Evaluation of the Chapare regional development project 511-0543

The Chapare project was the "carrot" by which coca producers were to be induced to leave off their highly profitable operations and switch to alternative crops through the use of incentives such as cash rewards for eradication, loans for financing conversion to alternative crops, research and extension to promote alternative crops, and training and infrastructure development. The "stick" was to come from a special Government of Bolivia (GOB) strike force, UMOPAR, operating with the support of the U.S. Embassy but independently of the project, or "carrot". The enterprise began badly. The international demand for coca grew very quickly fast in the 1980's, followed by rises in coca prices. This led to a boom in the number of Chapare farmers wishing to cash in on the soaring demand for coca. Market forces began to reign freely, with total disregard for Bolivian laws or norms. In fact, the cocaine traffickers effectively ran the Chapare as a free-trade, free-fire zone for several years. This situation was partially a result of a national political crisis, complicated by an economic crisis in the 1980's. In 1985, after only twelve months of project activity, the CRDP was all but immobilized due to "lack of GOB progress in eradication". At the same time, natural disasters were assailing the area; CRDP funding was insufficient to compete with the coca industry; and project gains were quickly overshadowed by the violence of the UMOPAR interdiction forces. The project's agricultural research and extension branch, IBTA, managed to do some work, but the rest of the project nearly stood still. In November 1987, the project was amended to include the Associated High Valleys (AHV's) in its strategy, effectively shifting project emphasis from the Chapare to its southern districts, or distrito sur. Although officially approved, Amendment 7 was opposed by key functionaries in La Paz of both the Bolivian and the U.S. Governments. Together they sabotaged the project, removing PDAR, the Bolivian agency responsible for funds from the newly-arrived AHV Advisory Team. The GOB, meanwhile, managed to reclaim control over the Chapare, so that research and extension work could proceed in most of that area. Late in 1988 the project was further amended, restoring some of its original focus on the Chapare. PDAR was restaffed, and work proceeded in both geographic areas. The evaluation team found that the Chapare project does have some serious problems in its design. For example, although the project's success will depend on the economic viability of alternative crops adopted by farmers, there have been no marketing studies of the markets for the proposed crop substitutes. There has never been a project agricultural economist working on marketing issues. Similarly, there is no sound economic basis for the credit allocations, in part because of the lack of a credit and marketing database and in part because credit is granted on coca eradication criteria, not economic criteria. Additionally, there is a contradiction between the coca interdiction effort and agricultural development project goals: new roads, for example, which are essential to the marketing of alternative crops in the Chapare have not been constructed for fear of aiding narcotics traffickers; lime, essential for soil preparation, is banned because it can be used in coca processing. Although in bureaucratic terms the project is more than five years old, due to start-up problems CRDP actually began implementation in earnest one year ago (September 1990). In the short time the project has been implemented, it has achieved some notable outputs. IBTA/Chapare, for example, has conducted some excellent research and followed up with extension to farmers to the extent possible under extremely difficult working conditions. Coca producers in the Chapare have responded to the project's "carrot and stick" approach. of September 1990 is already above the yearly target (5,000 hectares) and may, in fact, be double that figure. This development has been paralleled by an upswing in farmer interest in IBTA/Chapare's alternative crops technology. With coca leaf at $U.S. 80 per hundredweight, and given the correctness of prices quoted in the IBTA/Chapare study on alternative production systems, it appears that pineapple, coconuts, banana, coffee, black pepper, and palm heart all compete successfully with coca, while a small dairy system is about equal. Some of those systems are suitable in one micro-region and not in another, but the productivity potential of coca is likewise variable. Project activities in the AHV's at this stage are concentrated on upgrading roads and irrigation works. Some applied research/extension on irrigated crops is being carried out by NGO's with support from PDAR and USAID. Baseline studies of the various natural resources in the High Valleys are required before a program for sustainable agriculture and forestry production can be designed. Except for a soil survey now underway, there is no evidence of significant work in that direction. The evaluation team recommends that key project evaluation criteria should be economic. The current focus on coca eradication should be reduced. In the long term, farmers will shift away from coca production only if it is in their economic interest to do so, and the project will be sustainable only if farmers profit from project activities. (Author abstract)