Community Development Fund: Report on First and Second Loan

Holly Yasui
Monday, January 1, 2007

The Center for Global Justice has made a $100,000 peso one-year loan from its Community Development Fund to a network of cooperatives called the Empresa Integradora para el Desarrollo Rural (Integrated Enterprise for Rural Development) del Valle del Mezquital in the state of Hidalgo. The Integradora coordinates the activities of twelve small cooperatives that cultivate agricultural products.

This is the second loan that has been made to this organization, which two of the Center founders, Betsy Bowman and Bob Stone, first visited in the fall of 2003. At that time, the Hidalgo group had one peach orchard, one cooperative cultivating mushrooms, and a young people’s group with hutches for the raising of rabbits, but no animals. In 2004, the mushroom cooperative decided to raise tomatoes, and by 2005 they had nine hothouses with drip irrigation systems, and six hothouses for the cultivation of nopal cactus. With the help of the first Center for Global Justice loan of $50,000 pesos in 2006, they built six more hothouses and hired consultants to write grant applications to various government agencies for additional resources and training. Future plans include increasing the number of crops produced per year in the hothouses, and the purchase of canning equipment in order to sell their products off-season as well as seasonally and to market them more widely.

before and after: hothouses

The idea behind the Community Development Fund is that even small amounts of low-interest credit, especially to cooperative enterprises, can help groups of people to attain self-sufficiency, and repayments of loans then become available to others. Of the 2% interest charged, 1% is retained by the Center for overhead costs and 1% returned to the borrower upon timely payment of the loan, for their internal savings. Because groups rather than individuals receive the loan, the benefits and responsibility are spread among many and, most importantly, this fosters independence from the traditional market model of production and consumption that hinders small-scale communal enterprises. Loaning to groups helps create and preserve sources of income within communities, thus easing the pressure for workers to emigrate, which is a severe problem in rural areas throughout Mexico.

For that reason, the Center’s Community Development Loan Fund accepts applications only from organized groups, preferably legally constituted as cooperatives or SPRs (Sociedad Productiva Rural) that are working toward self-sustaining productive projects that will provide work and income for its members. The members of the Loan Committee are Yolanda Millán, Octavio Bernal and Betsy Bowman.

The Community Development Fund also needs donations in order to be able to continue to seed and support productive projects. Contributions are tax deductible in the United States – and keep working year after year as the donated money is loaned, repaid, loaned again, repaid, loaned again, etc. This is a concrete way that concerned people can support local enterprises so that workers can stay at home and develop resources within their own communities instead of emigrating. For applications, or to make a contribution to the Community Development Fund, please contact the Center for Global Justice, or 150-0025

members of the Hidalgo cooperative