In my travels to Central America I have seen with my own eyes the suffering that the collapse of world coffee prices and the severe drought are causing throughout the region. I have seen desperate families and children going hungry or malnourished.
The lack of rain during the last year has created a “drought corridor,” running north-south between central Honduras and down into northwestern Nicaragua. Throughout the region there are food shortages, malnutrition and more poverty. The oversupply of coffee on world markets has driven prices to historic lows and caused great hardship to coffee producers and coffee workers in the region. Over the past year, in Central American coffee producers lost about $1.5 billion and some 600,000 coffee workers have lost their jobs.
President Bush is very concerned with the current situation in the region and has instructed the U.S. Agency for International Development (USAID) to provide assistance. We have responded quickly. This year alone we have provided $10.1 million in emergency drought assistance to Central America.
With hunger our main concern, the distribution of most emergency food aid in Central America is through food-for-work projects aimed at improving long-term food security and rehabilitating community infrastructure such as roads and water and sewage systems. However, where warranted, we have used free rations to target malnutrition in children under age 5. In addition to emergency and food aid, we are providing seeds and other agricultural inputs to farmers in the affected regions.
USAID and its partners have worked in close cooperation with the World Food Program, UNICEF, and local governments to coordinate all emergency operations. These efforts have been essential in helping national governments mobilize other donor resources and come to grips with the crisis in their own countries.
In Guatemala, for example, USAID provided emergency rations, medical supplies, diarrhea and pneumonia treatment and immunization and vaccinations for those children most at risk in rural communities.
In Nicaragua, our mission implemented an emergency food for work program to provide employment for 13,000 heads of households, which benefited 80,000 people in coffee-growing areas. USAID also has activities in El Salvador to promote nontraditional crops, such as sweet peppers, sesame, organic coffee and cashews, for which verifiable demand exists in domestic or overseas markets. The program has provided help in marketing, training in improved practices, and technical assistance in farm management techniques to nearly 20,000 small producers.
This year USAID signed a Quality Coffee agreement with Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, the Dominican Republic and Panama. Under the terms of this agreement, USAID will provide $8 million dollars for a program to assist small and medium-sized coffee producers to improve coffee quality and form new business linkages. The program will also secure longer-term contracts with the specialty coffee industry and identify and implement crop diversification options for producers that cannot be competitive.
USAID is also partnering with private corporations and organizations to provide assistance. We recently signed, for instance, an agreement with Green Mountain Coffee Roasters of Vermont to assist coffee-producing countries affected by the sharp fall of world coffee prices. The agreement will support the development of small- and medium-scale coffee producers that are environmentally, socially, and economically sustainable. This will improve livelihoods and incomes for coffee farmers and their communities while maintaining a reliable supply of coffee in the range of qualities demanded by consumers.
While we are committed to help the region overcome the present food security challenges, we also want to focus on helping countries keep their economies on solid footing. It is our intention to provide short-term support where it is needed, but our focus will be on longer term adjustments in the rural economy.
Through its Opportunity Alliance program, USAID will provide significant new assistance to help countries move from traditional farm-based production to agri-business-based production. This program provides $8.5 million this year to assist Central America and Mexico in realizing opportunities for trade, investment, and rural economic prosperity. By stimulating public and private partnerships, USAID will enhance crop diversification, help producers adapt to changes in the market, and provide training to producers so they can become more competitive.
We will continue to monitor weather conditions and crop production. We are also considering a food security early warning system, which will help cope with future emergencies and target families most at risk.
President Bush has said that “as a nation founded on the dignity and value of every life, America’s heart breaks because of the suffering and senseless death we see in our world.” That’s why the United States will continue to work with our neighbors in Central America to help them overcome this terrible crisis.
Adolfo A. Franco is assistant administrator for Latin America and the Caribbean for the U.S. Agency for International Development (USAID).