MAPPING THE EVOLUTION OF PEACE AND ITS DRIVERSQuantifying Peace and its Benefits The Institute for Economics and Peace (IEP) is an independent, non-partisan, non-profit think tank dedicated to shifting the worlds focus to peace as a positive, achievable, and tangible measure of human well-being and progress. IEP achieves its goals by developing new conceptual frameworks to define peacefulness; providing metrics for measuring peace; and uncovering the relationships between business, peace and prosperity as well as promoting a better understanding of the cultural, economic and political factors that create peace. IEP has offices in Sydney, New York, The Hague and Mexico City. It works with a wide range of partners internationally and collaborates with intergovernmental organizations on measuring and communicating the economic value of peace. For more information visit economicsandpeaceEXECUTIVE SUMMARY 02 RESULTS in Colima, for instance, it is nearly 66,500 pesos. Furthermore, businesses in Mexico identified insecurity and crime as their most pressing concern, well above other issues such as taxation or corruption. The 2017 Mexico Peace Index (MPI), produced by the Institute for Economics and Peace (IEP), provides a comprehensive measure of peacefulness in Mexico. The MPI is based on the work of the Global Peace Index, the leading measure of global peacefulness that has been produced by IEP every year since 2007. It is part of a series of national peace indices, which includes the United States Peace Index and the United Kingdom Peace Index. This research, now in its fifth year, aims to identify the key trends, patterns and drivers of peace while highlighting policy opportunities. The MPI report includes an analysis of the economic benefits that will flow from a more peaceful society and provides a backdrop for strategic discussions among policymakers, researchers, business leaders and the general public on building peace in Mexico. The full analysis of Mexicos peacefulness shows mixed results. On the one hand, the nationwide peace score deteriorated in 2016, mainly because of the increase in homicides. On the other hand progress has been made in structural reform. Despite the deterioration in the 2016 score, Mexico remained nearly 14 percent more peaceful in 2016 than in 2011, with improvements being recorded in 21 out of 32 states in 2016. The violent crime rate is at a 14-year low and the homicide rate is 16 percent lower than in 2011. Organized crime related offenses reached a ten year low, having returned to pre-drug war levels. The rate of crimes committed with a firearm was 10 percent lower than in 2011, although recent trends show an increase in the purchase of guns. Nayarit, Durango, Coahuila, Quintana Roo and Chihuahua have had the largest improvements in peacefulness over the last six years while Colima, Baja California Sur, Zacatecas, Oaxaca and Michoacán have shown the largest deteriorations. These five states all have rising homicide rates, especially Colima, which had a 2016 homicide rate three times higher than its 2011 levels. It is too early to determine whether the deterioration recorded in 2016 constitutes the start of a new trend. The 2017 MPI report details four important policy areas instrumental to building high levels of peacefulness: impunity, policing, strategies to reduce homicide rates, and the role of local governments. Improvements have been recorded in these areas. For example, the percentage of citizens that trust EXECUTIVE SUMMARY 2the police rose by 13 percentage points to reach 50 percent, while the overall perception of corruption in local police forces fell by six percentage points. Nonetheless, local governments still stand to improve the most: the local forces are perceived as the most corrupt and the least trusted. States have been making investments in professionalizing and strengthening their police forces. Coahuila and Chihuahua have had the largest increases in the size of their forces, at 270 and 47 percent, respectively, from 2015 to 2016. However, increases in the numbers of police need to coincide with professional development to fully gain the benefits of the increased capacity. States that pay higher salaries also tend to spend more on professional training for their officers. Given the high risks associated with the job and the larger payouts often offered by organized crime, salaries need to adequately compensate officers. Impunity is also a major challenge for Mexico. On average, nine percent of crimes committed are punished. Impunity is a widespread issue across multiple states and law enforcement and justice agencies, including impunity for violence committed by some state actors. There is also a high level of impunity for violence against journalists, with 76 media professionals being murdered in 2016. Mexico needs to improve the overall capacity of its judicial and law enforcement systems. The average rate of justice officials is 3.5 per 100,000 people, roughly four times lower than the global average. However, recent improvements are substantial, with the expenditure on the justice system increasing by 41 percent from 2011 to 2016, to 213 billion pesos. There have been improvements in the collection and accuracy of crime data, although official data quality remains poor. IEP uses a variety of methods to develop an accurate picture of peacefulness in Mexico overall and by state. A composite index of peace directly addresses some of the deficits in measuring violence. In addition, the MPI report includes an annual review of data quality in Mexico. In 2015 law enforcement agencies undercounted homicide victims by roughly ten percent, but this is an improvement on a year earlier when it was 15 percent. Similarly, more local governments appear to be correctly reporting the number of crimes committed with a weapon. However four states still report that no assaults are committed with a firearm: Baja California, Morelos, Sonora and Tabasco. Mexicos official law enforcement homicide dataset currently includes only eight out of the 37 pieces of information in the Bogota protocol for international data quality standards. One method of understanding possible future trends in peace is through tracking progress in Positive Peace the attitudes, institutions and structures that create and sustain peaceful societies. Positive Peace consists of eight pillars or domains that describe the factors most closely associated with highly peaceful societies. Positive Peace in Mexico is improving, although progress is uneven. Solid improvements are evident in the sound business environment and high levels of human capital pillars. The indicators that improved the most within these pillars were the cost of starting a business, which fell by 14 percent from 2011 to 2016 and high school enrollment, which rose by eight percentage points from 2011 to 2015. There were also improvements in free-flow of information, equitable distribution of resources and acceptance of the rights of others across a variety of indicators. However, violence against journalists remains a risk to free flow of information. There has been progress in well-functioning government and low levels of corruption, but the pace of improvement is more moderate. An average of 13 percent more citizens reported lower levels of perceived corruption across all law enforcement and justice entities in 2016 compared to 2011. However, this is coming off a high base and levels of corruption are still too high, well above Mexicos international peers. Good relations with neighbors has deteriorated, most notably for the indicator measuring citizens perceptions of safety in their neighborhood, which fell from 60 percent in 2011 to 54 percent in 2016. Taken all together, the 2017 MPI findings highlight the need to maintain the pace of judicial reform and improve accountability. Mexico has made and continues to make significant strides in improving the rule of law and the quality of governance and law enforcement, but the challenges are formidable and the recent increases in homicides very concerning. EXECUTIVE SUMMARY 3 MEXICO PEACE INDEX 2017 | Executive SummaryKEY FINDINGS 4 SECTION 5 ECONOMIC VALUE OF PEACE IN MEXICO j The economic impact of violence in Mexico totalled 3.07 trillion pesos in 2016. This is equivalent to 18 percent of the countrys GDP and represents 25,130 pesos per person; equivalent to more than one months salary for the average Mexican worker.j The economic impact of violence increased by three percent, or 79 billion pesos, when compared to 2015.j Violent crime, which includes robbery, assault and rape, was the largest component, accounting for 47 percent of the total impact from violence. j From 2003 to 2016, federal government expenditure on all violence containment expenditure increased by 120 percent.j Businesses identified insecurity and crime as their most pressing concern, well above other issues such as taxation or corruption. SECTION 3 POSITIVE PEACEj Positive peace in Mexico is improving, but progress is uneven. j The Pillars that have improved the most are sound business environment and high levels of human capital. j Improvements in free-flow of information, equitable distribution of resources and acceptance of the rights of others are broad- based, across a variety of indicators. However, violence against journalists remains a risk to free flow of information.j There has also been progress in well-functioning government and low levels of corruption, but both pillars are still weaker than the global average.j Good relations with neighbors has deteriorated, most notably for the indicator relating to citizens perceptions of safety in their neighborhood, which fell from 60 percent in 2011 to 54 percent in 2016. SECTION 2 TRENDSj Mexico was nearly 14 percent more peaceful in 2016 than in 2011, despite recent setbacks.j At the end of 2016, the nationwide homicide rate was 16 percent lower than in 2011, but an upward trend has returned in the last two years.j Rates of violent crime and organized-crime related offenses have returned to pre-drug war levels.j The violent crime rate reached a 14-year low in 2016, showing a 34 percent improvement from its peak in 2011.j Detention without a sentence is the only MPI indicator that has not improved since 2011, but rather has deteriorated 16 percent since 2011. SECTION 1 RESULTS & FINDINGSj Mexico was 4.3 percent less peaceful in 2016 compared to the prior year. The inequality in peacefulness between the least and most peaceful states continued to increase. j The intentional homicide rate rose 18.4 percent in 2016, with 61 percent of deaths involving a firearm.j The rate of violent crime continued to fall for the fifth year in a row, dropping 9.2 percent last year. j The nationwide score for detention without a sentence improved by 3.2 percent, for the first time in the last six years, likely reflecting the implementation of Mexicos newly reformed judicial system.j IEPs review of the quality of official crime data shows that it has improved, but there are still widespread discrepancies. Given the inherent challenges in measuring violence, a peace index scores provide a more comprehensive assessment. SECTION 4 CHALLENGES & OPPORTUNITIES FOR PEACEBUILDING IN MEXICOj On average, 91 percent of crimes committed in Mexico go unpunished.j Just five percent of Mexicans believe that criminals are always penalized for their crimes, while 11 percent of the population perceive that criminals are never punished. j The percentage of people reporting impunity as their main issue of concern more than doubled from 2012 to 2016, overtaking the percentage of people that see narcotrafficking as the most worrisome issue. j The traffic and municipal police forces are perceived to be the most distrusted and corrupt of all law enforcement entities, highlighting the work needed in local governance. j Operationalizing the Positive Peace framework at the local level can help improve peacefulness and reduce homicide rates.