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Chiapas al Día, No. NUMBER
CIEPAC
Chiapas, México
June 29, 1998

The Impact of the Chiapas Crisis on the Economy
Part 1

Thus far we have talked a lot about the indicators of the political and social crisis in Chiapas. Now we will look at the assessments of the regions and of the factors in the productive life in the state, mentioning only a sampling of some indicators such as coffee, corn, land, fishing, cattle, commerce, housing and natural catastrophes.

The number of cattle in the state has lowered by 50 percent; 90 percent of invaded lands have been emptied by public forces and the majority have been left unproductive; 70 percent or 80 percent of coffee has been destroyed by catastrophes and 70 percent of the 73 thousand products have been affected by a loss of more than 100 million dollars, estimated by others to be 160 million, (coffee contributes 40 percent at the national level). Production of corn, a principal crop, was reduced by 50 percent and registered a national loss of 2 million tons. Other agricultural products, such as beans, have been severely hit.

It is certain that since the beginning of the armed conflict between the EZLN and the federal government in 1994 up to today, the situation has worsened. Before the conflict, official statistics placed Chiapas in first place as the most marginalized area within the country. This was even confirmed by President Zedillo, businessmen, the Church and political parties. There is no sector that says otherwise. Nevertheless, differences can be found in the way each sector assesses the causes of the critical situation and the ways to resolve it.

We find three kinds of assessments that seek to explain the causes and roots of the crisis: 1) the lack of employment and of investment in the state, a thesis sustained by the federal and state governments, as well as one sector of the Chiapas business community; 2) the armed uprising of the EZLN which has dropped the state into misery from 1994 to the present, a thesis sustained by cattle ranchers, the PRI, the PAN and others; 3) the federal government’s non-compliance with the San Andres Accords, a thesis sustained by the EZLN, campesino and indigenous organizations, the PRD, some intellectuals, academics and NGOs.

Land

The land situation in Chiapas is serious and complex. According to official figures from the Prohousing Institute in Chiapas (Inprovich), there are 84 invasions of urban lands in the principal cities within the state. Nevertheless, the most serious situation is found in rural areas. According to official statistics, as a result of the armed conflict in 1994, 1,280 lands were invaded by campesinos and indigenous.

According to the Cattle Commission of the State Congress, the amount of land invaded equals 250,000 hectares. According to the officially allied organization the Revolutionary Workers Confederation of Mexico (CROM), the EZLN and other organizations in the Jungle and Highland zones have invaded 715 ranches, which has resulted in a major loss of production. According to Jorge Constantino Kanter, leader of the Doctor Belisario Dominguez Small Rural Landholders Association, one of the principal leaders of landholder interests, 700 plots of land have been taken in the conflict zone, for which only 400 landowners in Altamirano, Ocosingo and Las Margaritas have been compensated by the government. According to the secretary of Agrarian Development, in 1994 more than 60,000 hectares were invaded, while others say there are 80,000 hectares "laying fallow because of the EZLN". According to the assessment of interim governor Roberto Albores, in four years small rural landowners have lost 1,900 plots of land, 70 percent of which are lying fallow.

The range of hectares seized since 1994 oscillates between 60,000 and 250,000 hectares 1994, between 700 and 715 ranches seized in the conflict zone and between 1280 and 1900 lands seized.

According to the government, of all of the lands seized, 92 percent have already been taken back and the invaders removed, leaving only 103 lands (6,000 hectares) to take back as of May of this year, and they are in the hands of campesino organizations such as CIOAC, ORCAO and ARIC-Independent. According to the coordinator of the Chiapas Dialogue, Emilio Rabasa, what we call evictions are the result of "dialogue and agreements" with campesinos and their organizations. So far this year, lands have been emptied in Yajalon, Ocosingo, Venustiano Carranza, and Simojovel, among others, where Public Safety forces and the army have participated in the operatives.

Official statistics affirm that 50,000 families have benefited from the government’s turning over 180,000 hectares, which has signified an outlay of 600 million pesos. According to the secretary of Agrarian Development, in the entire history of Chiapas 4.2 million hectares have been given out.

There are many cases in which different campesinos possess titles to the same pieces of property that the government has given them, generating anger and division among the organizations that legally possess the land. More worrisome is the information given by the Chiapas Geography and Statistics Society (Segoch) in the sense that at least 123,000 hectares from other municipalities have been used by the government, who has turned them over to new owners from other municipalities, which duplicates the ownership of the same lands.

According to Segoch, in Chenalho, under the law of common assets peasants have received 27,914 hectares of land, while the surface of the municipality is only 13,090 hectares. In Chilon, the cooperatives of San Sebastian Bachajon, San Jeronimo Bachjon and San Jeronimo Tulija possess 57 percent of the entire surface area of the municipality, which is 249,000 hectares. In Sabanilla, made up of 17,140 hectares, owners possess 24,297 hectares in titles. In Tila, with 39,000 hectares, campesinos possess 62,436 hectares. And the same in Chalchihuitan, Oxchuc, Tenejapa and Zinacantan.

At the beginning of the year, CIOAC reported that it had demanded 14,000 hectares, and only 59 percent of those were given due to a lack of resources or because the owners didn't want to sell. The officially allied CNC requested 201,000 hectares and has already received 70 percent of those. Independent campesino organizations like OCEZ and OPEZ in the border region requested 18,000 hectares. Thus, the struggle for land continues to be central to indigenous and campesinos. This is far from the famous agrarian little farm that has been decreed often by the government of Chiapas.

Cattle

In Reforma, cattle activity has decreased because of oil extraction. The Cattle Association of Escuintla confirmed that cattle production has been deeply affected and that marketing dropped 30 to 40 percent because of drought in the land during these months, and the price of cattle dropped two pesos per kilogram. The National Cattle Confederation affirmed that between 40 and 60 head of cattle are stolen each month in the Coastal zone. El Barzon and the State Union of Farmers, Traders, Industries and Service Providers report that 600,000 cattle have died due to drought and a lack of food, and 20 million cattle are at risk throughout the country.

According to the local Cattle Association, Chiapas faces a 20 to 30 percent reduction in cattle if urgent measures are not taken, as there are already half price sales taking place because people are in a panic since the animals are dying. According to the Benito Juarez Union of Small Landowners, agriculture and cattle production from 1994 to the present in Las Canadas dropped 95 percent, primarily in Las Margaritas, Ocosingo and Altamirano, thus the economy of small landowners has stagnated. For example, in Ocosingo, 4,000 cattle a month used to be sold whereas now none are, and there is also a scarcity of corn and beans.

According to the CROM, 700,000 head of cattle have been lost due to the conflict.

According to the Secretariat of Agriculture and Cattle, in 1994 Chiapas had 3 million head of cattle and now there are only 1 million 600 thousand. Thus, rural landowners affirm that since 1994, more than 600 small landowners have emigrated to other states in search of better opportunities. In Ocosingo alone, 300 small landowners emigrated to Yucatan, from Altamirano more than 200 cattle ranchers emigrated (all of the small landowners), others have gone to Veracruz, Campeche and Oaxaca, and four large cattle ranchers from the state moved 1,500 cattle to Quintana Roo. In other cases, the cattle ranchers changed their capital holdings, investing in commerce.

Cattle ranchers in the Northern region say that more than 200,000 hectares that the federal government acquired for campesinos lie fallow, but they make no reference to the difficulties imposed by militarization and paramilitarization in the region.

Coffee

Migual Perez Ayala, president of the Administrative Council of the Rural Association of Collective Interests, Tierra de la Frontera S'tzak Lum, said that as a result of the drought of the last three months, more than 40 percent of the coffee production was affected in the Jungle zone. It is worth mentioning that the organization harvests 284,000 quintals of coffee in Teopisca, Tzimol, La Trinitaria, La Independencia, Las Margaritas and Comitan. The organization is comprised of five thousand members.

In Chilon, producers from the State Campesina Coalition of Productive Farmers (CECPA) denounced that because they did not get support from Coescafe (State Coffee Council) and Banrural, five thousand sacks of coffee for export were left in their warehouses. Also, 9,000 producers from 154 groups that grow on 30,000 hectares in the Tzeltal-Chol region have been hurt by this situation. On the other hand, in Chintalapa, 12,000 hectares of forests and coffee plantations were destroyed, affecting 800 families.

Other sources confirm that 27 million pesos are needed (approximately 3.5 million dollars) to rescue 16,000 hectares of damaged coffee lands in the rural zones of Tapachula, because of the drought. For its part, the PRD in Tapachula affirmed that at least 20,000 hectares of coffee have been damaged in the region so far, affecting 2,000 producers. The CNC affirms that this is the worst disaster in 30 years, that the loss of coffee in Tapachula is as high as 80 percent of the 2,300 hectares of land that are used to cultivate coffee.

The Secretariat of Agriculture, Cattle Ranching and Rural Development (Sagar) confirmed that 15,000 hectares of coffee were affected by the drought, primarily in Soconusco. The State Union of Coffee Producers affirmed that 30 percent of the coffee was planted in its flowering stage, which is why in the Soconusco region alone, 67 percent of the production will be lost in the present agricultural cycle, signifying a reduction of 878,000 quintals of a total of 1,680,000 in 30,000 hectares. In Cintalapa and Ocosingo, at least 3,500 hectares were damaged due to fires.

In response to the 10,000 hectares damaged in the Coastal region, 5,000 producers in the region requested that the Sagar declare it a disaster zone. As if that weren't enough, coffee production leader Adalberto Juarez, who was detained in January, 1997 for diverting 25 million dollars worth of resources (600,000 pesos) that the World Bank sent to Banrural for coffee growers, was let out of jail.

According to the Coordinating Body of Small Producers of Coffee (Coopcafe), coffee production in the conflict zone dropped by 50 percent and affected 60 percent of the members (of a total of 16,000 producers). In Los Alto, Norte and Ocosingo, 30 percent of the hectares have not been worked and they have no governmental support for supplies, stockpiling and marketing the products.

Similarly, militarization affected 10,000 displaced people in Chenalho, who did not harvest. Their production was stolen by paramilitary groups, police forces and the Mexican Army itself. They distrust the armed forces because of the February 3 assault on a cargo of 250 sacks of coffee weighing 79 kilos each, property of the Cooperative Union of San Fernando that was headed to Veracruz and Dinamarca. The military is suspected to have been involved in that assault.

The National Council of Coffee Producers calculates that 100 million dollars will be lost this year because of the inability to produce 60 percent of the coffee, which has been irreversibly damaged on the plantations. In the 96-97 harvest, there was a 50 percent deterioration, and they were unable to reach production levels of 1,200,000 quintals. This exposes the lie that in Chiapas 70,000 hectares are productive. In the countryside of Chiapas, 30 to 40 percent of its capacity is being worked, and there are at least 80,000 hectares that are damaged.

El Barzon and the State Union of Productive Farmers, Commerce, Industry and Service Providers affirm that of the 69,000 tons a year that are produced, for this particular production cycle only 40 percent was saved, and 100 percent of the crops were affected. According to the cooperative commission of Escuintla, 70% of coffee production was lost during this cycle. According to the CROM, 45,000 hectares of coffee have been affected and 35,000 direct and indirect jobs have been lost between 1995-96. Finally, official data from Sagar affirms that there are 18,000 hectares of coffee damaged, while some producers sustain that there are 80,000.

There are other indicators that there is a structural crisis in Chiapas with regards to coffee. The local press reports that the state government backed 5 million dollars in credit operations to campesino organizations for an original sum of 6 million dollars, and since that has not yet been paid, this initial debt has now grown to 40 million dollars, and governor Roberto Albores asked that the organizations cover their debt.

The credit that has not been covered and that was granted in 1985 by the US firm Questor Investment with the state government as the guarantor, could result in an embargo on assets, homes, and land in 21 Cooperative Unions, as well as the decommissioning of coffee in the border zone. This would affect buyers, as the company won all of its lawsuits in 1987. In October, 1996, Cuarto Poder warned of the diversion of resources allocated for supporting coffee growers when the debt was 14.8 million dollars. In the 95-96 agricultural cycle, Bancomext consigned productive credits for Chiapas worth 20.9 million dollars and has only recovered 4.5 million of those.

The general assessment of coffee harvesting, one of the primary crops in Chiapas, is extremely grave. The UEPC affirmed that 70% of the 73,000 producers have been affected, with a loss of more than 100 million dollars. Others say that loss could amount to 160 million dollars for Chiapas, as it contributes 40% of the nation's coffee. Similarly, they confirm that in Chiapas there are 243,000 hectares of coffee (others say 230,000 or 270,000), of which 80,000 have now been damaged.

According to the CNOC, before the droughts in Chiapas, there were 233,000 hectares of coffee. Nevertheless, 100,000 hectares have been infected by insects and illness, which resulted in a reduction from 1,300,000 quintals per productive cycle to 750,000 quintals of low quality. They also state that governmental support has only been given to the Otilio Montano y Socama organization, sympathizers of the official party, and credits for the coffee sector have been suspended by Banrural, Sedesol and Coescafe, with the aggravating factor that more than 10,000 hectares have been burned by fires this year.

Corn

This primary basic grain is also in a profound crisis. In February of this year, 1,200,000 tons were hoped for from 900,000 hectares that had been planted, according to the president of the State Union of Corn Producers (others hoped for 200,000 or 300,000 tons more). At that time they calculated a total loss if the rains didn't come in May or June, which is what occurred. According to the Union, in 1997 tons when 780,000 hectares were planted, 300,000 tons were lost and as a result, 900,000 toms of production.

According to the University of Chapingo, in Reforma, 60% of corn and bean production fell in comparison with production levels of the 70's, because of oil production. Pemex extracts 2,400,000 barrels per year. According to the Union of Corn Producers in the State, 40,000 producers of Frailesca were affected and they requested that the government free up support from Procampo to campesinos. Production dropped by 30% and producers hoped to increase production from 1,300 to 2,000 tons of corn.

Sagar reported that in 1998, they would have to import more than 13.4 million tons of basic grains (a third of national consumption), which signifies an expenditure of 2,300 million dollars. The agriculture losses in the entire country were about 3,000 million pesos, in spite of the fact that more than 4,000 million pesos in aid were allocated for the countryside. Imports increased by 13%, meaning about 2 million tons more than in 1997. A total of 406,000 hectares were left unsown (20% of what had been planned) due to a 40% reduction in rain - dams only functioned at 29% of their capacity and they continue to drop 2% per week. The federal government will subsidize 60% of the harvest prices.

Corn was the most affected product, with losses of 2 million tons, equal to 2,630 million pesos. In second place were beans, with 150,000 tons equaling 1,000 million pesos, and there is a national deficit of 5.5 million tons in the country.

In its assessment, CIOAC calculated that 5 million tons of corn were imported into the country in 1998, equal to the creation of between 250,000 and 300,000 permanent jobs for a six month period, and signifying an expense of 8,000 million pesos. According to the CNC, the use of agrochemicals has affected 90% of the land, reducing production. Corn production in Chiapas is 750,000 tons, and not 1,250,000 as has been stated publicly.

At the same time that the 5 million tons were imported into the country, the price of tortillas rose from 2.50 to 3.00 pesos. According to the State Coalition of Independent Organizations and Industries of Meal and Tortillas in Chiapas, with this new increase in the price of tortillas, the federal government will save 6,405,890 pesos when they no longer pay for corn.

Other farm products

In February it was estimated that the April and May cocoa harvests were lost in the Northern Zone (Pichucalco, Juarez, Ixtacomitan) due to bad weather, representing more than 1,000 hectares of cocoa from 300 producers. In light of this situation, exports were delayed until October when they hoped to obtain 100 tons. On the other hand, due to fires this year and the resulting destruction of the flora, as well as the smoke that invaded the state, honey production was seriously affected.

With regards to beans, in January of this year, Conasupo announced it would pay Chiapas the best price in the country for beans, at 5,000 pesos a ton, and it hoped to gather 2,800 tons in the autumn-winter cycle of 97-98 until April 30. Sagar hoped for 800,000 tons for 1998.

Nevertheless, by March, the State Marketing Council (a credit agency that works in 74 municipalities with farm projects, financed by INI and international organizations) reported that in the first three months, more than 35,000 hectares of grazing land and 20,000 of corn, chili and bean crops were affected by drought and lack of a budget. They also reported losses of 20,000 tons of corn in Ocosingo, Mazapa, Villaflores and Tonala. In Palenque, in 3,000 hectares they lost 20,000 tons of chili and 3,000 of beans, 12,000 of cocoa in Tila and Amatan, and 5,000 of oranges in Ixtacomitan.

On the other hand, cane growers in Acapetahua, Villa Comaltitlan, Tuzantan, Huehuetan, Huixtla and Mazatan requested infrastructure and irrigation systems from the government. Of the 9,000 hectares that have been cultivated, only 3% have irrigation systems and they are no in conditions to confront a crisis in the sector.

Poultry farming

Sagar reported that in 1990, Chiapas produced 18 million chickens. In 1994, this number reached 30 million and this led to self sufficiency. By 1997 there were 42 million, which meant there were 12 million to export to other states. This total equals an average of 850 million pesos, 6,000 direct jobs and 30,000 indirect jobs. Nevertheless, this year the price rose, reducing sales in the sector by 80%. According to Secofi, this improper increase by producers hurts family economies.

Fishing

In spite of the large coastal area in Chiapas, fish production is poor and insufficient compared to its potential. Combined with the existing level of poverty in this sector, residents of Paso Hondo along the border with Guatemala reported that 2,000 fish have died due to the poisoning of the El Jocote River that leads to the Grijalva River.

On the other hand, fishermen denounced contamination by banana plantations, oil factories, papaya processors and sugar plantations, due to the overuse of agrochemicals. Nevertheless, while the commercial fish marketing fleet in the state is small, in Playas de Catazaja, fish production seems to be increasing with the help of governmental projects.

Assessment

According to Jorge Constantino Kanter, the damage caused by the EZLN in the Chiapas countryside could not be recovered even in 20 years. According to transportation and construction sectors, economic development in Chiapas is stalled due to the conflict. The Confraternity of Protestant Churches (Confraternice) believe the problems in Chiapas primarily stem from injustice and marginalization, state and federal governmental neglect, and the permission to engage in expulsions and other crimes. Barzon and the State Union of Farm Producers, Marketers, Industry and Service Providers say the farming losses amount to more than 50,000 million dollars, which is why they are requesting that the Mexican countryside be declared to be in a state of emergency.

In March of this year, CIOAC predicted that farm production would fall to as low as 45% in Chiapas. According to businessmen, The GDP in Chiapas dropped 20% between 1993 and 1997. Ex-governor Julio Cesar Ruis Ferro states that 60% of the Economically Active Population in Chiapas is involved in farming, but this sector only contributes 14% to the state GDP.

In light of this panorama in the farming sector, we have seen various diagnoses from different sectors. Each diagnosis proposes a solution: 1) generate more investment and jobs, but how and where is this taking place? 2) put an end to the EZLN, apply the law, the hard line, put an end to autonomous municipalities, disarm the EZLN and if necessary, find an armed way out of the conflict; 3) enforce the San Andres Accords by accepting the Cocopa’s proposed legislation that is at the Democracy and Justice Table, and thus renew the dialogue, enforcing the conditions that the EZLN proposes to this end.

This is the reality that governor Roberto Albores is trying to resolve in the three years of his government, if he is able to complete his term. But how does he want to do it? What resources does he have? What social and economic policy is he carrying out?

For an integral and structural problem, an integral solution to the root of the problem is needed. We cannot speak of development if there is no peace, but not peace understood as an absence of direct armed conflict, but rather peace accompanied by justice and political, institutional and social democracy in all realms. Thus, the terms peace-development-justice are inseparable realities for promoting a solution to the crisis in Chiapas. Nevertheless, the first road to a solution is of a political nature.

Gustavo Castro Soto
Center for Economic and Political Investigations of Community Action, A.C.
CIEPAC is a member of the, Mexican Network of Action Against Free Trade (RMALC) www.rmalc.org.mx, Convergence of Movements of the Peoples of the Americas (COMPA ) www.sitiocompa.org, Network for Peace in Chiapas, Week for Biological and Cultural Diversity www.laneta.apc.org/biodiversidad, the International Forum "The People Before Globalization", Alternatives to the PPP http://usuarios.tripod.es/xelaju/xela.htm, and of the Mexican Alliance for Self-Determination (AMAP) that is the Mexican network against the Puebla Panama Plan. CIEPAC is a member of the Board of Directors of the Center for Economic Justice http://www.econjustice.net and the Ecumenical Program on Central America and the Caribbean (EPICA) http://www.epica.org. Center for Economic and Political Investigations of Community Action, A.C.


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Centro de Investigaciones Económicas y Políticas de Acción Comunitaria
CIEPAC, A.C.
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Translated by Witness for Peace for CIEPAC, A. C.


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