IFAD-backed US$28 million programme provided new opportunities out of poverty for 23,000 rural families

Rome, 25 October 2011 – The six-year US$28 million Economic Development Programme for the Dry Region of Nicaragua (better known by its Spanish acronym PRODESEC) took stock of its successes this September after improving the lives of some 23,500 poor rural families.

The programme benefitted from US$14 million in financing from the International Fund for Agricultural Development (IFAD), US$4 million from the Central American Bank for Economic Integration, and US$10 million in counter-part funding and beneficiary contributions. It was implemented in the departments of Carazo, Chinandega, Estelí, León, Madriz, Managua and Masaya by the Nicaraguan Institute for Rural Development (IDR).

“This programme produced significant results in employment generation, food security, microenterprise development, natural resource management and rural empowerment,” said Ladislao Rubio, IFAD’s Country Programme Manager for Nicaragua. “We are especially pleased with the number of young people that were involved in the project with around 21 per cent of the business plans creating new jobs for rural youth.”

In all, the programme supported 408 business plans designed to generate rural employment. It provided technical and financial support to 311 businesses and worked with 255 agro-industrial businesses to improve production levels and food security. PRODESEC also supported six initiatives designed to help poor rural people to adapt to climate change, reaching some 13,400 families with new water-management systems.

“The integrated water-use systems we put in place were essential for the programmes’ long-term sustainability. In this dry region, water truly means life. And by working with key local leaders, farmers and experts, we were able to strengthen the community stewardship of this very important natural recourse,” Rubio said.

In all, the programme constructed 7,500 water-catchment and management systems, including reservoirs, wells, micro-irrigation systems and family gardens.   

New opportunities

“Truly our life is much better now. We never imagined we would ever be small business owners, or work in a cooperative. This truly is an achievement,” said Xenia Centeno, a 20-year-old agro-industrial engineer who works for Vinos Don Rufo, a winery that benefitted from PRODESEC’s technical support and financing.

The 20 members of the Vinos Don Rufo cooperative were able to improve their production levels, overall quality and incomes thanks to a new wine press, corking device, processing centre and storage facility, and capacity-building seminars on business management, book keeping and accounting provided through the PRODESEC programme.

“Many people in Nicaragua can’t even dream of being a business owner. How are you going to do it? Where are you going to get the money? Today, thanks to the help of IFAD, we’ve achieved these goals,” Centeno said.

Food security

The programme also made significant inroads in reducing malnutrition and hunger in the Nicaraguan countryside. Women received funds through the national Food Production Vouchers programme to grow basic grains to help ensure better food security in the region, which has limited crop diversification.

“In our first baseline survey, we saw that malnutrition rates were high in 2005, food availability was low, and the people went without food for prolonged periods of time,” said the PRODESEC Programme Director Norma Irias. “In the final analysis, we saw that both the frequency and length of time that people go hungry has been reduced significantly.”

Building businesses

According to Irias, job creation and support to micro-enterprises was another important achievement. The IDR supported the formulation of the National Rural Agro-Industrial Programme as a mechanism for rural development and job building, leveraging the lessons learned through the programme to support job growth and enterprising within the PRODESEC programme.

“In the end, we see that the project is creating a breeding ground for rural enterprises,” said Irias. “With this, the people have better self-esteem, they have equity and assets, and they have more capacity and more opportunities.”

Most importantly says Irias, “they see themselves as actors in the economic growth of the territory.”

Income levels also increased, reducing overall risk and enabling young people to stay in school longer. “In some cases, incomes raised by as much as five times,” said Irias. “In the worst cases, they raised by at least two times as much.”

For young enterprisers like Mercedes Calderón, the chief of production at the PRODESEC-supported Artefina Cooperative, this new funding has provided the chance for young people to continue their studies. Artefina has an innovative work-study program that allows young people to support their families while continuing their studies. The workers have seen income increases of up to 20 per cent, money they say will be used to support their families, continue their studies and become productive members of society. 

“Without projects like this, many young people opt for crime… Thanks to the project, we’ve been able to escape this… I say escape this because often times people look for the ‘easy life,’ resorting to prostitution and robbery,” said Calderón. “Why? Because we don’t have the opportunity to work in a dignified manner.”

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Press Release No.: IFAD/74/2011

The International Fund for Agricultural Development (IFAD) works with poor rural people to enable them to grow and sell more food, increase their incomes and determine the direction of their own lives. Since 1978, IFAD has invested about US$13.2 billion in grants and low-interest loans to developing countries through projects empowering about 400 million people to break out of poverty, thereby helping to create vibrant rural communities. IFAD is an international financial institution and a specialized UN agency based in Rome – the United Nation’s food and agricultural hub. It is a unique partnership of 167 members from the Organization of the Petroleum Exporting Countries (OPEC), other developing countries and the Organisation for Economic Co-operation and Development (OECD).