Navigating the United States-Northern Triangle Enhanced Engagement Act

During the past few decades, many countries in Latin America have confronted the impact of systemic corruption on rule of law, business, social cohesion, and citizen security. Amid weakened institutional capacities, endemic corruption persists as a foremost challenge in the countries of the Northern Triangle—Guatemala, Honduras, and El Salvador. Those three countries were ranked 101, 116, and 84 respectively among 128 countries examined in the World Justice Program’s Rule of Law Index, and they also share some of the lowest rankings on Transparency International’s 2020 Corruption Perception Index, where their respective ranks were 149, 157, and 104 out of 180 countries. In Honduras, for example, 28 percent of surveyed public service users reported paying a bribe in the last year and 54 percent of people thought corruption had increased in the same time frame. Pervasive corruption comes at a high cost, with estimates that in El Salvador alone, $1.5 billion is lost annually to corrupt activities. High levels of corruption and a weak rule of law have allowed organized crime, driven by drug trafficking to the United States, to thrive in the region. The three countries lose more than 3 percent of their GDP to organized crime. Over the last decade, rates of violence have decreased partially because of judicial and police reforms and community-targeted programming. However, the countries of the Northern Triangle still have some of the highest murder rates in the world.

Since the mid-2000s, Central American countries have taken various approaches to combating corruption. Guatemala accepted the presence of an international anti-corruption body, the United Nations-supported International Commission against Impunity in Guatemala (CICIG) in 2006. Honduras accepted the Organization of American States (OAS)-supported Mission to Support the Fight against Corruption and Impunity in Honduras (MACCIH) in 2016.

In operation for 12 years, CICIG gained attention for its role in the conviction of over 300 officials, notably including former presidents Efraín Rios Montt and Otto Pérez Molina. CICIG was especially popular among citizens, with 70 percent of Guatemalans expressing approval for the organization in 2017. However, after CICIG initiated an investigation of then-president Jimmy Morales in 2018, Morales declined to continue CICIG’s mandate the following year, asserting unfounded allegations that its investigations were politically motivated and that it was not complying with its mandate.

In 2020, MACCIH’s mandate, which was weaker than that of CICIG, lapsed after negotiations ended over the Honduran government’s refusal to authorize the international body to collaborate with a special prosecutorial unit. The elimination of this body was followed by the introduction of a controversial penal code lowering penalties for corruption-related crimes and drug trafficking. There have been allegations that the termination of MACCIH’s mandate was related to the implication of Honduran president Juan Orlando Hernández in drug trafficking.

In El Salvador, under an agreement with the OAS, President Nayib Bukele fulfilled a campaign promise by establishing a new anti-corruption initiative in 2019 known as the International Commission against Impunity in El Salvador (CICIES). Although the new commission did not appear to have independent powers, a coalition of Salvadoran civil society organizations has proposed new legislation, now before the legislative assembly, to give CICIES greater autonomy and expanded capacity.

In an effort to support the countries of the Northern Triangle in their development and anti-corruption efforts, the United States Congress passed the “United States-Northern Triangle Enhanced Engagement Act,” sponsored by Representative Eliot Engel, then-chair of the House Foreign Affairs Committee. The legislation was enacted in December 2020 in the Consolidated Appropriations Act for 2021.

The United States-Northern Triangle Enhanced Engagement Act is intended to advance economic prosperity, combat corruption, strengthen democratic governance, and improve civilian security in El Salvador, Guatemala, and Honduras and curb irregular migration from the region. It calls on the secretary of state, in coordination with the U.S. Agency for International Development (USAID) administrator and heads of other relevant agencies, to submit to Congress a five-year strategy for pursuing those objectives. The law specifies priorities for each of the objectives as well as annual benchmarks to track the strategy’s progress in curbing irregular migration from the region to the United States and improving conditions in each of the three Northern Triangle countries. The secretary of state is required to submit an annual report to Congress describing the region’s progress in meeting the benchmarks.

The second component of the legislation focuses exclusively on corruption. It requires the creation of a list of corrupt and undemocratic actors in the Northern Triangle, known as the “Engel List,” to be made public by the U.S. Department of State within 180 days. To be placed on the list, a citizen or entity under Northern Triangle jurisdiction must have knowingly engaged in “significant corruption.” The kinds of acts that constitute grounds for the imposition of sanctions are described in the law as including corruption relating to government contracts; bribery and extortion; money laundering or other facilitation of proceeds of corruption; and violence, harassment, or intimidation of corruption investigators. The legislation incorporates property-blocking sanctions and denied entry into the United States as consequences along with the immediate revocation of issued visas. These consequences in turn can be magnified by additional placement on the Department of Treasury Office of Foreign Assets (OFAC) and Magnitsky lists.

Similarities and Differences with the Magnitsky Act

With both pieces of legislation grounded in the power of publicly naming and shaming corrupt actors, the Engel List is largely a derivative of the Global Magnitsky Act. While the Magnitsky List has international applications and could be used to sanction the same individuals, the main difference is the Engel List provides the U.S. executive branch with a specific tool to focus on the Northern Triangle. Unlike the Global Magnitsky Act, the Engel List is not a standalone piece of legislation, but rather, connected to a broader five-year strategy, the goals of which are to promote economic growth, combat corruption, strengthen democratic institutions, and improve citizen security. Additionally, while the Global Magnitsky Act targets corrupt individuals and human rights violators, inclusion on the Engel List requires “significant corruption,” making no direct mention of human rights abuses. Instead, the Engel List’s goal is to target and punish corrupt actors, not necessarily those who have committed human rights violations.

The Engel List appears to be the first of its kind in targeting the corruption of a sub region, as previous “list” legislation arose in response to specific instances of human rights abuse. The precursor to the Global Magnitsky Act, the Sergei Magnitsky Rule of Law Accountability Act of 2012, directed the president to likewise report to Congress and publish a list of those responsible for Sergei Magnitsky’s death and broader human rights abuses against those seeking to promote human rights or expose corrupt activities in Russia. Regionally, the Venezuela Defense of Human Rights and Civil Society Act of 2014 required then-president Obama to impose the same targeted asset-blocking and visa restriction sanctions on a list of officials responsible for human rights violations during 2014 anti-government protests. Most recently, the 2019 Hong Kong Autonomy Act imposes visa and property-blocking sanctions on Hong Kong and mainland China officials helping to violate Hong Kong autonomy by also punishing financial institutions that complete business with them.  

Considerations for the Biden Administration in Implementing the Engel Legislation

There are several considerations the Biden administration will need to navigate when implementing the Engel legislation, including establishing clear criteria for placing individuals on the Engel List, ensuring that the list is not inadvertently politically motivated, and clarifying the consequences for regional governments if public officials are placed on the list. The Engel List comes at a time when the Biden administration has on its agenda a redoubling of focus onto the Northern Triangle through the leveraging of aid. The existence of the list now eliminates any wiggle room—the executive branch will have to use the list as a tool to advance the administration’s Central America priorities. On the one hand, ideally the list could productively force the anti-corruption piece of the Northern Triangle agenda into existence for the long term, with the possible repercussions of financial damage and political humiliation acting as deterrence for future corrupt acts. However, with this comes the possibility of real unintended consequences and trade-offs for the administration’s agenda for the region. With unclear criteria, the legislation could act as a major hindrance to crafting the list itself and to providing the amount of promised aid central to the administration’s approach to the region.

The legislation requires the U.S. government to decide unilaterally who has undertaken corrupt actions in the Northern Triangle and to impose targeted sanctions on such individuals. If applied with consistent and clear criteria, the Engel List and legislation will set a precedent for punishing corrupt actors throughout the region and globally. This will be challenging, if not impossible, without clear criteria for adding and removing an individual to the list. The Biden administration will also need to ensure that the Engel List is not perceived to be politically motivated in the region. Furthermore, the legislation opens the door to civil society as a consultant in crafting the list, a powerful measure especially if the Biden administration consults stakeholders across the political spectrum. Though the list will be conducted under independent review, the decision of who will be included on the list is still discretionary with space for interpretation of corrupt behavior. For this reason, the Biden administration will need to establish clear criteria for what constitutes evidenced “significant corruption.”

The list could have an impact on the provision of regional assistance, affecting the Biden administration’s $4 billion aid plan to address the root causes of migration in the Northern Triangle. The legislation simultaneously requires the creation of the list and conditions 50 percent of aid allocated to central governments on their cooperation on anti-corruption and other good governance initiatives. A situation could inadvertently arise where the corrupt individual’s presence on the list jeopardizes a portion of the country’s assistance. For example, if a public official is placed on the list, this could inherently mean the country is not in full cooperation with anti-corruption efforts. A clear delineation will need to be created on whether the status of the corrupt individual on the list would automatically indicate the country is not cooperating with anti-corruption efforts. A cut in aid would also exacerbate the region’s migration push factors, undermining the Biden administration’s long-term objectives not only for the region, but for U.S.-China competition. A loss of aid could push Guatemala and Honduras, two countries that recognize Taiwan, inadvertently closer to China.

The U.S.-Northern Triangle Enhanced Engagement Act provides some instruments that the Biden administration can and should use in its broader approach to Central America, but it is only one part of the solution to complex issues in the region. For example, tools like the Engel List create some consequences for corrupt actors, but do not address the root causes of corruption. Furthermore, the Engel legislation requires the creation of a five-year strategy for engaging with the region, but sustained impact in the region will require much longer than five years. Ultimately, assistance that strengthens regional institutions in the long term will be the most significant form of aid and tool for achieving the Biden administration’s goals in Central America.

Daniel F. Runde is senior vice president, director of the Project on Prosperity and Development, and holds the William A. Schreyer Chair in Global Analysis at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Linnea Sandin is the associate director and associate fellow for the CSIS Americas Program. Amy Doring is an intern with the CSIS Americas Program.

Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2021 by the Center for Strategic and International Studies. All rights reserved.   

Daniel F. Runde
Senior Vice President; William A. Schreyer Chair; Director, Project on Prosperity and Development

Linnea Sandin

Amy Doring