Obama wants to give $1 billion to Central American gov'ts fighting massive corruption scandals

A boy holds a sign that says "no more corruption" during a demonstration demanding the resignation of Guatemalan President Otto Perez Molina on May 30, 2015.

MEXICO CITY — If timing is everything in politics, then scandals currently wracking Honduras and Guatemala could not have come at a worse moment.

The Central American nations are in a crucial phase of lobbying for new US funds to help them break out of a cycle of poverty and violence.

The direly needed aid was dubbed “a mini Marshall plan” by Honduran President Juan Orlando Hernandez. The call for funding followed record numbers of Central American children arriving unaccompanied on the US border last year, fleeing poverty and sky-high murder rates.

The Obama administration is behind the proposal, asking for $1 billion to bolster the region in 2016. “There is no reason Central America cannot become the next great success story,” Vice President Joe Biden has said.

But it is a hard sell in a Republican-dominated Congress already financing a string of wars.

More from GlobalPost: Honduran special forces are struggling to keep children from fleeing to the US

And as the 2016 budget negotiations reach fever pitch in the United States, the presidents of both Honduras and Guatemala have come under fire for alleged corruption.

The scandals aren’t directly linked to aid money. But they have reached the highest levels of government, which have executive oversight on any spending.

Honduran President Hernandez admitted earlier this month that his 2013 election campaign took money from companies linked to the alleged skimming of hundreds of millions of dollars from the government health service. The racket is alleged to have left patients without vital medicine.  

A woman wearing a headband that reads "no more corruption" participates in a march to demand the resignation of Honduras' President Juan Orlando Hernandez in Tegucigalpa on June 12.

Hernandez said he was unaware of the crime and denies personal wrongdoing. But on Friday, thousands of protesters marched through the Honduran capital calling for his resignation.

Over the border in Guatemala, President Otto Perez Molina is in even deeper waters.

Last Wednesday, the Supreme Court ruled that Perez will be investigated in a corruption probe and could be stripped of his parliamentary immunity.

The probe also involves the nation’s health service, charging that favored companies were given overpriced contracts they couldn’t manage well. One company was hired to carry out dialysis on patients with kidney problems; their treatments allegedly led to several deaths.

Last month police arrested the social security head, who was also a former private secretary to Perez. The president denies wrongdoing, but as in Honduras, thousands of protesters in Guatemala have also taken to the streets calling for his head.

To complicate the aid issue further, Reuters reported Wednesday that Central American leaders hope $1 billion would only be the tip of the iceberg.

They had drawn out a plan calling for $20 billion over the coming years from public, private and development sources, the agency reported.

This week, Honduran, Salvadoran and Guatemalan foreign ministers plan to visit Washington to lobby on the issue.

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