The following correction was printed in the Guardian's Corrections and clarifications column, Friday March 13 2009

We reported that production of cocaine had increased by 16% across the whole of South America and said that was due to increases in supply from Bolivia and Peru. In fact the regional increase, recorded in a UN survey released last year, was due primarily to a 27% increase in coca production in Colombia. Much smaller increases of 5% in Bolivia and 4% in Peru were recorded

Cocaine production has surged across Latin America and unleashed a wave of violence, population displacements and corruption, prompting urgent calls to rethink the drug war.

More than 750 tonnes of cocaine are shipped annually from the Andes in a multi-billion pound industry which has forced peasants off land, triggered gang wars and perverted state institutions.

A Guardian investigation based on dozens of interviews with law enforcement officials, coca farmers, refugees and policymakers has yielded a bleak picture of the "war" on the eve of a crucial United Nations drug summit.

Almost 6,000 people died in drug-related violence in Mexico last year alone, an unprecedented level of mayhem that is showing signs of spilling northwards into the United States. More than 1,000 have been killed already this year in Mexico.

A new trafficking route between South America and west Africa has grown so quickly that the 10th latitude corridor connecting the continents has been dubbed Interstate 10.

Almost all those interviewed agreed that insatiable demand for cocaine in Europe and north America had thwarted US-led efforts to choke supply and inflicted enormous damage on Latin America.

"We consider the war on drugs a failure because the objectives have never been achieved," said César Gaviria, Colombia's former president and co-chair of the Latin American Commission on Drugs and Democracy.

"Prohibitionist policies based on eradication, interdiction and criminalisation have not yielded the expected results. We are today farther than ever from the goal of eradicating drugs."

The commission is urging a "paradigm shift" from repression to a public health approach, including decriminalisation of marijuana. Dismal statistics about coca cultivation, cocaine exports and murder rates have amplified calls to replace a policy which dates back to Nixon with one which focuses on curbing demand.

"The strategy of the US here, in Colombia and Peru was to attack the raw material and it has not worked," said Colonel René Sanabria, head of Bolivia's anti-narcotic police force.

A report by the Brookings Institution, and a separate study by Harvard economist Jeffrey Miron which was endorsed by 500 economists, have joined the chorus demanding change.

The debate comes to a head on Wednesday when ministers from across the world convene in Vienna to forge a new UN approach to drugs. The European Union and some Latin American countries hope to shape a strategy based on "harm reduction" measures, such as needle exchanges. But holdovers from the Bush administration are lobbying Barack Obama to stick with traditional US emphasis on supply.

Even Colombia's president, Alvaro Uribe, who backs Washington's drug war, has sounded the alarm. "Organised crime could destroy us all if we do not come together to fight it," he told regional leaders recently.

The crucible is Colombia, the world's main cocaine exporter. Since 2000 it has received $6bn in mostly military aid from the US for the drug war. But despite the fumigation of 1.15m hectares of coca, the plant from which the drug is derived, production has not fallen. Across the whole of South America it has spiked 16%, thanks to increases in supply from Bolivia and Peru. Defenders of the drug war point out that the military-led strategy clawed back territory from armed groups and stabilised Colombia.

"It's not fair to say there has been no progress," said Aldo Lale-Demoz, head of the Bogota headquarters of the UN Office on Drug and Crime. "We are not winning and we are not losing. We are controlling."

Successive US drug czars put a brave face on the results but Washington's patience has frayed. A recent report by the Government Accountability Office concluded the war had failed in Colombia. It was commissioned by Joe Biden, then a senator, now the vice president.

A spokesman for the Office of National Drug Control Policy, which spearheads Washington's approach, hinted the new administration may switch tack.