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Another way is possible: fair trade, cooperation and solidarity

Current events and discussion on the crisis in the Eurozone and more globally, have raised interesting questions of democratic deficit, sovereignty over economic policy and whether countries can work co-operatuively together to improve economic and social development. Yet in Latin America, the Bolivarian Alliance for the Peoples of our America (ALBA) agreement between progressive governments is showing a positive alternative, that puts people first. This blog explores how ALBA is helping the people of Nicaragua in areas such as health and education – one of the key reasons behind the Sandanista’s recent election victory there.

There will be a session on ALBA and one on Nicaragua at the Latin America 2011 Conference on December 3 at Congress House. The conference will  be addressed by speakers from Nicaragua, Venezuela, Cuba, Colombia and Brazil amongst others, plus MP Jeremy Corbyn. Register online and see the full programme here

As the Eurozone plunges into meltdown and the governor of the Bank of England predicts the worst crisis in the UK since the depression, innovative ideas based on solidarity between countries are being successfully put into practice in the Latin America through the Bolivarian Alliance for the Peoples of our America (ALBA). Trade is being turned into a tool to combat poverty, rather than one for the enrichment of powerful countries at the expense of poorer ones.

Nick Hoskyns from London has worked with rural cooperatives in Nicaragua since 1997 and is now quality manager for ALBANISA, an ALBA food social enterprise. He talks to David McKnight from the Wales Nicaragua Solidarity Campaign about the role of ALBA in enabling Nicaragua to implement infrastructure and social programmes that have contributed to a significant reduction in poverty.

Can you explain what ALBA is?

ALBA is made up of Antigua and Barbuda, Bolivia, Cuba, Dominica, Ecuador, Nicaragua, Saint Vincent and the Grenadines, and Venezuela. It was set up to counteract the free trade agreements promoted by the Western world; in Latin America it was ALCA (the Free Trade Area of the Americas). ALBA is everything that ALCA was not: all about the poor, solidarity, Latin American peoples coming together to resolve their problems. ALBA means ‘daybreak’, and hope. In Nicaragua, that has always had people against it, it’s always been a struggle. Within ALBA you have countries willing to understand revolution and in a very practical sense willing to support and help you.

How does ALBA differ from the European Union for instance?

When ALBA countries get together it’s not a negotiation of who gets most and gives least – it’s how they can help each other. ALBA is a space for innovation, putting ideas into practice for the poor and the disadvantaged. When I listen to the debates around the bailouts of the banks in the EU, it’s all about money; ALBA works within a framework which talks about social development.

How does the fair trade agreement [between Nicaragua] and Venezuela work?

Venezuela sells oil to Nicaragua [at] the market price, but 50% of the value is a 25-year loan at 2% interest. Nicaragua invests this money in infrastructural projects and long-term development. The 50% that Nicaragua has to pay in 90 day is paid in  cash or in the export of meat and livestock, coffee, beans, milk, cooking oil and sugar to Venezuela. The priority is given to the small farmers organised into cooperatives. The principle is a fair price for both  farmers and consumers.

In 2008 Nicaraguan exports to Venezuela totalled US$27 million. We are heading for way over US$350 million in 2011. Venezuela has now become the second most important destination for Nicaraguan exports. The first of course is the US. The importance of the US to the Nicaraguan economy can’t be minimised but this is a very different trading agreement.

What are the benefits of ALBA for Nicaragua?

There was Miracle Operation, where Nicaraguans who had eye problems  have had  free operations. People who thought they were never going to have full vision again have had their sight restored. Then there’s the solidarity bonus, where employees who earn less than C$5000 (£150) get a bonus  worth C$700 a month, this is particularly important for low paid women workers.

It is an integrated approach coming from many different angles. Poverty has gone down 7%. Exports are growing at around 30% a year. The economy is growing at 4% while the West is stagnating. So ALBA is working for people directly and also working for the economy as a whole – for big businesses, for small businesses and for individual families.

What does Nicaragua contribute to ALBA?

Nicaragua provides a great ally within Central America that speaks out on international issues in favour of the ALBA countries. Nicaragua is out there at the UN an independent opinion from any lobbying from Western countries.

I’ve been privileged to have been involved in an interchange between the Cuban and Nicaraguan cooperative movements; Cuba is looking at the cooperatives in Nicaragua as a model to develop their economy. I believe that in the future, Nicaragua is going to provide a  model for the other ALBA countries of how to work in a way that is inclusive, incorporating large companies without compromising commitments to the small farmers.

What’s the future for ALBA?

The thing to understand about ALBA is that it’s about doing and it’s about achieving. For example in Nicaragua it was decided to invest in energy so there were no more power cuts. They decided that all disadvantaged children should get at least one good meal a day- that’s happening.

ALBA is a group of countries that are there to develop and to make a difference for the poor and disadvantaged. And, in Nicaragua, it’s successful. This is real and it’s working.

Further information: Nicaragua Solidarity Campaign


  1. Jon Danzig says:

    Readers may also be interested that many years before Fairtrade existed, we imported almost 3 tonnes of instant coffee from Tanzania to the UK to help support manufacturing in the Third World. Last week BBC radio interviewed me about our ‘Campaign Coffee’, that helped to start the idea of ethically sourced coffee in Great Britain. The broadcast is now available on YouTube (4 minutes):

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