Guanchias Limitada : a case study of an agrarian reform cooperative and its long-term relationship with a multinational firm in Honduras

This study traces the development of Guanchias and of its collaboration with Standard. Guanchias" origins lie in the failure of Honduras" agrarian reform movement to adequately address the problems of landless peasants; the promise of financial security through a guaranteed market for its bananas led the co-op - which had barely survived its first 3 years - to seek participation in Standard"s independent growers program. Over the next 15 years, benefiting from exposure to Standard"s work ethic and technical and business procedures, Guanchias members learned how to become efficient managers and laborers, how to bargain as an equal with their more sophisticated partner, and how to reinvest capital earnings in productive and socially beneficial member services - potable water, sanitation, housing, health care, and education. Standard, for its part, received an assured supply of bananas at relatively low cost and low risk in an uncertain environment and enhanced its public image through its involvement with independent growers. The Guanchias-Standard partnership has been criticized as a one-sided relationship in which a paternalistic benefactor takes advantage of contracted labor, but in fact the joint venture has served both parties well and has also been good for economic, human, and institutional development in Honduras. Although it is unclear as to how the relationship will evolve in the future, its strength was great enough to override a challenge to the contract in the early 1980"s. Moreover, Guanchias" continued reliance on Standard for materials transfers, extensive credit, and technical assistance suggests mutual acceptance of their interdependency. Implications of the Guanchias-Standard collaboration for Guanchias, the Government of Honduras, and development planners and donors are offered in conclusion.