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Central American University - UCA  
  Number 182 | Septiembre 1996
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From Penniless Plot Holders To Peasant Producers

Will the next government preserve the important gains of the agrarian reform? The key is helping the former cooperative members of the 80s, now plot holders plagued by crisis, become peasant producers. Every candidate is faced with this challenge.

Yurí Marín

The idea isn't to sell the land, but to work it and bequeath it to our children," says 42 year old Juan Gómez, former hacienda worker, agrarian reform beneficiary and member of the Enrique Schmitz Cooperative, located north of Masaya. "But with the problems we have, every day is harder. The bank won't lend us money because some of us still owe. We get very little from our plot of land because we can't buy either fertilizer or insecticide. And to make it even worse, we don't know if the government that wins the elections will want us to leave the land, because we still don't have our land titles. The way things are going, we may end up selling the land to the big guys around here. Three members of this cooperative already did that."

There are over a thousand families other like Juan's in this zone, who received land during the 1980s and now find themselves closer than ever to selling it because of the legal insecurity and acute economic crisis. This is a general problem throughout Nicaragua. The possible winners of the crisis will be former and new landowners who buy the land cheaply and accelerate the agrarian counter reform process. The loser is the whole country. If things do not change, this negative process will culminate in about six years when almost all the agrarian reform lands will be in other hands.

Was the Past Better?

During the Sandinista government, some 1,200 Masaya families benefitted from the agrarian reform with over 3,500 acres of land. Eighty percent of the total reformed area, and 10% of all farms in Masaya, was on the northern plainthe best lands and traditionally planted in cotton. The lands were primarily given to peasants in collective form to work as production cooperatives. The FSLN government complemented this policy with solid support to these families, providing credits and imported inputs at very low prices. This put them in a privileged position compared to other peasants, although the economic results left much to be desired.

After the Sandinista economic adjustment in 1988, and even more after the change of government in 1990, almost all the Masaya cooperatives and those in the rest of the country as well found themselves seriously affected by the new rules of the economic and political game, in which all subsidies were abandoned and payment was demanded for debts accumulated with the state development bank. The cooperatives were also affected by the legal problems over land ownership that have generated so much insecurity among the peasants. Above all, they had forgotten peasant production techniques, the only appropriate alternative to the imported technological packages to which the Sandinista model accustomed them.

All of this has made rapid adjustment to change difficult. "Before, we had everything," noted Luis Hernández, another agrarian reform beneficiary from northern Masaya. "We got credit and technical assistance and inputs. We weren't worried about preparing the land, because we had a tractor. And if the tractor got ruined, they gave us another and another. Today we don't even have oxen; if we want to plant, we have to rent them."

Idle and Over Exploited Land

To deal with the crisis, Masayans and many peasants from other areas of the country have had to divide up their cooperatives, carrying out what has been called the "new peasant initiated agrarian reform." The collective debts also had to be divided up individually. In many cases, as in the Martín Alemán Cooperative, the only way to pay the debts has been to sell part of the land and other collective goods then divide the rest of the land equally among the members. This cooperative had to sell 18 acres and a tractor to cover its debt with the bank.

Today, 90% of the families that make up Masaya cooperatives have some sort of collective property ownership but produce individually, which creates great insecurity. The cooperatives are also completely decapitalized, leaving their members without the basic means to work. The severe financial restrictions do not let the members produce enough to generate a surplus that would permit them to improve their living standard and reproduce the farm. It is a vicious circle that generates new vices. First, it generates idle land: peasants cannot cultivate the 2 to 3 acres of land available to each head of family. Second, it generates ever more sterile land: peasants exploit the land as if it were a strip mine. In addition to getting low yields from the extractive cultivation practices--not returning to the land the minimum nutrients it needs for its reproduction, due to lack of economic resources to buy them--this method forecloses on the land's future fertility.

So far, nongovernmental and state support to deal with the lack of liquidity and encourage sustainable farm management has been inadequate. Furthermore, the majority of the NGO operating strategies--revolving funds that do not multiply, subsidies and inappropriate technology transfer mechanisms--have not been influential enough to put these families on the path to development.

To alleviate the situation, some peasants have begun to seek employment and income alternatives by migrating to cities and neighboring countries. This is the case of Luis Hernández's 23 year old son, who went to Costa Rica some months ago. "Yes, he went to work on the banana plantations. They say that you aren't treated well there, but at least I have the hope that he'll return with some money. He's a good worker and perhaps then, in the second planting, we can plant beans and sell them well in December," explains Hernández with some hope.

Nine out of Ten don't Live on their Land

The land problem and the search for a solution to the crisis are complex. One essential fact is that the majority of these peasants in northern Masaya do not live on their land. Nine of every ten live in groups of houses or along roads, and must travel several kilometers to temporarily cultivate their plots, with the consequent travel costs. The most serious aspect of not living on the plot is that it seriously affects care of the crops and does not permit long term investments--fences, trees or animals--that require permanent care.

But why don't they live on their land? Because, as in Ariel's case, they are not guaranteed basic water and electricity services. Ariel is 38 years old, lives in Las Pilas Orientales and owns land some 10 kilometers from where he lives. "It takes almost two hours to get to the plot, depending on whether we go on bicycle or on foot. During planting, we spend the whole day there, but since there's no water or electricity, we have to return home when it gets late."

The majority of lands affected by agrarian reform were dedicated to medium or large scale cotton or cattle production before the 1980s, and never had water or electricity. This problem did not exist in the Sandinista years, given the prevalent mode of working the land collectively and living in groups where basic services could be guaranteed. Today, with the cooperatives split up and the land divided into blocks of 2 4 acres, each family would like to build its own house, making water and electricity imperative.

The Agrarian Counter Reform Forges Ahead

It is very difficult to make a precise calculation of the amount of reformed land that has already been sold in Masaya, but it is estimated that at least 10%--approximately 600 acres--has passed into the hands of former landowners and new buyers. The buying and selling transactions are relatively simple. Although, by law, agrarian reform lands cannot be sold until the year 2000, in fact all that's needed is an agreement between the buyer and seller that both want the transaction to take place, paying a sum of between 1,200 and 2,400 córdobas per acre--depending on the location and the greed of the buyer or seller--and making a promise of sale, authorizing the buyer to use the lands. In the year 2000, the lands will automatically have another owner and can be registered in that name.

A lot of land has already been bought in Masaya--and in the rest of the country--with this simple mechanism, which is threatening to become generalized. It thus puts at risk one of the most transcendental achievements of the Nicaraguan revolution: democratizing property, giving peasants access to land and thereby guaranteeing greater social equity in rural areas.

The Plots are Viable

There is still time, however, to avoid the risk of such a serious reversal, and with measures that are also simple. Why should one support the strengthening of agrarian reform achievements, betting on the peasants? Wouldn't it be better for market forces to take charge of resolving the problems, displacing the inefficient so that others can take their places?

This is not an attempt to support this sector out of simple philosophical altruism, but to think about the country. And from that perspective, it has been shown that small production units, which make better use of imported resources, labor and land, are more efficient than the large production units of cotton, sorghum and cattle, the most common agribusinesses in the region.

In addition, there are now concrete examples of peasant reform beneficiaries who have successfully made the transition from poor peasants to peasant farmers, simply by resolving some key problems like land deeds and access to certain resources. That is the case of Francisco Vivas, who, after leaving his cooperative and then getting his land deed, has been living on his 2.5 acre plot for a year and has now planted over 1,000 fruit and firewood trees, has various harvests throughout the year and raises pigs and chickens, generating employment for himself and his whole family all year. Focusing on these people is justifiable. If this prioritization is joined with encouraging nontraditional export production (cassava, quequisque, sesame, peanuts, fruits) it is even more justifiable.

Transforming these small plot holders into farmers should also be seen as a way to promote greater social equality, and as a necessary condition for guaranteeing genuine political stability and social peace in rural areas, all so needed in Nicaragua.

Individual Deeds: The First Step

Individual deeds are unquestionably the first step to unchain the sleeping strength of the plot holders and thereby initiate sustained investment in their farms. But having an individual deed does not by itself guarantee that the plot holders will get out of their crisis. An example is the case of six former members of the Martín Useda Cooperative, recently deeded, who later arranged to sell their lands to their neighbor, one of the region's strong cattle ranchers. Individual deeds are necessary but not a sufficient condition to reach the strategic goal: that the peasant move to the farm and capitalize it. It also depends on resolving access to other basic production services such as water, financing and technical assistance.

What should be the strategy to make agrarian reform irreversible in Masaya and other areas of the country, impeding the advance of the agrarian counter reform?

Agrarian reorganization must be completed and peasants must receive basic capital, with carefully selected loans for land deeds and fences, and more long term credit based on reforestation. This is one experimental path that, among others, is already showing that it is possible for 60 70% of peasants to increase capitalization and improve their living standard.

In any case, the first thing is to support the process that ends with the legalization of individual land possession. The plot holders are the ones most interested in this process. Nemesio Narváez, of the July 16th Cooperative, recently received his individual deed, together with 15 other members. "Thank God," he said. "Now I can plant what I want to on my little plot of land and, since there are water and roads nearby, now I'll build my house there, and move in as soon as possible."

Water: Another Step

The efforts that have been made to date around individual land deeds are still insufficient. The initiatives have not yet become an authentic mass movement. Achieving this requires true institutional support with the participation of the Agrarian Reform Institute, NGOs and members of civil society who have something to do with this sector. The objective is to guarantee individual deeds to all the land in the least time possible.

Other proposals also need to be supported: exonerating individual deed processes from taxes, creating a Mortgage Bank to orient the land market, and giving small producers greater advantages to participate in the buying of land that some plot holders cannot work.

With the legal land ownership problem resolved, the second step, especially in northern Masaya, is access to water. Water gives the peasants greater possibilities of definitively moving to their plots of land. Building wells in Masaya is very costly. The subsurface water level is up to 6,600 feet deep and the few working artesian wells are very dispersed. Water is sold at a high price. In San Ramón, one of the department's driest zones, a barrel of water costs 8 córdobas, nearly a dollar. And carrying the water to the plot requires oxen, which are a dream for the majority of plot holders.

Water is key. It allows tree planting and animal husbandry. Trees and animals cannot prosper without permanent care. There is no care if the peasant doesn't live on the plot. And to live on the plot water must be assured. "If I had water nearby in Las Pilas, I swear I'd be living there, and other members say the same," says Luis Hernández, who has serious difficulties just caring for the squash he has planted on a third of an acre, precisely because of the water shortage.

In other areas of the country, an abundance of creeks and springs minimize this problem. In Masaya, resolving the water issue requires a high level of organization and political will on the part of institutions and organizations working in rural areas. A good diagnosis is needed of the region's current potable water network--sources, community distribution, current state of the wells and pumps, pumping capacity, etc.--so a reactivation plan can be proposed with defined priorities to benefit the greatest amount of reformed land and the greatest number of communities.

There's Will and Now There Are Results

There also needs to be a financing strategy for these projects, without dismissing the possibility that one part can be self financed by the plot holders themselves. "We need water and we're willing to assume part of the installation costs if necessary, as well as offer the labor," proposed some members of the Martín Alemán and Auxiliadora Marenco Cooperatives. These coops are in the Los Altos sector, where water is a viable possibility, given the closeness of their lands to a well abandoned some years ago.

Finally, to help plot holders settle on their lands it is necessary to open rural institutional financing sources, with both long and short term credits focused on those families that have real possibilities of being competitive. Some organizations, like Nitlapán, with its network of local banks and its "Trees are Valuable" program, have already begun moving in this direction, financing tree planting, fence building and oxen purchasing with long term loans, and providing short term credit support for working capital, all of which is linked to technical assistance. The results are very satisfactory.

Hitting the Bull's Eye

It's hard to make a farm. Converting a poor peasant benefitted by agrarian reform into a farmer costs over a thousand dollars, including the cost for subdividing and deeding the land, housing, fences and basic working capital. Land division assumes topography and legal services costs as well as taxes. The peasant family's move to the land implies fences to delimit the property, tubing and accessories to carry water, etc. There are also the costs of decent housing, though in the short run there are good solutions with local materials.

The majority of peasants in Masaya and the rest of the country have decided to spend whatever necessary to have security and the real possibility of living on their farms. A development program that promotes land deeds, water, technical assistance and financing would hit the bull's eye so that agrarian reform peasants, and Nicaraguan peasants in general, can consolidate on their land.

Accelerating this process requires joint efforts by the the new government and all the organizations that are now working in isolation, starting with a non ideologized debate about this sector's potential, with the recognition that no one has the absolute truth and that only together can we help producers advance in this country, particularly those whom agrarian reform made into landowners.

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