New interview for the Talking About Development Project: CIRILO OTERO -
GPC - Nicaragua. "Talking About Development" is a project
that brings together the ideas and experiences of seasoned professionals
working with issues of international development mostly in the
Americas.Please see www-personal.umich.edu/~fiatlux/td/ for the full
project.
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I interviewed Cirilo Otero during a visit to Washington, DC,
in October of 1997. We talked about his work with
development in Nicaragua, specially regarding food politics
and the external debt. The text below also includes an excerpt from a
platform document elaborated by his organization which
illustrates in current figures the problem of debt for
Nicaragua. His visit was sponsored by Witness for Peace.
Main topics: development, Nicaragua, hunger, food politics,
external debt.
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VB) Where do you work, an organization or university?
We are a non-governmental group which is working with
basic food production, with peasant organizations, with
organizations that provide credit to small and medium size
producers to grow food, mostly. And we are also working
with women's groups, with youth groups, and research
organizations and academics.
Our group is called GPC (Group for Proposals and
Lobbying). This group has as an objective to lobby and cause
impact on the government, that is, we work to lobby the
government to change its policies regarding economic, social,
cultural, human rights, and gender issues in Nicaragua.
Our main theme is food security. The group's concern with
food security was born in january of 1996, the year when the
World Food Summit was held.
We believe that with the structural adjustment measures
carried out in Nicaragua, that Nicaraguans have lost in part
the means to feed themselves. With each passing day, there
are more children and more adults that are undernourished
because they lack a balanced diet, and lack basic foods. We
believe that food security is linked to the ability of every
human being or family to acquire their food so that they can
develop in a healthy, egalitarian, and correct manner.
Right now in Nicaragua there are a great number of
Nicaraguans that are going hungry. There is a process of
unemployment, approximately 60% of the economically
active population is unemployed, they do not have jobs,
therefore, they cannot buy food.
Food production has diminished with an accelerated speed,
there is no credit available for peasant agriculture production,
there is no marketing and commercialization for the peasant
products. The Nicaraguan government has followed the
International Monetary Fund (IMF) and the World Bank's
policies to import basic grains.
The government is very happy to import basic grains, even if
they have to go into debt for it. It makes loans to pay for the
basic grain imports, but what happens is that even with the
imports for these basic grains, many Nicaraguans still do not
have access to the food.
VB) Can you explain further this process of importing basic
grains?
The Nicaraguan government buys wheat, corn, rice, etc from
other countries, by making loans and immersing itself in debt.
Sometimes it buys from countries in Central America,
sometimes in North America, from the United States, Canada,
or Europe... For example, we have received rice from Korea
and other Asian countries. They are also importing a great
deal of canned goods, from the U.S. and Canada, and are
introducing them in the domestic market.
VB) And what are the main products produced in Nicaragua?
We produce beans, corn, rice, sorgum, beef, oil, milk, eggs,
etc.
VB) And this national production is not sufficient to feed the
population?
Not only is it not sufficient, but the little that is produced is
sold to other countries in the region, it is exported. Because
the government gives priority for agricultural exports to
produce foreign exchange rather than to sell them to the
domestic market.
VB) So how would you explain food security for somebody
who doesn't know what it means?
I would say that food security is LIFE, that's how I would
define it. A person who does not
have the means to feed him or herself today and tomorrow
and all the days of their life, will not be able to be alive,
they'll die. That's the best definition. For each person, it is
to have the means to obtain the food that they need, but,
overmore, the capacity to produce this food. And on a
national scope, food security has to be: to ensure that the
necessary production and storage of needed food will occurr
for a determined period of time, which can be a year or more.
VB) What is your idea of development?
I believe that development should be done in a sustainable
way, that is, in a long term time period. We should not think
about development for the near future and regarding
immediate benefits for the generations alive now. We should
think of development as something that continues to grow,
encompassing the economy, human resources, material
resources, natural resources.
Therefore, development should be in harmony with nature, it
should be in harmony with men and women, and it should be
in harmony with the economy. If you don't have this
harmony, this process of communication, there is no
development. You may have macro economic indicators that
rise, but there is no human development.
VB) How have your ideas about development changed
through time?
Experience has shown me that development has to be
objective, it can't be theoretical (only), nor can it be simply
numeric figures on a piece of paper. Development needs to
be linked with the human and social reality that you live in.
The empoverishment that we have seen in Nicaragua and
which we are living through, the growing inequality between
rich and poor in Nicaragua, as each day goes by, there are
fewer rich people that are more and more rich, and there are a
greater number of poor people which are much poorer. And
this process we have located and seen ever since the
structural adjustment measures
have been applied in Nicaragua but the IMF and the World
Bank.
The IMF policies oblige us to concentrate a very large
percentage, more than 35% of our exports, to pay for the
interest of the external debt. And now that Nicaragua is very
much in debt, we are not even paying the principal of the
debt, we are only being able to pay the interest. And I can
add that there are many European countries that are aiding
Nicaragua, that are lending us money, but this money, instead
of going to Nicaragua for production, for social development,
this money is being used to pay the international banks that
Nicaragua owes.
"One merely has to examine the 1997 national budget to see
the disproportionate burden of debt service in Nicaragua. In
this budget, debt service payments make up almost 39% of
total budgetary expenditures, while combined amounts for the
Ministry of Health and the Ministry of Education are only
18%.
In order to finance the increase in debt service, funding in the
natinal budget for INTA (Nicaraguan Institute for
Agricultural Technology) was reduced by 54% in nominal
terms (64% in real terms). INTA is an institution that
provides technical assistance to small producers, a role
deemed essential by the financial institutions themselves.
Funding for INATEC (National Institute of Technology) was
cut by 81% nominal (91% real); funding for FONIF
(Nicaraguan Fund for Children and Families) was cut by
70.5% nominal (80% real); and funding for MARENA
(Ministry of the Environment and Natural Resources) was
cut by 26% nominal (36% real).
The main argument used tojustify paying foreigh debt service
is that, if it is not paid, it will be impossible to obtain the
funds needed to finance development projects and other
expenditures. However, in the 1997 budget, foreign debt
service payments amount to 11.2% of the GDP (Gross
Domestic Product), while funds received from foreign aid
only amount to 8% of the GDP. Debt payments greatly
exceed aid received, as 2.25 billion cordobas will be paid in
order to receive 1.61 cordobas.
Furthermore, the large interest payments impede efforts to
increase public saving, which is one of the ESAF's main goals.
The deep recession, with its, social and political costs, makes
it impossible to achieve public saving and is an omen for
future waves of instability in the country.
Even if there were to be 6% annual growth in GDP from
1997-1999, accompanied by 9% annual growth in exports,
the annual US$316 million burden of services and
amortization would represent between 32-35% of total
exports, which is obviously an unsustainable burden and
would limit any possibility of development.
The largest reductions in the foreign debt were obtained in
1996. In September of that year, Mexico forgave 91% of
Nicaragua's debt, the equivalent of US$1.01 billion. In
October a preliminary agreement with Russia on the
renegotiation of 90.6% of the US$3.44 billion debt was made
official. At the end of September of 1997 an agreement to
restructure the debt to the Central American Bank for
Economic Integration was announced. This will certainly
have an important impact on the burden of debt service.
At the end of 1996 the total balance of foreign debt stood at
US$6.11 billion, of which 66.9%, or US$4.09 billion, was
bilateral debt. That amount is broken down as follows: 1)
US$ 1.3 billion to the Paris Club; 2) US$1 billion to former
socialist countries; 3) US$1.4 billion to Latin American
countries; and 4)US$3 million to other countries, mainly in
Africa and Asia.
However despite efforts to reduce Nicaragua's foreign debt,
payment of the "prioritized" debt service has been increasing.
The net flow of liquid currency coming from international aid
(disbursements of liquid currency from international aid
minus payments of "prioritized" debt service) had negative
balances of US $53 million in 1993, US$ 35 million in 1994,
US$ 140 million in 1995, and an estimated US$ 126 million in
1996.
The nominal balance of the foreign debt on December 31,
1996 was approximately three times the GDP, and a little
over eight times the total amount of exports of goods and
services. Meanwhile, prioritized debt service payments
amounted to 12% of the GDP and 34% of the total amount of
exports of goods and services.
Therefore, success in reducing the foreign debt, and
willingness to make make debt payments, diverts scarce
foreign aid away from growth and development, and funnels
that aid abroad." (from GPC's platform document).
VB) And has your family influenced your profession choice
or your ideas?
No, life has influenced my decision to work with
development. I come from a very poor family, that more
than conservative was very humble and had little opinion
regarding the political and public life of Nicaragua.
VB) And when did you start working with development?
Well, I started doing agricultural research many years ago. I
have also worked with public polling. And now, in the last
three years, I have worked with the Nicaraguan environmental
movement. And this has allowed me to link myself with the
theme of development.
VB) What is your work with the GPC like?
Our Lobby Group emerges in Nicaragua to to confront the
incapacity of political parties, the incapacity of the
government, the incapacity of government institutions, the
State agencies, etc to solve the most urgent problems of
Nicaraguan society. So, our Lobby Group is an umbrella of
organizations composed of people and movements and
groups that are not part of the government, but which have
proposals and demands to transform the social, economic,
and cultural life of Nicaraguans.
Our Group has approximately 2 1/2 years of existance. Right
now we have 11 organizations that make up the executive
board, but each of these organizations has a great many
members all over the country, in the Atlantic Coast, in the
Pacific region, in the Center and North-Center and in the
Southeast. There are peasant organizations, agriculture
producers, women, youth, Christian, Protestant
organizations...
VB) And in this short time, have you been able to have
success already?
Yes, the government already recognizes us as a lobbying
group. Exactly at this moment, we are proposing to the
Consultative Group of Nicaragua, which is a group of donors
that organizes the Inter-American Bank of Development, we
are proposing a platform with three points: 1) we are asking
that the external debt of Nicarague be pardoned imediately so
that we can have a sustainable capacity of production and
that we should begin the World Bank's special initiative for
severely indebted countries. 2) We are proposing that the
international cooperation will direct the development of
production, of the capacity to produce, and social
infrastructure, that was totally neglected in the past seven
years. 3) Nicaragua should imediately elaborate a national
plan of sustainable development. This national plan has to
include civil participation, men and women from civil society,
who should participate to elaborate this national plan.
VB) What are the main obstacles that your group faces?
For the group, the most difficult obstacle that we face is that
we are not a political party. The political parties have more
influence in changing the government. Nevertheless, we feel
that what is really limiting us a lot also is the absence of
solidarity with other countries, specially with North-
American, where we need that the North-Americans tell their
politicians, their leaders, their government, that in Nicaragua,
many policies need to be changed, specially regarding
international cooperation. Because we have people dying of
hunger in Nicaragua, because Nicargua is a country where we
have no jobs, it's a country being victimized by the structural
adjustment measures.
VB) How does the current Nicaraguan government react to
all of this?
The current administration is very worried because it knows
that it does not have an orderly country to govern, it's a
country where there is a lot of hunger, and the government
needs to search for a solution to the hunger problem.
VB) Regarding the North-American side, what are the main
myths you think that North Americans have of Nicaragua?
I believe that North-American politicians do not know
Nicaragua. They often say that in Nicaragua we are all
Sandinistas and that's not true. There is today a very
dynamic society in Nicaragua, very agile, very capable and
interested in raising itself up, in improving its life conditions.
So I think North American people need to know more about
Nicaragua to then form an opinion.
VB) If you could talk to them about food policies, what
would you say?
Well, if we could talk about food policies, we would suggest
to the United States government and the people of the U.S.
that they support us so that we can produce our own food.
We do not want donations, we are not begging, we would like
that they help us to get to stand on our feet so that we can
produce our own food.
With the land that we have in Nicaragua, it is possible for us
to be self-sufficient in food. What is lacking is credit,
commercialization, information, technology, and the capacity
to put the products in the hands of those who need it.
VB) Is there a conflict of interests with the North-American
agriculture producers?
Traditionally we did not consume wheat as our food. We
have learned to eat wheat because of the donations and in the
last few years, because traditionally what we have always
produced and eaten is corn. And we would like to continue
eating corn. Nevertheless, we can also interchange different
foods, we can buy wheat, I don't object to it, but what we
don't like is to be totally dependent on wheat. Furthermore,
we feel that the products we sell should be bought at a just
price, just like the North-American products we buy.
VB) Is there anything I haven't asked that you would like to
talk about?
We would like to ask the North-American people to turn
their attention to Central America and in particular to
Nicaragua. Nicaragua needs the help and the vision of North-
Americans. We believe that the North-American government
invested a great deal of money in the 80s for the war (against
Nicaragua), and for peace, it hasn't invested much money.
We would like that they invest as much money for peace that
they have invested for war.
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Washington, DC. - October 1997 - Original interview in
Spanish. Copyright Vera Britto 1997. Distribution is permitted as long as
all text and copyright notices are distributed as a whole.