MEXICO CITY (Reuters) - When farmers in a tiny Mexican village last month hacked to death suspected drug cartel members who were squeezing them for protection money, it shone a harsh light on one of the country’s biggest security problems: extortion.

While the government has reduced murders, extortion is far higher now than when President Andres Manuel Lopez Obrador took office in 2018, making it a major risk for the economy that has drawn relatively little scrutiny.

Critics say Lopez Obrador’s strategy of trying to contain violence by dialing down direct confrontation with gangs has fueled the malaise because it has given them more room to prey on businesses.

“Burgeoning extortion has not grabbed the headlines, but it’s been the all-the-more corrosive fallout of a security strategy that never merited the label,” said Falko Ernst, a senior analyst at the International Crisis Group.