The Common Good
January-February 1997

A Stubborn Hope

by Jeff Shriver | January-February 1997

Poverty is now the enemy as Nicaraguans battle on.

In the 1980s, approximately 100,000 U.S. citizens traveled to Nicaragua. Some arrived to document the effects of the U.S.-sponsored war. Others picked coffee in organized brigades, or brought humanitarian aid in medicines and foodstuffs. Still others painted revolutionary murals in the cities.

In 1997, Nicaragua is no longer a land of revolution and Cold War battles. It is neither idealized nor detested by the rest of the world. Nicaragua finds itself in a long line of poor countries indebted in the billions, forced to use scarce resources for debt repayments instead of social programs.

After the fall 1996 presidential election, politically polarized Nicaraguans can agree on one thing: They are tired of leaders who promise the sky and, once elected, use precious resources to enrich themselves and their friends. A succession of corruption—including the overt corruption of the Somoza dynasty, the "piñata" of 1990 which parceled out vast amounts of wealth to the Sandinista leadership, and the Chamorro administration's friends who enriched themselves from "privatization" in the '90s—has fueled distrust and cynicism toward government. President-elect Arnoldo Aleman is off to a shaky start; 10 political parties brought allegations of electoral irregularities by Aleman's party in the recent elections.

The positive fallout of the lack of confidence in government is that Nicaraguans are looking toward new, creative strategies to combat poverty. These new efforts involve a broad sector of actors on community, national, and international levels; are less paternalistic than past development schemes; and involve more participation from the poor.

Indeed, workable solutions are urgent as poverty is getting worse and continues to tear away at the social fabric of Nicaraguan society. Unemployment is at a staggering 60 percent. Since 1990, banks have all but shut their doors for loans to small farmers and businesses. As a result, farm land has been deserted and businesses have gone bankrupt. Thirty-seven percent of all Nicaraguan households are headed by single women.

THE MUCH HERALDED opening of Nicaraguan borders to free trade has impacted Nicaragua's small producers much like a Mack truck impacts a fly. Local shoemakers now compete with Nike and Reebok, and rice farmers with Texas long grain. "Our biggest problem is the free market," said Cornelio Rivera, president of a basic grains cooperative in the northern mountains of Nicaragua. "There is a great supply of rice coming in from the outside. We don't have the markets, the credit, or the infrastructure to compete." Moreover, hundreds more assembly-for-export factories are expected to appear under the Aleman administration.

As social problems increase and government solutions are few, non-governmental organizations have grown in size and strength since 1990 and are playing a more crucial role. In response to unemployment and plummeting production levels, alternative credit programs have been formed that prioritize loans to small businesses and small farmers. One such program is the Nicaragua Community Development Loan Fund (NCDLF), both a social investment fund in the United States and an alternative form of credit for the poor in Nicaragua run through the Nicaraguan Council of Protestant Churches (CEPAD).

When foreign donations to Nicaragua started to dry up at the end of 1991, CEPAD formed an innovative lending partnership with the Wisconsin Coordinating Council on Nicaragua, by which U.S. investors could loan money to Nicaraguan farmers and merchants. Mothers in Wisconsin, a neighborhood in Chicago, and a church in California have teamed up with rice and bean farmers in Matagalpa, furniture and shoemakers in Masaya, and tortilla makers in Managua to make possible community based economic development.

Estela Lopez lives in Acahualinca, a Managua barrio near the garbage dump where she finds parts out of which she creates new appliances. Estela, who has never before received formal credit, has borrowed four times from the NCDLF to buy new appliance parts for her business. Women like Estela are becoming a major focus of community development programs in Nicaragua, especially in the alternative credit sector. Typically women are less prone to spend income on luxury items, rum, or cigarettes and are more likely to invest in schooling, medicine, and food for their families.

Group lending promoted by the NCDLF—including loans to solidarity groups, village banks, cooperatives, and worker-owned businesses—is helping to place the poor themselves in the center of their financial systems, and enables the poor to build sustainable access to resources.

Delegations of U.S. citizens continue to enter the country, if for different reasons than those who came in the '80s. Delegations say they still find a revolutionary spirit alive in Nicaragua. The spirit is perhaps less visible in the government or in political parties. But it remains lively in the hearts of people, a stubborn hope in the face of incredible hardship.

JEFF SHRIVER, a former Sojourners staff member, works with CEPAD's community development credit program. The Wisconsin Coordinating Council on Nicaragua, which enables U.S. investors to loan money to Nicaraguan farmers and merchants, can be reached at WCCN, P.O. Box 1534, Madison, WI 53703; (608) 257-7230; e-mail: .

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