals dominate an estimated 40 percent of the country, from the Mexican border to the Caribbean coast, as well as in the little-populated Mayan jungle and forest preserves of the Peten. Opium poppy fields grow freely. The major threat, though, comes from more than $10 billion in cocaine passing through Guatemala each year, with a tenth of the money laundered in the country and used to bribe officials.

The drug lords and their friends have become the self-ordained local governments and police, either directly or by buying off others. The Sinaloa Cartel, which has run cocaine trafficking in Guatemala for the past several years, is pitted against the Gulf Cartel newcomers. Their "Zetas" (paid assassins) are ratcheting up violence that inevitably hits "civilians." Last year there were more than 6,200 homicides reported in Guatemala.

As I walked the streets of Guatemala City a few weeks ago, the fear of local citizens boarding the city's buses was palpable, and it's no wonder. Bus drivers are a prime target as gang members tied to organized crime extort protection money from bus company owners and the bus drivers union. In the past year, more than 135 bus drivers in Guatemala City were assassinated, and in one case a grenade was exploded on a bus.

Marauding gang members rule entire urban neighborhoods, routinely abusing women and children. Kidnapping doubled last year to 438 cases, and there have been dozens more victims this year. Most suspect "dirty" or former police are behind the snatchings.

If thugs and drug dealers are caught, they are rarely successfully prosecuted. Impunity results from corruption and intimidation of police, prosecutors and judges. For example, one of the country's most notorious drug traffickers was recently stopped for speeding, and arrested after officers found two AK-47s in the car. He assured the officers that he possessed appropriate licenses and promised to have his daughter deliver them. The next day his daughter presented the judge with a thick envelope, which contained not licenses but thousands of dollars in cash and the photos of the judge's wife and children. The drug trafficker was released and the judge fled the country with his family.

All efforts to deal with gangs, drugs and crime are made more difficult by Guatemala’s history.

For decades, Guatemala's elite simply has not allowed tax revenues to rise enough to fund needed schools, health clinics, rural development or justice. The 1996 peace accords that ended decades of civil conflict included unmet commitments to drastically reduce poverty, particularly among indigenous Mayan peoples who comprise a majority of Guatemala’s population.

The World Bank reports that only 14 percent of all indigenous children are enrolled in secondary school. And at 44 percent, Guatemala's child malnutrition rate is not only the highest in Latin America, it is among the worst in the world. In the cities, growing numbers of unemployed, unskilled youth are ready recruits for Maras and traffickers.

The underlying weakness of state institutions is now even more dangerous when Guatemala finds itself threatened by a well-armed and totally ruthless criminal adversary.

The answer lies not in growing the military, which the peace accords reduced by half from 62,000 to some 30,000, and which the past government cut even further, to 16,000. New security sector resources should be dedicated primarily to civilian law enforcement, training prosecutors and judiciary and re-building police — including vetted muscular units — that can go toe to toe with the traffickers. That is the only sustainable way to combat drug traffickers. A recent national security agenda agreed to by the government, church and civil society is a hopeful sign.

With U.S. encouragement, Guatemalan President Alvaro Colom has proposed adding 4,800 new police recruits this year and creating police units to hunt drug traffickers, organized crime heads and the most vicious Maras. In addition, he has proposed adopting the "high impact" court recommendation of the International Commission against Impunity in Guatemala (CICIG), to get a few serious crime courts able to withstand intimidation. Originally established by the United Nations to investigate the presence and activities of illegal armed groups in Guatemala, CICIG has become the key source of investigative support on drugs and crime.

However, successful efforts to produce stability and security will also require a new public-private partnership to develop programs that rapidly improve the country's social indicators and give the growing number of alienated young people real opportunities to learn, work and exercise their rights as citizens.

The Summit of the Americas will not get down to country-level solutions nor review the adequacy of existing counter-drug efforts — the failures of which are evident. However, Obama can join the hemisphere's leaders in pledging a new counter narcotics strategy for the Americas in 2009. It must begin with a reduction in cocaine demand in the U.S., and it must help strengthen police, prosecutors, and judges — and address the "soft" side of security by drastically reducing extreme poverty and meeting the needs of alienated youth. Guatemala is a good place to start.

Mark Schneider is senior vice president and special adviser on Latin America at the International Crisis Group. 

http://www.globalpost.com/dispatch/worldview/090416/guatemala-the-next-fall