Peace and Pesos: How Colombia’s Peace Treaty is Impacted by its Developing Economy

In 2016, then-president of Colombia Juan Manuel Santos was awarded the Nobel Peace Prize for successfully signing and implementing a peace treaty that would bring an end to over 50 years of organized violence from a guerrilla terrorist group, the Armed Revolutionary Forces of Colombia—People’s Army (FARC-EP). The agreement brought a light of hope to the families that have been in a three-way crossfire between the FARC, the Colombian military, and paramilitary groups.

However, the peace was short-lived. Slow implementation of the treaty has left power vacuums in rural areas of the country. These gaps have slowly been filled by over 30 new rebel groups that have emerged since 2016. Although some groups are formed by former FARC members who decided to not civilize, there are also new members who believe the rebels offer better pay and benefits than if they were to work in the urban and rural areas of the developing country. These organizations are known as Residual Organized Armed Groups (GAOR).

Origins and Violence

FARC was created in 1964 out of Colombia’s Communist Party to represent the rights of the rural population following the Colombian Civil War. By the 1970s, the group funded its operations from ransoms of kidnapped elites, illegal mining, and the production of cocaine. Although the business provided them with a great amount of wealth, it made them a public enemy of the United States as well as drug-traffickers in the eyes of the national population. At its height in 2002, FARC was estimated to have close to 20,000 active members. By 2014, they generated between US$150 million and US$600 million per year in gross revenue.

The peace treaty in 2016 was not the first attempt in which the government tried to reach an accord with FARC. In 1984, they agreed to a ceasefire for the first time under the Uribe Accord. In it, FARC and the Colombian Communist Party cofounded the Patriotic Union (UP). Although the party achieved initial success, the group weaponized itself again when 200 to 500 UP leaders were assassinated between 1984 and 1988. During this time, several paramilitary groups formed as an attempt by the elite to defend itself against FARC kidnappings, which occurred in spite of the accord. The main paramilitary group, United Self-Defense Forces of Colombia (AUC), worked closely with the military to exterminate the rebel group once the deal failed. Although partially funded by wealthy landowners, the group found great wealth through the coca business. At the end of the 1980s, the second largest rebel group in the nation, M19, decided to disarm and form its own political party. This group had previously invaded the Palace of Justice, killing eleven of the country’s twenty-five justices.

By the end of the century, Colombia’s campesinos (poor farmers) experienced violence by FARC, AUC, and the Colombian military. FARC would claim that some farmers were AUC supporters, while AUC would claim that they were FARC supporters. The military used an incentive system of FARC death counts for holidays and bonuses—in practice, this meant that any corpse would be claimed as a rebel. The homicide rate during this time was close to 60 deaths per 100,000 inhabitants. In 2021, it was 26.8 homicides per 100,000 inhabitants.

After social protests against national violence, FARC agreed to enter again in peace talks with the government. These talks did not last due to a change in presidential administration in 2002. By 2006, AUC was officially disbanded through a peace deal instigated by the US, who saw them as an international terrorist organization. In 2012, the government reached out once again to talk with FARC about peace negotiations. Existing rebel groups like Ejército de Liberación Nacional (ELN) and Ejército Popular de Liberación (EPL) still exist and continue to combat each other.

FARC-Colombia Peace Accord

Not everyone in Colombia wanted the current peace treaty to be signed. The first referendum failed with 50.2 percent of votes against. The main opposition came from the Democratic Center party, which argued that the treaty gave too many benefits to those who caused over 260,000 deaths since 1964 through their historic violence. These benefits included a special court and law for former rebels, temporary monthly stipends, and 10 seats in the national congress until 2022 for their new political party. The peace court (Special Jurisdiction for Peace) would mean that offenses of rebels will not be tried as criminal, giving way for the possibility of former FARC members avoiding formal prison time. The stipend was seen as an incentive by the government for killers. After some slight alterations, the current deal was signed with no referendums. The amended treaty limits the Colombian peace court to 10 years of operations and President Santos ensures that the former rebels will be appropriately punished. The temporary stipend was seen as unemployment support as rebels were trained to reintegrate into society.

The guerilla group was officially disbanded with the signature of the peace accord. Around 7,000 rebels turned in their weapons to the UN and are now represented in national politics as Comunes (common people party).

However, the implementation of the treaty has been slow since the new administration gained power. The current president Ivan Duque is leader of the Democratic Center party. Although he blames the pandemic or an economic crisis for the sluggish implementation of the treaty, it seems highly unlikely that there is a political will to keep expanding the promises. Reports claim that Duque has put in action an additional 8 percent of the accord implementation, leaving it at 30 percent of its full potential. Corruption also does not help, with an estimated US$119 million lost to government officials since the treaty was signed.

Pesos over Peace: the Conundrum for Campesinos

The agreement—officially called Final Agreement to End the Armed Conflict and Build a Stable and Lasting Peace—focused on different aspects of the complex social problem, such as rural reforms, political participation, group deweaponization, drug trafficking solutions, and means of justice and reparations. By 2018, there had been little improvement in the reintegration of the former FARC members through educational and mental health treatments. This was worrisome given that the unemployment benefits that the members got were about to expire in 2019. Although some wanted to become farmers, the government did not provide a program to ease transition and access to the industry. As a result, close to 1,500 ex-members have become dissidents.

The promised rural development goals have also stagnated. Duque’s neoliberal approach to growth has focused on empowering large agro-industrial farms to employ the farmers. The results, however, have been disappointing—there has been a historic trend of only minimal job creations from these large companies. Duque has also disbanded different agencies set up to promote rural development, merging them all with the Department of Agriculture. This is problematic since the department has a history of supporting larger industrial farms over the needs of the campesinos. Underdevelopment of rural regions has led to problems such as illicit crop cultivation and violence from militants.

The outcome of this political disarray is the formation and invasions of GAORs in the country. The lack of access to opportunities along with the little political will allowed the country to lose control of dissident groups. These new groups have different ideals yet they all have one common goal: pesos. Unlike the FARC, there is no claim of a greater social agenda to support rural communities—only supply and demand.

For the rural towns neglected by the government, these groups represent sources of support. A town on the mountainous border with Venezuela exemplifies the conflict. Coca leaves are the main crop of Catatumbo, a town with little transportation infrastructure and remote location that makes it difficult to trade and grow regular crops. The residents claim they have tried to grow other agricultural goods such as coffee or cocoa, yet coca leaves are the only crop with enough demand for people to go to the village and collect them. They do not want to grow these leaves but it is the only profitable option. The result is constant conflict between different rebel groups that try to take control of the town, as well as the military, which adds to local fears. In the local school, there are posters and banners explaining to children what to do in case they stumble upon a landmine or an unactivated grenade. For these people, their only hope is for the government to provide better infrastructure and opportunities for growth.

Yet the government does not support them. The townspeople have had to take it upon themselves to toll those entering town so that they can perform maintenance over what little road they have. Additionally, Duque attempted to reinstate aerial fumigation practices to damage illicit crops. These not only damage legal commodities but could also have adverse health implications for the campesinos. Most importantly, it damages the only meaningful source of income that they have: coca. The country’s Constitutional Court prohibited the administration from advancing these plans until more consultations are done with experts and affected communities.

For these forgotten towns in rural Colombia, the offer to grow coca leaves and sell it to the guerilla group in their area for profit is sometimes their only option. If the farmers refuse to grow the crop, they are killed. If farmers are accused by any of the rebel groups of supporting other groups, they are killed. If the military suspects the townspeople of actively aiding a group, chances are that they will be killed or detained. This creates a devastating reality in which rebel groups become the center of economic stability for rural towns; if the government removes them from these localities without alternative development measures, it is the economy and livelihoods of the residents that suffer.

However, this stability is only temporary. These groups come into constant conflict due to invasions of each other’s territory. This is the case in Colombia’s southern region of Putamayo, in which GAOR Comandos de la Frontera have been in conflict with another GAOR, Carolina Ramirez. In these cases, the towns become battlefields where many civilian lives are lost. Around 10 percent of the country is in territory claimed by one of the rebel groups.

Dilemmas of a Fragile Economy

Another aspect of the larger social issues is the weak national economy. With total employment at 22 million and a labor force of 24 million, there is an oversupply of labor for available opportunities. The effects are lower wages and high unemployment, the latter of which stood close to 10 percent in 2019.

Colombia experienced a recent drop in its gross domestic product, with its growth in 2020 being -6.8 percent. The causes can be associated with the disruptions that COVID-19 pandemic created in the global trade and supply chain. These shocks make it difficult for the government to focus on the former rebels in addition to the general population. As a result, Colombia’s economy is not able to sufficiently reward its workers. The combination of the two factors have led to a lack of opportunities for farmers and urban citizens, which makes joining one of the GOARs an attractive opportunity. These groups pay well and even offer vacation time to its militants.

“One [of the members of the new rebel groups] was a single mother who couldn’t raise her children on the $90 a month she made as a housekeeper; another was a former FARC fighter who had discovered he could make twice as much as the unit’s doctor than he could at a public hospital.” - New York Times

Colombia has had some overall growth in its economy, with poverty rates falling by 15 percentage points between 2008 and 2017 (27 percent in 2017). It has also had a decent GDP growth of 3.8 percent before the COVID-19 pandemic. However, Colombia’s high inequality, with a Gini coefficient of 54.2 in 2020, has diverted that growth from the lower classes. In return, many have looked for alternatives in the informal sector, which employs 62.1 percent of the labor market. However, others have looked for more lucrative—and hostile—ways of creating an income.

Future Outlooks

The peace treaty brought hope to many of the people who have greatly suffered from the conflicts of cocaine in the country. Although it came with excitement, there are some factors that have not allowed it to succeed at its full potential. The lack of political will by government officials to fulfill the terms of the agreement can be explained by the disapproval within the current party’s leadership, as well as internal corruption which has impeded intended allocations to integration efforts. However, the increase in productivity of rural areas, which is a bipartisan policy,has also not been implemented effectively. This raises questions as to why the government has not taken the initiative to empower its campesinos. The developing economy of the country also hinders the prospect of peace due to the large returns that narcotraffic has and the scarcity of job opportunities available for the population in urban and rural areas. The delay in the implementation of the accord has led to a rise in the number of rebel groups that compete for rural land and labor to buy coca leaves. Although many farmers disagree with the practices, it is the only effective means that they have to sustain themselves.

Greater urban development and programs that increase productivity and ease transportation of goods in the rural areas will directly support farmers. Campesinos must be given viable options through which they can develop and outgrow the shadow of narcotrafficking. The government has spent too many resources treating the effects of its social troubles rather than focusing on its root causes: underdevelopment. This idea expands further than mere GDP growth. Addressing inequality without greatly disrupting domestic investments would greatly help strengthen the domestic market, which could raise wages and salaries. Having a military that is more regulated will allow citizens to trust them once again, creating greater collaboration to remove rebel groups from towns. Having a government that is more transparent through harsher consequences for corruption will also lead to greater trust from the public. Attracting more foreign direct investment as well as implementing effective policies to grow human capital will create better jobs for the population. As more effective pathways for financial stability are present for everyone, it will make it much harder for rebel groups to recruit soldiers and fund its operations. Effectively, Colombia’s path for peace is through pesos.