By Kate Schecter
News Americas, NEW YORK, NY, Weds. June 7, 2023: Most of those seeking to enter the US are fleeing Venezuela, Cuba, Nicaragua and Haiti. This is a shift from prior years, when most migrants and refugees came from the “Northern Triangle” areas of Guatemala, El Salvador and Honduras.
But fewer migrants from these Central American countries is likely a pause. Conditions have not improved there. Poverty, violence and corruption are endemic. Just in recent weeks, Guatemala’s government has banned competing presidential candidates.
Along with development experts and others, the Biden Administration understands the dynamics that drive people to leave their communities and families. Through its “Root Causes Strategy,” it seeks to attract primarily private companies to invest in these countries. These efforts to generate employment and income, including through the production of goods for export, could help. However, it is important to have realistic expectations about what relatively large scale outside investment can achieve when legal and other supporting elements remain weak. Even if this recent effort to encourage foreign investment in Central America is more successful than previous ones, its effects will take time to raise incomes and improve lives.
There is a different approach that has been underway for some years. It relies on capital accumulation generated by local communities, invested in businesses and other initiatives that meet their needs.
An example is what’s happening in Olopa, in Guatemala’s Chiquimula Department. Women there have traditionally made rope bags for their families’ use. With assistance from development organization World Neighbors and our local partners, women entrepreneurs have developed and incorporated different designs for their bags. With training in basic financial and marketing techniques, rope bag production has been successfully commercialized. Women sell their bags in Olopa and surrounding villages. The bag business is producing significant income for a large number of women.
This is income that helps coffee farmer families in particular diversify their income. That’s important, given coffee–like any commodity–fluctuates in price. As important, climate change is making it even more difficult to earn a living from just farming coffee beans.
Women bag producers contribute a small part of their profit into a savings and credit group. This group in turn makes loans to women who wish to start their own bag or other business or purchase implements or even additional land to expand farm output. Loans are always paid back and the amount available for credit expands over time. It is this type of locally driven capital accumulation that results in economic initiatives that meet local needs.
With assistance from World Neighbors and local partners, these women producers have organized themselves into the Association of Olopenses Women (AMO). With its success in Olopa, the AMO has expanded to Jocotán and Camotán. The AMO now encompasses 37 communities. The organization has about 700 members, 400 of whom are active. All but 15 are women.
Development initiatives like those embodied in the AMO are not a panacea, nor are they appropriate for every community. But they do show that communities in Guatemala and other Central American countries possess everything necessary to lift themselves from poverty. This includes the means to accumulate capital. As policymakers look to address the root causes of migration in Central America—and other countries—they should consider building on what already works.
EDITOR’S NOTE: Kate Schecter is CEO of World Neighbors.
