By Eric Green
Washington File Staff Writer

Washington -- A food agency of the United Nations will work with the government of Nicaragua to help small-scale coffee growers adversely affected by the global crisis in coffee prices.

In a January 20 statement, the U.N. Food and Agriculture Organization (FAO) said it will assist Nicaraguan government authorities to prevent food shortages among the worst-affected coffee growers and, at a later stage, help them diversify their crops and produce more competitive varieties for the international coffee market.

The FAO said that falling international coffee prices have hurt Nicaragua's economy -- which is largely dependent on coffee -- by reducing income, employment, and food security for thousands of rural families in the Central American nation.

With production expenses currently higher than commercial value and a credit system riddled with debt, many farmers have been forced to abandon their coffee plantations, the FAO said.

FAO's Permanent Representative to Nicaragua, Loy Van Crowder, said that coffee cultivation in Nicaragua accounts for almost a third of the country's agricultural employment.

"The consequences of this [coffee] crisis are devastating for a country where external debt is 10 times larger than the total value of export earnings," said Van Crowder.

For its part, the U.S. Agency for International Development (USAID) has responded to the current coffee crisis in Nicaragua and Central America by leveraging resources through partnerships with allies in the coffee industry, non-governmental organizations, local producer groups, donors, and financial institutions.

In 2002, USAID signed an agreement with Nicaragua and other Central American nations to provide $8 million for a market-based program to assist small and medium-sized coffee producers to improve coffee quality, form new business linkages, secure longer-term contracts with the specialty coffee industry, and identify and implement diversification options for producers who cannot be competitive.

Meanwhile, Nicaraguan authorities have requested FAO assistance to safeguard the food security of some 3,000 of the worst-affected coffee-producing families in the Matagalpa and Jinotega regions of Nicaragua, where much of the country's coffee is typically grown.

The FAO said that in order to prevent food shortages, it will distribute some 110,000 kilograms of black bean seeds, 270,000 kilograms of fertilizer, and 9,000 basic tools to 3,000 of the worst-affected coffee producers and their families.

Black beans are a diet staple in Nicaragua, the FAO said. The agency said it hoped that each farmer will plant just under a hectare of black beans for their own consumption and sell the rest locally, a measure which aims to open the way toward much-needed agricultural diversification.