The Bolivian Proyecto Vale project works to improve natural resource management practices. Sustainable practices in environmental management are a central cog toward promoting peace.
Peace is possible within our lifetime. As a matter of fact, if we want to end rural poverty, feed the world and protect our little blue planet in peril, achieving peace is not just a lofty goal… it’s a necessity.
Nowhere is this more true than in Latin America and the Caribbean, where violence – against women, young people, poor people and the earth – is hindering development initiatives, lowering economic potential and literally pulling the fabric of societies apart one string, and one lost opportunity, at a time.
But we can only achieve this goal by making smart investments today that will provide young people and marginalized communities with the tools they need to plant and nourish the basic seeds that will lead to a kinder, greener, smarter, more equitable future.
If we look at the region as a whole, four basic pillars to achieving peace through sustainable rural development emerge.
Pillars of peace
Conflict at a glance
An investment in rural women is an investment in education, nutrition and our future.
Just how serious is the problem? According a recent World Bank report “Central America's spiralling wave of crime and violence is threatening the region's prosperity as countries face huge economic and human losses as a result of it.”
“Aside from the pain and trauma inflicted upon victims, violence can cost the region up to 8 per cent of its GDP when taking into account law enforcement, citizen security and health care costs,” the Crime and Violence in Central America – A Development Challenge (2011) report argues. “This is no small change for a region that in 2010 grew around 2 per cent of GDP, while the rest of Latin America grew around 6 per cent.”
We know that violence is primarily an urban phenomenon in Latin America. In fact, the Poverty and Inequality 2011: Latin America Report indicates that urban areas in the region are primarily facing challenges of inequality, security and economic dynamism, while rural areas show lags in access to services and basic rights such as health and education.
But the problem of violence does not stop at the city’s edge. This lack of access to basic rights in the countryside is fuelling a rapid urbanization rate, and providing new fighters, new gang members and new thieves that fan the fires of violence in the cities.
Conflicts over natural resources are also on the rise. In Bolivia, for instance, there are over 1000 standing conflicts between communities, businesses and international interests. Much of these conflicts are centred on water and land use, thus making it essential to build sustainable systems to manage these scarce resources, title land and weave the strand of ecological idealism into a new social fabric.
So what are we doing about it?
Throughout the region, we are funding peace by investing in youth, job-creating rural enterprises, training programs, market access, education and protection of Mother Earth.
For example, the IFAD Executive Board approved in April a new US$36.5 million poverty reduction project for Peru. The project looks to nearly double rural incomes, build social inclusion, and will be key in achieving the Peruvian government’s goal of reducing poverty by 10 per cent by 2021. Additionally, the project includes a US$1.5 million IFAD grant to further public-private partnerships between local communities and mining corporations to improve water management in the highlands.
The Executive Board also approved two new projects for Brazil in the same session. The projects will benefit over 80,000 poor rural families at a total cost of US$133 million, with US$56 million in IFAD funding. The projects focus on education as the central tool to overcoming poverty.
We also signed an agreement in October with the Brazilian state of Paraíba for a new US$49 million social inclusion project that will work with traditionally marginalized groups like women and youth to provide them with the tools and technologies they need to build their businesses, improve household assets, reduce child malnutrition, overcome rural poverty and contribute to a sustainable natural resources management.
In Colombia, we continue to fund innovative poverty reduction projects designed to build peace and enhance social inclusion. We recently signed a new loan agreement with the Government of Colombia for the US$69 million Trust and Opportunity Project.
The project seeks to improve food security, ease access to financial and community services, increase incomes for small-scale producers by as much as 32 per cent, and create mechanisms to rebuild the social fabric of a country that has witnessed war and endemic violence for more than 30 years.
In this edition of Rural Perspectives, we take a look at how IFAD-funded projects are seeding peace in places like Honduras, Nicaragua and Peru. These projects look directly at traditional development as a mechanism to improve the social fabric of the local communities. In the end, only strong threads can withstand the forces of violence and conflict. Only strong threads can weave the textile of peace.
New reports from our knowledge partners
Between 2007 and 2012 the Rural Territorial Dynamics Program worked with more than 50 organizations in 11 Latin American countries to explain why some rural territories have achieved greater economic growth, environmental sustainability and social inclusion, while others have demonstrated notable lags in development. With the knowledge from this work, the program collaborated in the design and implementation of public strategies, policies, programs and projects throughout the region. The program benefited from the support of IDRC Canada, IFAD and the New Zealand Aid Programme. The final report prepared by the implementation agency, the Rimisp Latin American Center for Rural Development, highlights the lessons learned from this innovative program. Learn more by visiting the Rural Territorial Dynamics web portal www.rimisp.org/dtr.
To learn more about IFAD’s work toward peace and social inclusion in Latin America, check out our recent interview series, which highlights the work of our talented Country Program Managers across the region.
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Honduras is one of the most violent countries in all of Latin America. In the last decades, drug trafficking, roadblocks, extortion and robberies have become commonplace in this small Central American country.
And while the problem of violence is largely centred in the big cities, it is spreading toward the countryside, affecting profits and production levels, and making it hard for small-scale producers to make enough money to get by, keep their kids in schools and their profits in their pockets.
So what are the biggest challenges facing rural producers in the region, and how are projects backed by the International Fund for Agricultural Development (IFAD) working to leverage sustainable development initiatives in the Honduran countryside to create peace?
According to the project directors from the IFAD-backed Project for Enhancing the Rural Economic Competiveness of Yoro (PROMECOM) and the Sustainable Rural Development Programme for the Southern Region (EmprendeSur), the answer lies in supporting employment, in creating opportunities and in ensuring education.
How big is the problem?
Young women have found work in the COCASAM coffee production plant, which produces coffee for export, thanks to support from the EmprendeSur Programme.
Honduras has become a bridge for drugs into the United States and has a serious gang problem, with one of the highest murder rates in the world. There are 86 murders for every 100,000 inhabitants – over half of whom are young people.
More disconcerting is the unemployment rate for young people. The national unemployment rate in Honduras hovers around 3.9 per cent. But under-employment is common, and about 800,000 young people neither worked nor studied in 2011, and the unemployment rate for youth currently sits at approximately 38 per cent. A national plan to stimulate employment for youth is in place. The plan looks at both farming and non-farming jobs.
Considered a lower middle-income country, Honduras has persistent poverty, food insecurity and equality issues. In rural areas, 63 per cent of people live in poverty, and 50 per cent are considered extremely poor.
“On a national level violence in some way is affecting our farmers. Mostly it is robberies. In some parts of the project intervention zone, you see intimidation by gangs and drugs,” says PROMECOM Director Rafael Guillen. “Unemployment is an important trigger for this violence, generating displacement of young people and women from the countryside to the city. The very same who end up unemployed in the cities and being used as criminals.”
Within the EmprendeSur intervention area, violence – which includes murder, roadside attacks, intimidation and bribery – is scaring off potential investors, and leading some producers to move to safer areas. This has created a few push-on affects that are hurting the bottom line: production costs are higher because there are less people in the labour force, and new expenses for security measures, such as armed guards and fences, are adding to operational costs.
“Gangs and thugs charge small producers a ‘war tax‘ on a weekly basis,” says Arturo Oliva Herrera, Director of the EmprendeSur Program. “The roads are not safe, and it makes it difficult to bring the produce to market. These assaults also frighten off cooperation agencies, and keep the communities in a high state of alert.”
Ridoniel Rodríguez is a member of the San Marcos de Colon Coffee Producers Association. Violence in the region has raised his production costs. Not only does his organization pay an additional fee for gas and vehicle maintenance for local police, but they also had to build fences around their coffee plantations, which are vulnerable to robberies.
“In our village there have been kidnappings of producers. Some lost their life because they couldn’t pay the ransom. Five farmers have died in the last five years,” says Rodríguez.
Development for peace
A farmer participating in the PROMECOM project surveys his crops.
“We’ve seen throughout Central America that sustainable development projects like EmprendeSur and PROMECOM can contribute significantly to peace,” says Joaquin Lozano, the IFAD’s Coordinator for Central America. “While these projects are relatively young, they are making progress by providing education and employment for young people, rebuilding the social fabric that has been ripped apart by gangs, easy money, endemic violence and lack of opportunities, and providing young people with greater access to credit, financial instruments, land and productive assets.”
The IFAD-financed National Program for Local Development (PRONADEL) closed in 2009. According to project completion reports, the project generated 2518 productive projects to enhance food security through commodity and grain production. It benefited over 22,000 families and 93 micro-enterprises, and generated some 1900 jobs. It also helped establish rural savings associations and fostered a 15 per cent increase in the number of legally registered rural properties within the project area with the issuance of more than 23,000 land titles.
The on-going PROMECOM project is giving priority to women and young people, along with micro, small and medium enterprises (MSMEs), which, they say, are key employment drivers in the region. Overall, support for MSMEs in the project area has generated over 2000 temporary and permanent jobs.
They are also working with poor and extremely poor communities to improve housing and ensure food security, build capacities within organizations, and provide young people with the tools and training they need to become successful farmers.
The project has generated thousands of permanent and temporary jobs through these various programs. The PROMECOM basic grains initiative works with the World Food Program to buy basic food grains at a just price from local producers. The project estimates that this has generated some 950 permanent jobs and over 1200 temporary ones.
Working with the IFAD-supported Guatemalan Exporters Association (AGEXPORT), coffee producers in the region are gaining access to local and regional markets, and fair-trade exporters. Other project funding is being allocated for the construction of eco-friendly stoves, metallic silos and family gardens. Agroforestry and diversification initiatives are also taking root.
“EmprendeSur is promoting opportunities for young rural people and has established an educational program on values, morals, inclusion, health, HIV, gender and economic development with the end goal of putting these issues into perspective for young people,” says Oliva. “We are also strengthening municipalities in improving their planning processes.”
Through IFAD-funded initiatives, strengthened municipal planning centres have provided increased security in numerous small villages in Central America.
Also key is building better market access and reliable income streams – in short, legitimate ways to make more money.
“A rise in family income on the farm level reduces violence because people keep themselves occupied with activities that improve our quality of life,” Rodríguez says. For example, coffee production generates six months of harvesting work and another six for tending the plants for young people in the area.
“Agriculture is a way of life that is in danger of extinction in many communities where young people migrate to other countries and there isn’t anybody to follow-up on the productive tradition. They then need to sell their land, and we don’t want that,” says Rodríguez.
Evaluating bio-physical conditions for sesame production with a farmer’s group supported by EmprendeSur..
How do we break the cycle of violence?
At the moment, most of the mechanisms put in place to stem violence in Honduras are “coercive” methods, like jail and penalties, according to Oliva.
To combat this, young people should have access to risk capital and other creative financial instruments, and rural schools should be strengthened to provide young people with specialized training in rural business, technologies and planning. Finally, says Oliva, companies should receive incentives to employ young people.
“The creation of permanent small producer trusts – like the environmental funds in Nicaragua and Honduras along with the Costa Rica Development Bank that finances agricultural initiatives – opens the opportunity to create more employment,” says Oliva.
The role of multinationals
Honduras is headed for a general election in November 2013, but according to representatives from EmprendeSur and PROMECOM, there are no foreseen issues that should affect the long-term sustainability of these initiatives.
With the United Nations Development Program playing the role of a guarantor, the hiring of personnel within the project is secure and transparent, and investments made by the project for farmer’s groups are authorized according to the needs within the countryside, according to Guillen.
Multilaterals and other international institutions like IFAD can help guarantee project successes by focusing on providing legal means to formalize the regional economy, creating dialogue platforms, and strengthening both local and national capacity to administer programs such as EmprendeSur and PROMECOM, according to project representatives.
One key component could be the creation of an agricultural fund that doesn’t just focus on those who have the least, but also the children of farmers who have now achieved success. “Given the opportunity, these people could create solid jobs,” says Oliva.
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By Roberto Haudry
World leaders take note. The ‘free market’ works better when it’s socially inclusive.
Knowledge share fairs bring communities together.© Annibale Ferrini, Proyecto Desarrollo Territorial Rural con Identidad Cultural/Rimisp.
Just look at the example of Peru, where competition and free-market macro-economic policies are working in tandem with socially inclusive rural development policies to create one of the Western Hemisphere’s fastest growing and most dynamic economies.
This will be the model for 21st century economic development. And at the heart of this model are the small-scale farmers, rural enterprises and marginalized communities – indigenous peoples, women and youth – that will make it possible. These are the people that will feed the world tomorrow, protect us from the affects of climate change and build a sustainable future for our planet at peril.
So how has Peru done it? How has a nation with a pronounced history of violence, instability and economic vulnerability been able grow GDP by 6.9 per cent in 2011, to weather the global recession relatively unscathed and to build pathways toward peace and sustainability?
They’ve done it by putting their citizens first, by investing in indigenous peoples and smallholder farmers, in savings accounts for women, and in opportunities for youth. They’ve done it by transforming subsistence farmers into rural entrepreneurs.
Weaving in Sibayo.©Annibale Ferrini, Proyecto Desarrollo Territorial Rural con Identidad Cultural/Rimisp.
I’m proud to say that the organization I work for, the International Fund for Agricultural Development (IFAD), has played a proactive role in this transformation by funding nationally run programs that have yielded a number of innovations in social inclusion – including a new US$36.5 million project recently approved by IFAD’s Executive Board that will help some 40,000 poor rural families in Peru. These innovations have become part of Peru’s national strategy on rural poverty reduction and offer a number of worthwhile lessons for the rest of the world.
Key are the public competitions now held throughout rural development programs in Peru to assign project resources and manage natural assets. As small-scale farmers compete against each other for funding, technical assistance and natural resources – funding they manage themselves through the Local Resource Allocation system – they become the key driver’s in their own development.
This demand-driven approach ensures long-term sustainability for project investments and has been replicated in other rural development projects, including the World Bank-financed Aliados project in Peru and other IFAD-funded projects in the Andean region.
At the heart of Peru’s unique brand of rural development is the concept of investing in local talents. Through the Management of Natural Resources Southern Highlands Project (MARENASS), we began investing in yachaq (lead trainers) who shared their knowledge on farming techniques, soil management, market access and savings with their yachacchiqs (or pupils). These students soon became the teachers, passing on powerful new seeds of knowledge to neighbouring rural communities.
The condor is a symbol power and health in Andean culture.©Annibale Ferrini, Proyecto Desarrollo Territorial Rural con Identidad Cultural/Rimisp.
Rural poverty dropped by 24.2 per cent from 2001 to 2010 in Peru, and the government has made a pledge to lower overall poverty by another 10 per cent by 2021. The government’s investment in rural women has also been central to this success. For example, the IFAD-supported Market Strengthening and Livelihood Diversification in the Southern Highlands Project (Sierra Sur) has worked with some 9,000 women to open savings accounts. With complementary contributions provided by project funding, these women now have more than US$1 million in accrued savings.
There certainly is much still to be done in Peru. Nationally, nearly a third of the population doesn’t make enough money to meet their basic food needs. But by looking at the lessons learned in the field – and sharing them throughout the world with IFAD-sponsored ‘Learning Routes’ – we are seeing that Peruvian-built innovations in social inclusion can be a powerful mechanism to end rural poverty in other parts of the globe.
Originally published in Spanish in El Peruano.
About Roberto Haudry
Roberto Haudry is IFAD’s Country Program Manager for Peru. He holds a Doctorate in Latin American Studies from the Sorbonne. He has been working in rural development for more than 25 years.
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Investment in youth, jobs, education and rural businesses works toward peace in Nicaragua
Hard work is providing an alternative to drugs and gangs for young producers.
Peace through development comes in many shapes and sizes. And Nicaragua – a country that is still recovering from a nearly 20-year war, endemic poverty, weak infrastructure and a war on drugs just to the north – is offering valuable lessons on how we can create sustainable mechanisms toward peace by investing in poor rural people.
In fact, by most estimates Nicaragua is the safest country in Central America, and it is the third safest in all of Latin America. It ties neighbour Costa Rica for the lowest murder rate in the Isthmus, with just 12 homicides per 100,000 inhabitants in 2009. That same year, the murder rate per 100,000 in El Salvador was 76, Honduras was 67, and in Guatemala the rate fell to 48.
“Nicaragua offers us a unique case study for the region. If you look at the nation’s bellicose history, at the drug trafficking routes that traverse its shores, at poverty levels and other factors that trigger violence, it should be one of the most dangerous spots in all of Latin America, but thanks to sound management of the macro-economy, and continued efforts to improve security for its citizens, opportunities for youth and sustainable agricultural production models – where the country produces the food they eat – Nicaragua as a whole is finding ways to move forward, feed its people and reduce poverty,” says Ladislao Rubio, the International Fund for Agricultural Development’s (IFAD) Country Program Manager for Nicaragua.
Putting poverty in context
Nicaragua is the second-poorest country in Latin America, with the lowest per capita income among Central American countries (US$1,239 in 2011, according to the Central Bank of Nicaragua). The Nicaraguan economy has grown over the last 10 years, with rates of 4.5 and 4.7 per cent in 2010 and 2011, respectively.
According to figures from the Central Bank of Nicaragua, the agriculture sector is a motor of the economy, representing 20 per cent of GDP. The sector produces more than 60 per cent of annual exports, constitutes more than 30 per cent of the labour force and grows 70 per cent of the food supply.
Foreign investment is up from around US$510 million in 2010 to US$968 million in 2011, according to the Central Bank of Nicaragua.
Despite these positive indicators, they are not sufficient to reach the level of other economies in the region, and to confront the persistent levels of overall poverty (42.5 per cent) and extreme poverty (14.6 per cent).
Extreme rural poverty in Nicaragua as a whole fell from 30.5 per cent in 2005 to 18.2 per cent in 2009, with global malnutrition dropping from 6.7 per cent to 4.6 per cent during the same period.
“While much work still needs to be done in the fields of environmental protection, education, access to land and credit, on the whole, Nicaragua is avoiding violence, reducing poverty and supporting pro-farmer initiatives,” says Rubio. “At the heart of it all is a concerted effort to engage and support Nicaragua’s young rural talents.”
Recent case studies produced by the Procasur Corporation, with the support from local communities, the Rural Development Institution and Nicaragua’s new Ministry of Family Economy, provide sound examples of effective engagement with young people within IFAD-funded projects. According to Procasur, there are four central pillars to engagement with young people. These include access to technical and business development assistance, insertion into labour markets, access to land and productive capital, and access to financial services.
Education and technical development
An artisan’s cooperative in Nicaragua supported with funding from PRODESEC allows young people to work and study.
Two IFAD-funded projects in Nicaragua – the on-going US$38 million Inclusion of Small-Scale Producers in Value Chains and Market Access Project (PROCAVAL) and the recently closed US$28 million Economic Development Programme for the Dry Region of Nicaragua (PRODESEC) – offer up valuable lessons in education and technical development for young people.
“By providing access to education, new techniques and technologies programmes like PRODESEC and PROCAVAL are offering young people viable opportunities and an alternative to the drug trade, gangs or delinquency,” says Rubio.
More than 40 trade groups, that’s about 25,000 people, have received training through PROCAVAL to start new businesses and enterprises.
One great example of the project’s engagement with young people and education comes from the Soppexcca Farmer’s Union Cooperative. The coffee producer’s cooperative worked with PROCAVAL to strengthen value chains and productive capacity.
With their new income streams, the cooperative is investing in educational grants for the children of members. Around 90 per cent of young people associated with the cooperative have been able to access higher education, studying agronomy, engineering, nursing and other technical studies.
The project has a Women’s Centre that provides education on sexual and reproductive health to young women. They also provide school packets that include uniforms and books for school-age children of cooperative members.
Young people received training to become baristas in the cooperative’s cafes, product tasters and sales technicians.
Many young people involved in the project are also part of the “Muchachitos del Café” program. Through this program, they’ve learned more about the coffee value chain, and are now taking a lead role in educating older members of the cooperative on both business initiatives and basic reading skills.
“When we studied in secondary school, they asked us to teach four people how to read. We received the information we needed to do the job. It was very satisfying because the adults learned to write and read, and they felt very proud,” says one Muchachitos del Café member in the recent Procasur case study from the cooperative.
Another excellent example of engagement with education comes from the Rancho Grande and Waslala Cooperative in the department of Matagalpa. Procaval supported the project in organic cacao and free-trade certification by strengthening the cacao value chain and teaching farmers how to grow better, more valuable products.
Young people will be key to the long-term success of the enterprise. About one in three people in the primarily rural municipality of Rancho Grande and Waslala are between 15 and 29 years old. Around 70 per cent of people living in rural areas live in poverty, and nearly half of people living here are illiterate.
“The entire productive process is designed so it can be taken up by the young people, today is for the adults, but tomorrow – and I’m not talking about the tomorrow five years from now – tomorrow is for the youth,” says Saúl Divas, from the cooperative’s technical team.
Beginning in 2011, the cooperative began offering rural educational programs where young people and the children of cooperative members could study organic cacao production – including product inspection, warehousing and promotion – during intensive seminars that lasted around 12 days.
“Before the capacity-building exercises, before the project, I didn’t think about anything, I didn’t think that I could create anything to come out on top. Before, we felt marginalized,” says 29-year-old Marison Zeledón.
Insertion into labour markets
Job growth is one of the biggest successes of IFAD-funded projects in Nicaragua. The PRODESEC project provided employment opportunities for around 60,000 people.
In all, the programme supported over 400 business plans designed to generate rural employment. It provided technical and financial support to more than 300 businesses and worked with about 250 agro-industrial businesses to improve production levels and food security.
Most impressive was the number of young people involved in the project, with around 20 per cent of the business plans creating new jobs for young people in rural areas.
The Ay Qué Lindo cigar box factory has generated 40 jobs.
One such business is the Ay Qué Lindo cigar box factory. Prodesec provided the enterprise with a US$6000 initial investment to make the fine cigar boxes they are selling to an exporter. The young people that run the business took this seed money and built a successful business. They now employ around 40 young men.
“I was from the street, super lazy,” says Laimer, who works in the factory. “This has worked like a rehabilitation centre for me. It has helped so much. Now I contribute to my household, and I know how to bring dinner home for my family.”
Access to land and productive capital
“One of the biggest challenges facing young people is access to land and productive capital,” says IFAD’s Rubio. “Old people maintain control of these valuable assets, and young people end up migrating to the cities to find new opportunities. Once they get to the cities, they can either make the ultimate sacrifice and create a better opportunity for future generations, or they end up falling into a downward spiral of violence, crime and substance abuse. By providing real opportunities to build equity and truly take part in rural society as a whole, we are hoping to provide viable options away from violence, ensure food security for generations to come and create a rural environment that is robust, dynamic and inclusive.”
The Soppexca Cooperative is providing young people credit to buy land, and young people are pulling their resources to buy land together. Nevertheless, access to credit for young people remains a challenge.
Access to financial services
“Most people agree that access to credit and risk capital for young people is a major challenge in the region. The next generation of IFAD-funded projects is seeking to remedy this situation,” says Rubio.
The Ay Qué Lindo enterprise has worked a deal with their major buyer for a line of credit, allowing them to build the business, and IFAD-funded projects like PRODESEC have transferred millions of dollars to micro-enterprises.
“This is just the beginning,” says Rubio. “The new Rural Development Program for the Caribbean Coast (NICARIBE) is now ramping up it’s operations. The program will work with over 100 communities on the Caribbean Coast, allowing poor rural people living in these areas to improve productivity, access new markets, make more money and create better opportunities for their children.”
IFAD has collaborated with the Government of Nicaragua since the 1980s. Over this period, the Fund has mobilized approximately US$250 million, of which US$104 million was in the form of co-financing, benefiting some 670,000 people. Between 2005 and 2012, IFAD financed US$57 million in rural development activities in Nicaragua, with additional contributions of US$43 million from other sources.
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