Alternative Development

In the San Martin region, 30,000 hectares of cacao have
been planted replacing illicit crops.

The AD program employs an integrated development approach that incorporates economic and social activities.  Communities are offered the opportunity to sign “no replanting agreements” in which they commit to remaining coca-free, while USAID and the GOP commit to support them with a package of assistance tailored to each community’s priorities and needs.  This assistance includes planting new crops; increasing the productivity of existing cacao, coffee, and oil palm trees; increasing farmers’ access to financial services; strengthening producer associations and cooperatives to facilitate access to local and international markets; providing social infrastructure; and partnering with community members to support their own initiatives towards development.  As part of this effort, women’s well-being, gender equity, and youth are prioritized.

This bridge in Uchiza, San Martin, was built by USAID to support the
surrounding communities’ transition to a licit lifestyle.  Project infrastructure
is now helping previously isolated communities to connect markets.

Since 2002, alternative development results include:

• Program benefits expand:  More than 62,000 families received assistance with licit crops, such as cacao, coffee, cotton, corn, palm oil, and hearts of palm, on more than 90,000 hectares of land.  The program completed 670 infrastructure projects, including 177 schools, 102 potable water systems, 15 health clinics, 139 community multi-purpose buildings, 44 bridges, and 89 rehabilitated rural roads.

• Sales grow: Local producer associations gained strength as membership increased with the expanded area of licit crops and as producers received customized technical assistance on business administration and marketing strategies.  As a result, in 2011, total sales of the licit crops supported by the program were $34.0 million, generating 16,000 equivalent full-time jobs.

• Credit reaches the poor: Through alliances with private banking institutions, new credit products have been designed that link credit-worthy alternative development farmers to formal financial institutions for the first time.  In 2010 an agreement was signed with five new private banking institutions totaling $15 million in benefit of AD producers and their families.  Since the program’s inception, 5,100 families have accessed credit amounting to $10 million to invest in their businesses.

• Governance expands:  More than 42 municipalities have been strengthened through training programs, management improvement, and technical assistance.  Improved local government benefits citizens in these remote, rural areas.

• Social capital: Success in the AD program is made possible by an integrated development approach that incorporates economic development, social services, and governance.  Perhaps the most visible and far-reaching social capital activity is the “Winners of the Jungle” contest implemented by a leading Peruvian organization that promotes entrepreneurship.  In 2010 and 2011, over 650 communities participated in business training to develop over 700 new enterprise concepts.  The AD program also empowered youth to act as agents for advancement within their families and in their communities.

• Important outcomes: Further evidence indicating the success of AD programming includes the continual increase in licit incomes of participant families, which jumped by 24 percent from 2009 to 2010.  Poverty levels of direct beneficiaries decreased by 25 percent, from 65.7 percent in 2008 to 49 percent in 2010.  Most importantly, the commitment to leading a coca-free life has firmly taken root across a broad cross-section of society in AD regions, as more than 70 percent of direct beneficiaries assert that coca should be eliminated. 

Pictured in the above photo in Shambillo, Ucayali department, pineapple
is another crop being adopted in ex-coca growing communities with USAID assistance.

To consolidate the gains achieved in the San Martin Region, USAID will emphasize alliances with the private sector and transfer AD activities to regional and local governments, farmer associations, and other local actors.  Meanwhile, the program will redeploy resources to newly eradicated areas in other regions.  This model is now being implemented in Ucayali, where several dozen communities to date have signed coca non-replanting agreements, incorporating approximately 1,000 new families and thousands of new hectares of cacao and oil palm into the program.  Greater priority will be given to marginalized populations, including women and girls, persons with disabilities, at-risk youth, and indigenous groups, enhancing their ability to participate more fully as actors in their own development.

Partners: National Commission for Development and Life without Drugs (DEVIDA), United Nations (UN), Regional Governments of San Martin and Ucayali, local governments and financial institutions (Caja Nuestra Gente, Caja Maynas, Caja Luren, EDPYME Proempresa, Edyficar, Cooperativa de Ahorro y Crédito Tocache).

Implementing Partners: Consultandes, CEDRO, Chemonics International, Technoserve, and ACDI/VOCA.