Honduras - Developing Community Approaches to Economic Development
Food for the Poor
Honduras is one of the poorest countries in Latin America, with two-thirds of the population living in poverty. Suffering from high levels of gang violence, narco-trafficking, corruption, and pervasive underemployment, millions of Hondurans seek opportunities elsewhere. In 2017, over 1900 people fled their homes because of gang-related threats of violence, and 88% of the population believes their country is unsafe.
Nestled into a hillside outside the lush, mountainous region of Santa Barbara, the community of Bosques de Santa Lucia (BSL) is home to 57 families living in extreme poverty. This community, constructed by our international NGO partners Food For The Poor (FFP) and CEPUDO, is in the process of growing to provide 200 homes to impoverished and vulnerable families within the next few years. BSL is one of several ongoing FFP and CEPUDO projects dedicated to providing food, housing, infrastructure, and emergency relief to those in need.
What was the problem?
Our partners’ objectives in forming the BSL community were to provide basic facilities to impoverished Hondurans and provide the foundation needed for them to become economically self-sufficient. We quickly learned that this was no simple task, as Bosques de Santa Lucia is isolated, land constrained, and lacking in economic opportunity. The community is primarily inhabited by older couples and single women with multiple children, almost all of whom are uneducated, underemployed, and living on only $1.07 per person per day. Most families rely on minimal income obtained through temporary labor jobs in the surrounding area or by selling hand-woven hammocks, palm frond baskets, and other goods in makeshift stands along the side of a dangerous highway. Not only is the sales channel unsafe, but material suppliers are unreliable, demand for the products is sparse, and a lack of financial literacy results in a net loss on each product. The low income gained makes transportation inaccessible, restricting access to larger markets and job opportunities and even preventing children from being able to attend school.
Through our research and time in-country, it became clear that the people of Bosques de Santa Lucia were trapped in the poverty of their current situation with few opportunities to escape. But they were also hopeful, anxious to contribute, and desperately wanted a better future for their children. If the people could earn sufficient and consistent wages, they could not only afford daily necessities but could also enable their kids to go to school and dramatically increase the quality of life for themselves and future generations. Our goal was therefore straightforward yet ambitious: to identify sustainable employment opportunities for the 200 families of Bosques de Santa Lucia to raise them to a minimum sustainable income of $3.30 per person per day - a total wage gap to fill of one million dollars.
What did we do?
We began this journey focused on creating a new income-generating opportunity or local, sustainable business while optimizing the supply chain for the local handicraft industry. Through weekly partner calls and initial research, we learned extensively about the community, Honduran culture, and other projects that our partners had successfully executed. We discovered that there was not a single solution or business that could provide opportunities for every member of the community. Instead, we needed to design a portfolio of businesses that could provide sufficient income for the whole community.
Our team brainstormed and explored numerous hypotheses to fill the one million dollar income gap. We researched agricultural endeavors such as aquaponics and chicken-farming, manufacturing options like garment sewing or carpet weaving, and food service options to provide for the visitors of a nearby prison. Our partners even helped us to run a pilot sale of horchata (a local rice-based beverage) with the residents around the community, giving us further insight into workers’ capabilities, local demand, and willingness to pay.
By the time we arrived in Honduras, we had generated several ideas and made progress toward our million-dollar goal, but were still about $500,000 away from “filling the gap”. We needed to challenge our assumptions and personally engage with the BSL community if we were ever going to be successful. While in-country, we explored the homes, shops, businesses, and markets around BSL as well as other communities built by our partners. We had enlightening meetings with school teachers, community leaders, prison officials and even the mayor of the region to better understand the strengths and challenges of BSL from their perspectives. But we found we learned the most while spending time ideating with BSL community members.
Through “design-thinking” style focus groups and personal interviews with community members, we built relationships that helped us gain a deeper insight into their needs, hopes, and dreams. We were struck by their desires to bring work into the community in which all residents could participate, including parents, young people, and those with limited education or skills.
The community’s contributions helped us develop ideas that would satisfy the people and give them a sense of purpose. One interview revealed that the people of Bosques de Santa Lucia eat two small loaves of bread each day. With this behavior in mind, we investigated the creation of a community-run bakery, which became one of our most profitable and highest-employing project recommendations.
What was the turning point?
Through our exploration, we began realizing that a few hypotheses just weren’t working. Mainly, we were trying our best to make hammock sales optimization part of our solution as it was such a large part of BSL residents’ livelihoods. However, after extensive interviews and supply chain analysis, the team realized that there was no worthwhile way to make the hammocks and handicrafts profitable. We needed new opportunities to replace this common workstream in a meaningful way.
After running our focus groups with the community, our approach changed. We discovered what types of businesses they wanted. Our team then visited Choloma, a more established community operated by our partners, and found several successful businesses running collaboratively by residents. Choloma was operating without handicrafts, creating an entrepreneurial and cooperative spirit in the community. This was the inspiration we needed to find new paths for the people of BSL and close the gap.
What was the recommendation?
With the addition of several new hypotheses, our BOTFL team identified a portfolio of fourteen projects that could successfully create a living wage for all families in the community. The recommendation includes a diverse array of businesses, providing employment opportunities for people regardless of their existing skills and preferences. In addition, our proposal includes recommendations for community governance, leadership, and shared funds so that Bosques de Santa Lucia can grow, improve, and provide for all citizens even if they are unable to work. All of the businesses would be owned by a community cooperative which ensures continued guidance by the partners, strong management, transparency, and equitable distribution of benefit. Additionally, the diversification of business types increases the community’s resilience against an economic shock or natural disaster.