This is an archived USAID document retained on this web site as a matter of public record.

Central America Drought:
Update #5

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U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT
FACT SHEET

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WASHINGTON, DC 20523
PRESS OFFICE
http://www.usaid.gov
(202) 712-4320

2001-103

FOR IMMEDIATE RELEASE
October 30, 2001

Contact: USAID Press Office

Central America is an area prone to natural disasters, as evidenced in recent years by such devastating calamities as Hurricane Mitch and the earthquakes in El Salvador. In addition, nearly two years of unrelenting dry conditions affecting Honduras, Nicaragua, El Salvador, and Guatemala have reduced domestic food production, spurring an increase in internal and external migrations. Economic conditions have worsened at the same time, with low international coffee prices putting coffee farmers out of work and eliminating employment opportunities for many small farmers and landless poor. Evidence from Guatemala indicates that levels of under-nutrition among children under five - already among the highest in the Western Hemisphere - are increasing. Decreased tax revenues resulting from the decline in coffee prices, and the general economic deceleration, which is linked to the economic slowdown in the United States, have limited the ability of national and local governments to respond to these problems.

Summary of US Government Assistance

As a response to these development and relief problems, during 2001, Honduras, Nicaragua, El Salvador, and Guatemala will receive nearly $90 million in food assistance from USAID and the US Department of Agriculture (USDA). This amount includes $5.6 million in emergency food assistance to help the four nations cope with the effects of the drought, $5.3 million diverted from non-emergency food programs for that purpose, and $1.1 million in non-food disaster relief aid. Some food from both the regular and the emergency programs will also go to poor rural families that are suffering from the drop in coffee prices. Total U.S. government (USG) emergency drought assistance, which includes food aid, agricultural inputs, nutritional supplements, and construction tools, now totals nearly $12 million for the region (See table below). In addition to the emergency effort, USAID provided these four countries with over $168 million in reconstruction and regular development assistance in 2001. Approximately $28.7 million in Title II non-emergency development resources are currently programmed for Nicaragua, Honduras, and Guatemala in 2002.

USG DROUGHT EMERGENCY ASSISTANCE

USG Disaster Assistance, Diversions From Non-emergency Food Program, and Emergency Food Assistance, as of 10/26/01

Country	USG [OFDA,USDA] Disaster Assistance	USG Diverted from Non-emergency Food Program	USG Drought Emergency Food Assistance	Total USG Drought Emergency Assistance	Food (MT)
Honduras	$175,000	$668,753	$1,506,100	$2,349,853	6,504 MT
Nicaragua	$875,000	$4,332,000	$3,032,700	$8,239,700	18,031 MT
El Salvador			$583,600	$583,600	1,290 MT
Guatemala	$25,000	$270,000	$520,200	$815,200	1,441 MT
TOTAL	$1,075,000	$5,270,753	$5,642,600	$11,988,353	27,536 MT

Food Insecurity

Many families in El Salvador, Guatemala, Honduras, and Nicaragua are chronically food insecure, and for this reason targeted, non-emergency food assistance programs in the latter three countries are a regular part of the USAID development effort. However, severe drought during the first crop cycle exacerbated this condition and caused severe transitory food insecurity in the region, starting in August. Although the rains did resume for the second crop cycle in many places, it is too early to generalize or to project crop yields in this cycle. If the second harvest in November through January is also below normal, additional food resources will be required for a longer period. In addition, more food aid will likely be needed to help poor households cope with the immediate effects of continuing low coffee prices. While the coffee problem is clearly not a short-term crisis, many families have lost a major source of income as a result and could go hungry unless steps are taken to help them in the short as well as the longer term. Chronically malnourished children under five years of age are especially vulnerable to reductions in an already precarious household food supply, and their nutritional status can deteriorate quite rapidly. During the upcoming critical period for assessing the food security, nutritional, and other social and economic aspects of the problem, USAID's Office of U.S. Foreign Disaster Assistance (OFDA) will provide a regional expert to assist the missions and advise on the situation. The table below provides estimates by USAID Missions of the number of people requiring short-term emergency food aid in the region. Assessments of longer-term needs are in progress and where available, are reported in the individual country reports below.

* Minimum 100,000 families with estimated 5 persons per family at risk from effects of chronic and acute malnutrition, drought, coffee crisis, and economic slowdown over coming year. See country narrative.

Country	Number of People Requiring Short-Term Emergency Food Assistance
Honduras	300,000
Nicaragua	303,000
El Salvador	50,000
Guatemala	500,000*
Total	1,153,000

Coffee Crisis

Low coffee prices have had a devastating effect on the coffee-producing areas of the region, many of them also affected by the drought. [The map below indicates where coffee producing areas and drought areas intersect.] Coffee prices hit a new low of 40.5 cents per pound in the last week of September. The cost to produce coffee now exceeds the selling price in most places, making it uneconomical to harvest and putting many farmers who borrowed against their crops out of business. This aggravates the short-term problem of household food availability, since the lost wages from significantly reduced coffee season employment were likely to have been used to buy food for the family. As experts predict that prices will continue to be low for the next few years, this situation requires both interim support measures and longer-term change in household income and food strategies in coffee producing areas.

Because of the importance of coffee in the economies of all Central American nations, the impact on poor, rural families has been enormous. In Honduras, early survey results indicate that up to 40 percent of local coffee producers will not harvest this year's crops, causing layoffs of an estimated 50,000 permanent employees and leaving over 150,000 temporary seasonal pickers without employment. Therefore about 200,000 coffee workers and their families will experience food insecurity this year and next. In El Salvador, according to preliminary estimates, losses of coffee sector jobs combined with those resulting from the drought may approach 65,000 this year. In Guatemala, ANACAFE (The National Coffee Association) now estimates that only 50 percent of the estimated 500-600,000 rural coffee workers will find work on coffee farms and those that do will see their earnings halved this year. It warns that this situation may worsen in November if many farmers elect not to pick their coffee because of low prices. Nicaragua has some 200,000 employed in the coffee sector. In the two largest producing departments, as many as 24,000 permanent coffee workers, many of them landless, depend on coffee estates for livelihood, but will likely see earnings significantly reduced this year. USAID is financing an assessment of the coffee crisis and the ripple effects on the economy in Guatemala, El Salvador, Honduras, Nicaragua, and Costa Rica. The study begun a few days ago and the consultant will be spending six weeks in the affected countries.

USAID is working with local partners in the host governments, civil society, and non-governmental organizations (NGOs) to examine both immediate and longer-term ways of responding to this rural crisis. In the near term, the Agency is addressing hunger. The longer perspective is focused on broader challenges impeding growth in rural areas. The strategy emphasizes economic integration and trade, good governance, innovative uses of science and technology, and management of environmental and economic risks. It involves a mix of interventions including feeding and health/nutrition programs, works projects, income generation activities, education and retraining, crop diversification, and technical improvements in coffee production and marketing.

Internal and External Migration

Anecdotal reports from USAID Missions indicate that internal and external migration has been increasing over the past few months. Although seasonal migrations are common during the coffee harvesting seasons in Costa Rica, reports by the Costa Rican presidential spokesperson indicate that increased numbers of legal and illegal Nicaraguan immigrants have entered Costa Rica this year in search of work and food. While El Salvador has not yet seen evidence of significant movement, Honduras and Guatemala report anecdotal examples of migrations of male labor force out of rural areas. Movement within countries to urban areas seems to be increasing, and there are indications that emigration to wealthier countries is on the rise. A September 23 article in the Washington Post reports that while the number of illegal entrants apprehended in the Tucson border area with Mexico declined by 26 percent last year, at the same time, the number of non-Mexican detentions grew by 42 percent. Most of the non-Mexican migrants are from Central America.

USG Emergency Food Strategy

USAID's Hurricane Mitch reconstruction and food assistance programs constituted an effective early warning system for the Central American drought. Since July, USAID has collaborated actively with US private voluntary organizations (PVOs) responsible for distributing PL480 Title II development food aid - Adventist Development Relief Agency (ADRA), CARE, Catholic Relief Services (CRS), Project Concern International (PCI), Save the Children, and SHARE - to transfer in-country P.L. 480 Title II commodities to drought emergency zones. Most emergency food aid is being distributed through food-for-work projects aimed at improving long-term food security and rehabilitating community infrastructure or through targeted feeding programs to malnourished children under the age of five. In addition to emergency and non-emergency food aid, the USG is supporting programs that also provide seeds and other agricultural inputs to farmers for the second planting season in August and September in these affected regions.

The World Food Program (WFP) emergency Central America Protracted Relief and Recovery Operation has requested 16,000 tons of food to address the drought in the region. In response, USAID's Office of Food for Peace has provided 4,800 metric tons of PL 480 Title II commodities to the WFP to assist drought-affected farmers and unemployed coffee plantation workers in Nicaragua, Honduras, El Salvador, and Guatemala. The estimated value of the food aid, including ocean freight, internal transport, storage, and handling is $2.1 million. USAID missions and their PVO partners in Central America are working in close cooperation with WFP, UNICEF, and local governments to coordinate all emergency operations.

The following presents an update on drought conditions in Honduras, Nicaragua, El Salvador, and Guatemala, and the USG response to these conditions.

HONDURAS

The Rural Crisis: Continued rainfall is needed over the next three weeks to ensure a good second harvest. Even with good rains, USAID anticipates that bean production from the second harvest will be below normal as only about 45 percent of the farmers who were hard hit by the drought received seeds. With the rural economy so dependent on coffee, it is no surprise that ripple effects have been felt in rural non-coffee enterprises. Local businesses report sales down 20-40 percent compared with last year. There will be little liquidity to pay coffee workers, and farmers may pay pickers in coffee. This will mean extreme subsistence living for workers and families who have relied on this source of income to supplement their crop production. USAID and PVO partner CARE are monitoring chronic malnutrition in children under five in Intibuca, La Paz, and southern Lempira, which are among the poorest areas of Honduras. So far the system has not reflected changes suggesting an increase in malnutrition. The area of the CARE program, while somewhat affected by the drought, was not one of the worst affected. Data collection for the 2001 National Epidemiology and Family Health Survey is completed, and analysis over the next month should enable USAID to see if there are any major changes in nutritional status. WFP is proposing a one-month series of rapid rural appraisals to determine future needs, which might also yield useful information.

USG Response: The USAID/Honduras drought working-group continues to monitor the situation. USAID approved CARE's transfer of 217 metric tons of Title II food from its regular program to the drought emergency, and WFP diverted over $600,000 of regular program food to the emergency. USAID also furnished WFP with an additional $1,506,100 for emergency relief commodities. OFDA provided $25,000 to purchase and distribute seeds and later granted an additional $150,000 for seed purchase and distribution through Zamorano Agricultural School. Over the course of FY 2002, USAID's PVO partners in Honduras will receive $3.6 million in non-emergency Title II commodities.

NICARAGUA

The Rural Crisis: After a month of good rains in September, precipitation in October has been much more sporadic. Very little or no rain was reported in the departments of Matagalpa, parts of Chinadega, Madriz, and Esteli from October 4 through 19. However, since that time, rains have resumed. WFP and USAID have just completed their joint crop assessment to estimate which geographic areas may require food assistance beyond December 2001. From this assessment, they will put together over the course of the next week a national crop monitoring map to show areas with a high potential for a good second harvest (green), those with significant stress but subject to recovery with adequate rain (yellow), and those that are already lost or with little potential for recovery (red). USAID is working with local NGOs and the government to monitor the yellow zones particularly, where crops are still at risk through the harvest period. Initial reports from the team suggest that, with the exception of a few pockets with serious crop losses, the rains have been adequate. Farmers expressed gratitude to USG for providing seeds and fertilizer on a timely basis, allowing them to take advantage of early rains. Corn, sorghum, and sesame will need approximately three more weeks of rain for ideal harvests.

USG Response: USAID is coordinating its efforts closely with the WFP. As an immediate USG response to the drought, up to $2 million of PL 480 Title II food stocks (8,000 MT) that arrived in Nicaragua at the end of July were distributed to drought victims beginning on August 2. For the medium term USG assistance, a total of $3,125,900 (13,613 MT) in 416b food commodities and $2,206,000 in Title II food (4,366 MT) began to arrive in Nicaragua in early October for immediate distribution. PVO activities already underway with Title II food will be extended and expanded to remote areas of Chinandega, Leon, Esteli, and Matagalpa departments. To meet emergency needs, OFDA provided a total of $475,000 for local purchase of foods, seeds, tools, and fertilizer for the second planting season. USAID and USDA made available an additional $432,000, also for tools and seeds for the second planting.

Beginning in January 2002, USAID intends to provide $10 million in food resources per year over five years under its non-emergency Title II development program, subject to the availability of funds. A first increment of 3,715 MT of food (out of a total of 6,375 MT for the year) will arrive in December 2001 and be distributed over the next five months. The program will monetize an additional 32,000 MT of wheat to cover transport, administration, and project input costs, such as tools and other supplies.

With minor exceptions, the USG remains the primary donor responding to the drought crisis in Nicaragua. The United Nations Food and Agriculture Organization (FAO) provided $300,000 for the purchase of seed and fertilizer, and the IDB provided approximately $300,000 from its Poverty Reduction Project.

EL SALVADOR

The Rural Crisis: El Salvador is no longer experiencing drought conditions. The Ministry of Agriculture announced on October 8, 2001, that the 2.4 million quintales of corn (1 quintal=100 lbs.) that were lost to the drought will be recuperated at the national level in the second season harvest (late October). This does not necessarily mean that the farmers most affected by the drought would have additional food. The WFP continues to report approximately 50,000 drought victims will require longer-term food assistance until next year's harvest. The WFP is planning another assessment of the need in early November.

The USG Response: An integrated host-country led program continues. It includes foodstuffs distributed via the WFP, a Food-for-Work program providing for economic infrastructure in the areas of rural roads, irrigation, and reservoirs, and a credit program implemented through the country's Banco de Fomento de Agropecuario. USAID contributed $583,600 of Title II commodities to this effort. A number of NGOs, including CARE, Catholic Relief Services, and the Lutheran World Federation have been working closely with the WFP to help get the food to the most needy.

GUATEMALA

The Rural Crisis: As noted in previous updates, drought conditions have severely affected Chiquimula Department, especially its two eastern municipalities of Camotán and Jocotán, which also rely heavily on seasonal migration to coffee and sugar areas to provide for family food needs. Other areas are now showing similar problems, with further reductions in household resources due to closure of some maquilas, low sugar prices, and a decline in income from remittances and tourism.

Based on more intensive field visits to examine malnutrition levels nationally, the Ambassador has extended her disaster declaration authority to include new areas suffering from acute child malnutrition. USAID has confirmed that the prevalence of wasting (acute malnutrition) among children is as much as three times higher than the national maternal child health survey of two years ago. The problem is concentrated in the poorer areas of the country such as El Quiche, Huehuetenango, Chiquimula, Chimaltenango, Baja Verapaz, and San Marcos whose large poor and indigenous populations rely on seasonal migration to coffee areas for income. More than half of the children in these areas were already stunted (chronic malnutrition) and thus susceptible to becoming wasted with reductions in household food consumption or other stresses such as diseases. The vast majority of these wasted children do not get to hospitals because of remote distances, lack of financial resources, and negative cultural attitudes about hospitals. The urgent challenge is to find where they are and treat them. For example, the doctors in Jocotán are going door-to-door to survey the status of children who are not getting to the centers, but this is costly, time-consuming, and difficult work.

The Government has proposed a strategy combining food assistance, health interventions, and income generating activities, but the breadth of the problem is beyond its capacity to address, so it is seeking international help. Based on two recent site visits to the most severely affected areas, the USAID Mission has determined that additional assistance will be required, including reprogramming of some existing non-emergency resources. Along with its Title II food aid partners and health NGOs, USAID identified the hardest-hit communities and is developing a strategy involving early warning, feeding and referral of acutely malnourished children, improved health care, and public works employment for drought victims. It estimates that 100,000 to 125,000 families are seriously at risk nationwide. An assessment team is in Guatemala to examine the situation and options for dealing with these immediate effects of reduced rural income.

USG Response: USG drought emergency assistance to Guatemala currently totals $815,200. OFDA is providing $25,000 for health personnel training, water treatment, and micronutrient supplements for drought-affected people, especially acutely malnourished children in the Camotán and Jocotán municipalities in Chiquimula. USAID also authorized Catholic Relief Services to use PL480 Title II commodities, valued at $270,000, to provide emergency rations in Zacapa and Chiquimula. In addition, the USG approved a food aid donation valued at $520,200 to the WFP for use in Guatemala. In collaboration with its partners, USAID is examining the hardest hit communities to develop a strategy involving food aid, health care, and cash employment for the families most at-risk in the rural crisis.

Over the course of FY 2002, USAID will furnish its PVO partners $15.1 million in PL480 Title II commodities for non-emergency development programs.

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