Coffee technification and diversification (local currency)

Mid-term evaluation covered the period 3/85-12/87 and was based on document review and interviews with Mission, Costa Rican Industrial Finance Corporation (COFISA), and Federation of Coffee Cooperatives (FEDECOOP) staff and coffee farmers. The project has been a remarkable success. Most project objectives had been reached in only one-half the time originally planned. By the end of 10/87 about 6,183 farmers affiliated with FEDECOOP received coffee renovation credit covering 6,882 ha. Total credit disbursed was $16,569,000. Evidence is strong that credit has been used to renovate old coffee plots and that yields are higher than planned. A strong loan recovery system is in operation for most of the cooperatives. Other aspects of the project need additional study. The crop diversification component, for example, appears to be progressing well; cooperative leaders and farmers seem enthusiastic about using marginal coffee areas for macadamia production (though not for cardamom), but the component is only in the early stages of implementation and needs continual monitoring. The technology transfer component has been less successful, but appears to be making some progress now that the project has modified its approach to the paratechnician concept. Other findings are that loan repayment, which is just beginning, needs to be carefully monitored to identify any emerging problems, and that some participating cooperatives may need help with financial management. The project teaches that it is possible to establish successful agricultural credit programs if profitable technologies are made available with the credit and an institutional mechanism is in place to extend credit and collect loan repayments in an efficient way. As almost all the loan funds available under the project have already been disbursed, USAID/CR is considering increasing the credit line.