The outlook for Central America depends on where one is standing. In the region’s southern stretches, the future looks bright, with mostly stable politics and expanding economic opportunities in tourism and transportation. Things look bleaker in the Northern Triangle (Guatemala, Honduras and El Salvador), where many citizens struggle to break out of an interminable cycle of violence and poverty. And in the deeply troubled core of the isthmus – Nicaragua – a bloody crackdown on anti-government protestors has the country on edge.

Power & Politics

Democracies in Central America are often fragile, but transfers of power in the region's most stable nation are smooth. On April 1, 2018, Costa Rica elected President Carlos Alvarado Quesada, a 38-year-old novelist, musician and former cabinet minister from the center-left Citizen Action Party. The decisive victory was particularly sweet for proponents of gay rights and for Afro-Caribbeans, who were delighted to see economist Epsy Campbell Barr become Central America's first female vice president of African descent.

In stark contrast, Nicaragua has devolved into civil unrest that's left hundreds of people dead, mostly due to moves by the country's long-time leader, Daniel Ortega, who took the presidency for the second time in 2006. In 2018, Ortega attempted to overhaul the social security system and reduce pension benefits, prompting clashes between hundreds of unarmed protesters and the police and pro-government militaries, who used live bullets. Though Ortega rescinded the social security cut, the political crisis endured, with protesters demanding that the government be held accountable.

In Honduras, a similarly undemocratic shift in term limits led to the controversial reelection of Juan Orlando Hernández of the National Party of Honduras in late 2017. Protests broke out decrying the results as fraudulent, with 17 people killed, and although international observers called for a new election, it didn't happen. Honduras isn’t alone in this matter: perceived (and actual) corruption from the political elite remains rampant across Central America and Mexico, breeding distrust and resentment.

Poverty & Violence

Up and down the isthmus, millions of people continue to face extreme poverty and soaring crime rates. Even the most prosperous nations (Costa Rica and Panama) have poverty rates above 20%, with a wide disparity between the richest and poorest citizens. Other countries are faring much worse, with some 59% of the population living below the poverty line in Guatemala and 61% in Honduras. Unemployment and income inequality are ongoing challenges throughout Central America.

Meanwhile, crime continues to plague poverty-stricken barrios and rural villages, especially in Guatemala, El Salvador and Honduras. The latter two countries have frequently topped the list of nations with the highest homicide rates, though Honduras has shown improvement. Government corruption, gang violence and drug-cartel activity pose overwhelming challenges for citizens of these countries – the only escape often involves a perilous attempt at emigration to the USA.

US Relations

Throughout the 20th century, the US meddled in Central American politics, helping oust democratically elected leaders and prop up military dictators aligned with US interests. The resulting civil wars and genocides sent waves of refugees to the US, where anti-immigration policies landed some on the streets or in prisons. These places became breeding grounds for gangs such as Mara Salvatrucha (MS-13), with the US deporting members to El Salvador. Today, the gangsters continue to wreak havoc in their homeland, deriving financial support from the drug trade, which is in turn fueled by North America's enormous appetite for illegal narcotics.

Although US president Donald Trump’s campaign promise to build a wall between Mexico and the US has so far failed to gain traction in Congress, in 2018 his administration began enforcing a ‘zero tolerance’ policy toward those who crossed into the US illegally. The government directed officials to separate asylum-seeking and illegal immigrant families, and to hold the adults and children in different detention facilities. A public outcry reversed the rule, but not before an estimated 2300 families were separated.

Keeping the 'Eco' in Ecotourism

Much of Central America has embraced tourism as a promise of prosperity that offers employment, investment and an endless stream of cold hard cash. It's the number one industry in both Costa Rica and Belize, and plays a smaller but increasingly significant role in Nicaragua, Honduras and Panama.

The challenge of balancing the demands of the tourist sector with its environmental impacts is an old story in Costa Rica, where debates rage around paving roads, building on beaches and chopping down trees. Once-remote destinations such as Monteverde will see major boosts in visitors as their main access routes get paved in coming years, challenging their off-the-beaten-track grandeur. In Belize, Norwegian Cruise Line has developed an island near Placencia, exposing the region (home to the world's second largest coral reef system) to increased cruise-ship traffic and other environmental impacts.

At the same time, the benefits are indisputable. Tourism provides millions of jobs, as well as a solid customer base for small-business owners. Landowners have a financial incentive to preserve forests, while farmers can supplement their income through rural tourism. Indigenous communities have also capitalized on tourism by selling artisan craftwork and promoting music and dance, creating an impetus for governments to recognize these local cultures.

Central American residents are proud of their heritage and recognize that the goals of environmental conservation and economic prosperity are not mutually exclusive. But the best way to pursue those goals is anything but clear.

Canals: Bigger & Deeper

The Panama Canal has long been one of the region’s biggest success stories, fueling one of the fastest-growing economies in Latin America. Then in 2016, the canal got even bigger. One of the world’s largest transportation projects, the US$5.4 billion expansion has doubled the waterway's capacity and tripled traffic in the canal by adding a third lane and digging deeper to accommodate bigger vessels. Today, millions of containers traverse it each year.

The widened canal will likely prove a boon for Panama’s economy, but detractors fear that the project, coupled with other large-scale development (including a massive expansion of Tocumen International Airport), have shackled the nation with debt. Another less pressing concern is Nicaragua’s proposed rival canal, a US$50 billion waterway meant to connect the Atlantic and the Pacific. The Hong Kong Nicaragua Development (HKND) Group, in agreement with President Ortega, put up the original investment for the 277km canal, which would be four times wider than the Panama Canal and allow the passage of larger boats. But heavy skepticism exists about the feasibility and cost of the Chinese-led project, and environmentalists fear it would cause severe damage to the region's ecosystem. As of late 2018, the construction had stalled altogether due to insufficient funds and fierce opposition to the canal.

Environmental Activists

Latin America is now recognized as the world's most dangerous region for environmental activists, with staggering numbers of people killed each year for protecting forests, rivers and other patches of the Earth from business and government exploitation. In 2016, 14 conservationists were slain in Honduras, including prominent indigenous leader and Goldman environmental prizewinner Berta Cáceres.

More recently, though, there have been some favorable developments. The number of killings in Honduras dropped in 2017, and the following year, Honduran authorities arrested a former military intelligence officer for plotting the killing of Cáceres. Two days after the arrest, 24 representatives from Latin American and Caribbean nations met in Costa Rica and signed 'the Escazú Accord,' a legally binding pact to create a safe environment for activists while investigating and punishing perpetrators.