Honduras - a fair exchange
Digna López Espinal was one of 300,000 farmers who lost their crops in the recent flooding in Honduras, and yet she is optimistic for the future. Although she lost half of the crops due for harvest, as a member of COMAL (The Alternative Community Marketing Network), Espinal is getting help to plant for the next season. It is part of COMAL's purpose to improve farmers' livelihoods.
From small beginnings COMAL has grown into a network of more than 40 smallscale farmers' organisations and the Espinal family is just one of 16,000 families who benefit. As well as helping flood-affected farmers replant, COMAL purchases their produce at a guaranteed price and sells it through a network of over 200 community stores across Honduras. It also helps to develop and market the produce, offers credit and loans to farmers, and has even created its own community-based currency.
While the network of community stores purchase and sell these goods, they also offer a lifeline for many. In some COMAL communities the most vulnerable farming families are supported by a social fund financed with money from the community shop.
Credit where it's due
COMAL's community currency - Solidarity Exchange Units (UDIS) - are designed to ensure that money circulates locally, preventing profit and investment being lost to outside markets. UDIS have the same value as national currency (Lempira) and are used as a form of payment within the community shops. The shops then use it to source products from COMAL, which pays farmers partly in UDIS, which can be used to purchase goods in the community shops. Using UDIS within the network enables COMAL to use Lempira to source goods from outside the network, and to buy in bulk at lower cost.
UDIS are also used by COMAL when providing farmers with loans to access agricultural inputs and equipment. "We pay 20 per cent interest on a Lempira loan, whereas a UDIS loan is just 15 per cent," says Martinez. "This is much better than the banks, which charge 30 or 40 per cent." The UDIS loan is cheaper because it can only be spent in COMAL's community stores. This guarantees regular customers for the stores and benefits the farmers who supply them. Farmers pay back their loans with UDIS, Lempira, or by selling their produce to COMAL. The benefit of repaying debts in produce is that their goods can then be sold throughout the network of community shops, guaranteeing a market for farmers after they have invested in production, even if the price of their crops crashes.
The purpose of COMAL, according to Trinidad Sánchez, its director, is to build what he calls "economic solidarity". "COMAL was born out of the idea that we, the poor, can do business and include the practices of moral principles and values," he says. "There is no justice if there isn't food for everyone."
One member organisation in Honduras, COMUCAP (The Coordinator of Rural Women in La Paz), provided a group with training and loans in response to Hurricane Mitch, which devastated crops in 1998. The shampoo and soap they now produce from Aloe vera has enabled them to gain access to lucrative markets in Switzerland and Germany. Group member, Maria Garcia describes how her life has changed: "Before this project we just managed to eat to survive. Now we have more. Our house is made of wood and stone. We see our children will have a better life than we had."
COMAL is also working with similar organisations in Nicaragua, El Salvador and Guatemala, helping to develop a Central America-wide network. Sarah Smith-Pearse, communications officer at CAFOD (Catholic Agency for Overseas Development), which supports COMAL, praises the organisation's progressive attitude: "COMAL gives voice and power to those who are usually at the margins, and stands as a beacon of what is possible when people work together."
Date published: January 2009
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