In Praise of the Little Man in the Big Hat

“Comercio Justo” revives Nicaraguan Co-op’s

For us not a great year, 1979, was the year the Nicaraguan Sandinistas overthrew the brutal Somoza gangster capitalist dictatorship. The Somoza family helped themselves to the nations resources – even the manhole covers in the capital Managua were their private property. The Sandinistas where named after the small man in a big hat, whose image has graced thousands of solidarity t-shirts, Augusto Sandino led the small army of peasants and workers that defied US marines who occupied Nicaragua from 1912 until 1933. Following his example the Sandinistas were committed to improving the lives of ordinary Nicaraguans.

Next month at Latin America 2010 the grandson of the legendary Sandino, Walter Castillo Sandino will speak about his grandfathers’ legacy. Walter and his wife Marbely have written a biography of Augusto and of his importance in the struggle to build Latin American unity.

One policy of the modern Sandinistas was land reform. The transfer of land to the campesinos helped create the modern Nicaraguan co-operative movement. Land reform was not well received in Washington however, triggering the dirty “Contra War”. This illegal covert US intervention did enormous damage to the fabric of the country leading to the deaths of over thirty thousand Nicaraguans.

Worn down from the struggle against the Contras, in 1990, the people elected a right wing coalition lead by Violeta Chamorro which put the country’s farmers under enormous strain. A new wave of co-operative formation occurred in defence of the land the campesinos had gained and to improve access to markets and credit.

In the dark days after the end of the International Coffee agreement which caused the collapse of six banks in Nicaragua the fair trade movement came to the rescue. Thanks to alternative trading organisations in the developed world, like Oxfam, Equal Exchange, Twin Trading and even the Body Shop, (Anita Roddick was a great friend of Nicaragua) the small farmers of Nicaragua gradually became owners of the whole production chain of products like sesame seeds and coffee.

The success, of the co-operative fair-trade sector, did not go un-noticed. After ignoring fair trade for a decade the likes of Nestle, Starbucks, McDonalds and even Walmart decided that if they could not beat it they would join it but for most of them this was a marketing ploy rather than a fundamental change in ideology. The farmers found themselves back in the same set of abusive relationships that had driven them to form co-op’s and take up fair trade in the first place. Fortunately in 2007, the Sandinistas where returned to power just in time to take advantage of a new force in Latin American trade – the “Alianza Bolivariana para los Pueblos de Nuestra America” – ALBA.

ALBA was formed in reaction to the US attempt to foist a free-trade agreement on Latin America. Nicaragua joined Venezuela, Cuba, Bolivia, Ecuador, the Dominican Republic, Antigua and Barbados, Saint Vincent and the Grenardines, and Honduras. Unsurprisingly Honduras left after the recent coup.

ALBA is committed to “Comercio Justo” or fair trade as well as food security and empowerment. Support is given to small producers of, rice, beans, maize and to raise cattle for the local markets with any surplus being available for export to other ALBA countries.

In Nicaragua ALBA works in partnership with CARUNA (National Rural Cash) which administers the scheme. It receives 25% of the value of the Venezuelan oil company PDVSA’s sales in Nicaragua. With this loan fund CARUNA has lent over £22million dollars to 10,000 small farmers organised in 57 co-operatives. This has supported fishing projects, housing, public transport, micro-enterprises, as well as the improvement of agricultural inputs.

The result was an increase in both the quantity and quality of products as diverse as milk, chicken, bananas and coffee. As the co-operative sector is 70% of Nicaragua’s agricultural economy the impact has been phenomenal. In 2008 the value of Nicaraguan exports was just $27million, rising to $109m in 2009 and set to reach $239m in 2010.

There can be no doubt that the legendary Sandino would approve of this initiative which is liberating the people of Latin America from the backyard of Uncle Sam!

For more information on Latin America 2010 visit: www.latinamericaconference.org