Prodecoop in Nicaragua

One of the most important roles of Fairtrade has been to help build and sustain farmers’ co-operatives. In Nicaragua, when the leftist Sandinista government lost power in 1990, farmers’ co-operatives found themselves without any government support. They formed co-operatives to provide marketing, credit, and other programmes. Prodecoop (Promotion of Co-operative Development of the Segovias region), was the first such organisation. Rosario Catellón, co-founder of Prodecoop, tells the story: “In 1991, the first co-operatives that today make up Prodecoop first exported to the U.S. based fair trade coffee buyer, Equal Exchange. Some of the co-operative members of Prodecoop had taken out loans during the Sandinista revolution, but the new government demanded immediate repayment. The bank held their coffee crop as collateral, and put their land into foreclosure. The representatives of the member co-operatives came to the Prodecoop offices with this difficult situation. “Jonathan Rosenthal, then Executive Director of Equal Exchange, listened to the co-operatives, and took the risk that no bank or other financial institution was willing to take. He advanced us a portion of the purchase of our coffee. After negotiations with the bank, Prodecoop bought the coffee back from them, promising to apply all the income from the sales to pay off the co-operatives’ debts. “Equal Exchange contributed to bringing Prodecoop out of anonymity. They were the first buyer of our coffee, and helped to make it known in the North American market. Jonathan Rosenthal and Equal Exchange have been dedicated to building bridges, so that those who have historically been at a disadvantage can pass over to the other side, where the coffee industry is, and break the long chain of intermediaries. In this way, they can access better incomes; alleviate poverty; achieve economic, environmental, and social sustainability; and most of all regain their hope for the future and for themselves. The small farmers of Prodecoop never imagined that they would, over and over again, be sitting down to negotiate face-to-face with North American and European coffee importers and roasters. Prodecoop has been an example for the country and the world. It has motivated the resurgence of many co-operatives of small farmers in Nicaragua and in other countries.”

Article Source: Published by Food First.