From Subsistence Farming to Prosperity: The Inspiring Story Of Ecuadorean Town With IFAD’s Support

Residents of Chiquicha, a remote town in Ecuador’s Tungurahua province, are currently seeing prosperity they hardly could have imagined before.

Four years ago, they were just gathering the first fruits of an irrigation project launched by the Buen Vivir programme. 

Ecuador is a middle-income country with an economy highly dependent on oil and export agriculture.

Almost one-quarter of the population in Ecuador lives in poverty, most of them in rural areas. The rural poverty rate, at 43 per cent in 2018, is almost triple the urban rate (15.9). The higher poverty rate is attributable to high unemployment and underemployment, low salaries, limited access to productive assets such as land, water, credit and technology, and deficient market linkages.

61% of rural women work in agriculture and livelihoods.

Since 1978, the International Fund for Agricultural Development (IFAD), an agency of the United Nations has invested a total of $151 million in 10 programmes and projects related to agricultural development in Ecuador, benefiting more than 291,767 households.

As a middle-income country, its economy is highly dependent on oil and export agriculture. In the last 10 years, Ecuador made a remarkable effort to fight poverty and inequality through increased social spending and important investments, with infrastructure, hospitals and schools having been impressively modernised.

But, the recent economic slowdown and the contraction of domestic demand is putting at risk these achievements, contributing to a rise in the overall poverty rate from 22.5 per cent to 24.8 per cent 2018. 

The country has a population of 16.5 million people. One-third of the population is concentrated in two metropolitan areas: Guayaquil and Quito, the capital. 

Rural population still accounts for 36.5% of the total. Social indicators also point to persistent inequality in both rural and urban areas. 

Shaping the country’s development model, modernising the productive sectors, and reducing dependence on imported goods and services is among the priorities of the government. To achieve this goal, rural smallholder producers will need to increase their productivity, efficiency and connectivity, by boosting technology use and accessing key rural services.

 In Ecuador, IFAD loans support the diversification of the rural economy by promoting cooperatives and investments to generate employment and income for poor rural families. Given its overall experience in the region, IFAD makes a tangible contribution towards supporting these efforts through investments in rural areas by combining innovation with action.

Key activities include:

Improving access to assets and resources to support the diversification of the Ecuadorian rural economy, promoting, among other measures, associative enterprises and investments that generate employment and income for poor rural families in Ecuador; and

Increasing the capacities of rural poor producers and potential entrepreneurs to engage in, and benefit from, pro-poor and inclusive productive policies.

Between September 2013 and April 2015, Buen Vivir, a joint effort by IFAD and Ecuador’s Ministry of Agriculture, invested $173,000 in Chiquicha to build water reservoirs and set up drip irrigation systems for 90 families. 

With contributions from beneficiaries and the municipality, the total investment amounted to almost $300,000 – quite an effort for the people of this small town at the foot of the majestic Tungurahua volcano.

Buen Vivir’s Local Director, Leonardo Gallegos, says “Chiquicha’s people really committed to the project. It was not easy at first. They had doubts, they feared being deceived. But when the project took off many beneficiaries kept on investing. The result is amazing.”

The irrigation system has revolutionised the way producers in Chiquicha work. 

Explaining, a prominent figure of the Local Action Group, Trajano Pasmiño, says “water is essential for agriculture, and since it doesn’t rain here between May and November, there is a local mechanism set up for coordinating the different groups that benefited from the project. Now we can water during those months because the reservoirs store water for up to six months.”

Adding, President of the La Pampa Producers’ Association, María Rosa Changopalín, says “now we can plant whenever we want, while before we had to wait for the rainy season.” She proudly showed IFAD visiting officials her thriving farm, which runs downhill on extremely steep terrain. Then, she pointed out a steep, rocky embankment on the other side of the valley. “Before, this land was like that hillside. There was nothing”, she said.

Secretary of the La Pampa Association, Franklin Morales, says “we have stable production now, because now we can harvest several times a year. In addition, we diversified. Before, we only planted tree tomatoes. Now we have blackberries, grapes, raspberries, strawberries, tobacco, corn, vegetables…”

He also showed the IFAD officials his strawberry field, a well-organised 400 m2 plot, and posed for a photo wearing an extraordinary smile. It was certainly no surprise why: his family’s income has gone from $390 to $700 from this field alone. The additional funds have allowed him to buy more land, and his family is now making $1,400 a month in total.

Overall, the beneficiary families’ monthly income has gone from an average of $529 before the investment to $979 just after the completion of the project – an increase of 85 per cent. That figure is even higher now.

The success of the project has sparked a kind of “positive jealousy” throughout the region. Rocío Morales’ family, for example, didn’t take part in Buen Vivir, but they decided to invest their savings in a similar drip irrigation system. 

The investment turned out so well that they bought more land. Today, their profit is around $1,000 a month – and that’s after the $1,200 a month that goes toward repaying their loan. In total, they’ve gone from earning about $500 to $2,200 a month.

Many other families have stories similar to Rocío’s. The original project saw the installation of drip irrigation systems on 9 ha of land. Now, almost 100 ha are irrigated. And the good news has travelled through the region. 

The neighbouring municipality of Rosario plans to replicate the project, thanks to an additional $10 million in funding received by Buen Vivir. Mayor Byron Cundalato is enthusiastic about the opportunity for 150 of his municipality’s families to achieve the prosperity he sees in Chiquicha.

And they’re eager to go further in Chiquicha, too. Víctor Morales explained that he is planning on improving the drip irrigation system with a humidity-sensing system for an even better use of water. “IFAD’s help was the first step. But we want to go beyond”, he said.

Apart from these individual initiatives, Buen Vivir staff is currently designing a second phase of the project that will complete the transition to organic farming by transforming crop residues, which are currently just being burned, into biomass. 

It will benefit around 1,000 families, who will have the opportunity to cut down their CO2 emissions and gain access to high-quality organic fertilizers. This, in turn, will qualify them to obtain an organic production certificate, which will allow them to enter more select markets and obtain a better price for their products.

When the IFAD Director for Latin America and the Caribbean, Rossana Polastri, who led her colleagues on the visit left Chiquicha, they felt proud. ‘’We have seen proof that investing in small farmers makes sense, and IFAD’s work was paying off. We thought back to Sergio Arcos, the Local Action Group’s current president, who had quoted Cicero to us: Agriculture is the most dignified occupation for a free man. We were inclined to agree’’, she said.

Some of the IFAD officials first visited the community on mission four years ago, and returned some months ago. Accompanying Rossana Polastri this time, pride and joy were all around.


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