Nicaragua, CAFTA, & CIPRES


icaragua is almost the size of Washington
state with a similar population density. Its greatest physical resource
is its rich land, with about five acres of good farmland per person.
Agriculture is the cornerstone of the economy, providing over 60
percent of Nicaragua’s export income and over 40 percent of
its jobs. Half of Nicaraguans live on small-to-medium sized farms
and produce 80 percent of Nicaragua’s food. 

Life is still hard in Nicaragua, as it has been for centuries, first
under conquest by the Europeans, then the North Americans. There
was a brief period of hope after the Sandinista revolution overthrew
the U.S.-backed Somoza in 1979. Literacy grew swiftly from less
than 50 percent to over 90 percent. Effective agrarian reform policies
returned stolen land to farmers and farm cooperatives, provided
affordable loans, technology, and technical support, and partially
shifted production from export (for profits to foreign capital)
to internal food production for sustainable self-sufficiency. Infant
mortality dropped, the death penalty was eliminated, and labor and
agricultural unions were accepted. 

Reports from the Inter-American Development Bank, Oxfam, and others
highlighted Nicaragua as an example of effective social and economic
progress on behalf of the poor majority. 

By 1990 Reagan’s contra war had destroyed this shining example.
Exhausted, terrorized, and embargoed-back-to-poverty, Nicaraguans
“elected” the U.S.-designated client government and the
trends once again began to reverse: 

  • Literacy rates are in decline and malnutrition grows 

  • Nicaragua is the second poorest country in the Western Hemisphere 

  • About 70 percent of Nicaraguans earn no more than $2 per day,
    the World Bank’s definition of poverty, and 20 percent live
    in extreme poverty, earning less than $1 per day 

  • The average monthly wage is $36 

  • One out of every three children is malnourished 

  • Over half of the 900,000 schoolage kids cannot afford school 

  • 45
    percent of all income goes to the richest 10 percent of the population,
    while only 14 percent goes to the poorest 

  • Since the end of the Sandinista period of the 1980s, farmers have
    received negligible credit, technology, and technical assistance 

In October 2005 I joined a Witness for Peace delegation to Nicaragua
composed of a dozen citizens from Washington and Oregon. We met
with several stakeholder groups, such as the National Union of Farmers
and Ranchers (UNAG), the Rural Workers Association (ATC), the Center
for Rural & Social Promotion, Research & Development (CIPRES),
a coffee producers’ union for small farmers (CECOCAFEN), a
fair trade association, research groups, and an economist from the
Center for International Studies. 

We visited agricultural cooperatives in the campo (the rural countryside).
We also saw sophisticated, diverse, yet complexly integrated, sustainable
agricultural models operating at the family-farm scale with appropriately
selected technology for the current economic conditions. At a CIPRES
research facility, for example, we saw effective grey-water treatment
systems generating nutrient-rich water for plants and worm beds
generating organic fertilizer. 

Under the CIPRES model, these sustainable family-scale farms aggregate
into cooperatives, which in turn aggregate into larger organizations
that can both disseminate information and represent them as political

Since 1998, a CIPRES project has rebuilt the lives of 5,000 rural
families, providing animals, seed, irrigation equipment, grain silos,
and training to produce both sufficient food, as well as bio-gas
and fertilizers from animal waste. Project results were: increased
production of eggs, dairy products, chickens, fruit, and vegetables;
improved health and diet; sufficient bio-gas for cooking fuel and
a 50 percent drop in firewood consumption; revolving credit cooperatives;
reforestation; and more pasture. Extension of the CIPRES model to
75,000 families could lift them out of extreme poverty, sustainably,
at a cost of about $30 million. 

Rich land and sophisticated knowledge of biologically wise, holistic
solutions to food security were in abundant evidence. 

Obviously Nicaragua is quite capable of sustainably feeding its
people well. But there are no jobs, so nearly 20 percent of the
people have migrated abroad, sending $600 million per year to families
at home, an amount equal to one fourth of Nicaragua’s GDP.
These funds are Nicaragua’s greatest source of vital foreign
exchange. For many, only material aid from church groups, NGOs,
and Nicaraguans working abroad make it possible to meet their basic
survival needs. 



he stakeholders we met strongly opposed CAFTA.
Already World Bank-imposed structural adjustment programs designed
only to insure debt service have resulted in the privatization of
public services, such as communication and electricity (and have
attempted to do so for water). The promised “efficiency of
privatization” has not occurred. The only “efficiency”
realized has been profits to private multinationals resulting from
price increases, cutbacks in labor, reduced maintenance quality,
and cutoffs of a growing sector with less and less ability to pay.
Long-term economic stability has been sacrificed. 

Coffee production has long been critical to Nicaragua’s vital
foreign exchange, accounting for 27 percent of Nicaragua’s
exports and one-third of its agricultural employment. Over 300,000
livelihoods depend on it. Coffee, then, comprises part of Nicaragua’s
“comparative advantage,” according to the World Bank’s
neoliberal framework for the developing world. But World Bank structural
adjustment programs have encouraged other countries, such as Vietnam,
to export more coffee (as they had encouraged Nicaragua to do in
the past). The resultant glut on the world coffee market has been
devastating for Nicaraguan coffee producers. Prices dropped drastically
in 2002 to well below production costs. Yet consumer prices in the
U.S. did not drop as large, transnational coffee distributors benefited. 

CAFTA will require eventual removal of the tariffs that now slightly
protect Nicaraguan farmers and subject them to unlimited dumping
of subsidized products from the U.S. It will be just like NAFTA
in Mexico where income drastically dropped for 15 million small
producers and forced over a million families off the land and into
Free Trade Zone (FTZ) sweatshops. Mexican agricultural production
has halved in the decade of NAFTA. Though some of it looked good
on paper—a tripling of foreign investment into FTZs, a doubling
of exports from FTZs, and 800,000 new jobs after 7 years— this
“trade” was merely “paper transfers” that contributed
povertylevel wages to the Mexican economy. Raw materials were “imported”
into the FTZs, assembled products were “exported,” but
the dollars and profits passed right through to multinationals.
Even the poverty-level wages were short term: most of those 800,000
jobs are gone, as the multinationals “found” cheaper labor
in other depressed and desperate FTZs. 

There are proven alternatives, for example the CIPRES program that
could sustainably lift 75,000 families from extreme poverty for
$30 million—$400 per family— about a tenth of Nicaragua’s
annual debt service on a principal already paid several times over.
This unjust debt was built by U.S.-imposed governments, war, and
economic embargo. 

new “trade” agreements are really “protectionist
policies” for multinationals and their investors. They usurp
local, regional, and even national sovereignty, the very backbone
of democracy. 

Meanwhile, in agriculture we produce enough to feed everyone, but
have not yet applied the technical, social, and economic tools to
insure this wealth is sustainable (by moving from fossil-fuel-based
inputs of over five calories for each calorie yielded to organic
methods that reverse the ratio), distributable (diversified regional
production) and accessible (affordable to the poor, too). 

Hating the corporations and governments who serve them resolves
nothing. Changing them into transparent, accountable, and responsible
servants of a democratic humanity resolves everything. We can easily
predict they will be the last to see that resource scarcity is obsolete
and we no longer live in world of “either us or them.” 

We may soon realize that we need our Nicaraguan sisters and brothers
as badly as they need us. 


Nuess is an educational consultant, primarily in the fields of energy
and building science. He is the author of

General Plenty:
Always and Only the Path to Peace