by Ashley Tindall and Jeannie Wilkinson
The World Bank, through the rural investment component of its Indigenous and Afro-Ecuadorian Peoples Development Project (PRODEPINE), invested almost $70,000 in a sugar mill project in the Amazonian village of Chinimpi. The project has failed and the mill is silent. The cost of operating the mill far exceeds potential revenues at today’s price. The failure of the mill project occurred at every level: it was economically risky, as it depended on the production of high volumes of sugarcane to offset variable costs in an unstable commodity market; socially, it failed to consider local circumstance thus engendering disillusionment instead of empowerment; and politically, it weakened the ties between the community and indigenous organizations through mismanagement and distrust.
Despite the World Bank’s rhetoric that recipient communities were to participate in the planning of their project, Chinimpi’s choice of a chicken farm was turned down. In retrospect, the chicken farm would have been lower risk and better supported, thus eliminating or at least, ameliorating several of the problems confronted by the project. Likewise, the PRODEPINE violated its commitment to utilize ethnodevelopment when it imposed an Andean collective model on the Amazonian Shuar.
PRODEPINE chose to work through intermediaries – indigenous organizations that are often politicized – rather than work directly with communities. Unfortunately, in the case of Chinimpi, the original executing organization was lacking in: 1) the experience needed to plan and execute a major commercial project; 2) consideration for the village’s needs and concerns; and 3) fiscal responsibility, which was evident in its pilfering of project funds.
This first indigenous organization evidently had sugar on the brain; they were determined to develop commercial enterprises despite their very limited knowledge of sugar production and experience with markets. The success of the sugar mill was largely dependent on the high price of sugar and finding buyers, without which the capital and labor-intensive project would fail. Thus, PRODEPINE approved the risky project and watched from afar as the price of sugar fell precipitously.
The project has not turned a profit and cannot compensate the villagers for their donations of land and labor. We recommend the village forgo attempting to run the factory and instead sell it and use the proceeds for a chicken farm or a like project. Any project chosen should: be small-scale; have a short turnaround cycle; require minimal capital; and based on a subsistence or mixed, subsistence/commercial model.
In addition, we recommend the following for PRODEPINE II: