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CIUDAD SANDINO, NICARAGUA – In a dusty corner of the Jubilee House Community compound outside Managua, a factory is taking shape where a cooperative of women and men hope to build a sustainable business making organic cotton yarn for clothing.
The concrete walls and metal roof trusses of the Genesis Spinning Plant Cooperative, built and assembled with help from the Bucknell Brigade to Nicaragua, are awaiting a roof and final touches. First, however, the 29 members of the cooperative must agree on a contract and secure loans and licenses to operate as a worker-owned business in a free-trade zone.
Like an already operating Women’s Sewing Cooperative next door, their goal is to engage in "fair trade" with decent wages and working conditions. Convincing the women that the long-term investment will pay off is, however, one of the ongoing struggles of building such sustainable businesses in developing countries like Nicaragua, said Paul Susman, a geography professor at Bucknell University.
"There's a challenge for any group of people to alter their behavior to work as a cooperative," Susman said. "The women in the (spinning) cooperative were independent entrepreneurs, selling fish from Lake Managua, selling everything. Their whole outlook was survival mode in which they were mostly out for themselves and their families."
Research 'an outgrowth' of brigade
Susman is conducting research on the successes and failures of co-ops in Nueva Vida, a resettlement area established for survivors of Hurricane Mitch in 1998. His research was inspired by his work with the Bucknell Brigade, which this year marks its 10th anniversary. Susman has traveled with the brigade many times as a faculty leader. Through his experiences, he was inspired to conduct research on co-ops and, with fellow geography professor Duane Griffin, to produce maps for farmers in remote areas to enable their operations to become certified organic.
Susman also has developed a three-week summer course, Grassroots Development: Nicaragua, which he offers every other year. The next class leaves for Nicaragua in mid-May.
"My research has been an outgrowth of going on the brigade with the students," Susman said. "Going down there with the students was some of the best teaching and learning experience I've ever had."
Concerns about sustainability
Several delegations of the Bucknell Brigade have worked with the cooperative on construction of the factory, which is scheduled to be completed by September. Work temporarily stopped in late March while a group of brigade alumni was in Nicaragua for a 10th anniversary trip.
"We're very concerned about the economy," co-op member Jamileth Bravo Martinez said to the alumni brigade through a translator. "We want to be producing. We've had some delays. Not only do we have to finish work but we have to organize ourselves in a better way. What concerns us is that we would spend another year without generating income for our families."
Co-op President Janet Alfara said the group is uncertain about how realistic its profit projections are.
"The reality is we don't know how much we'll earn until we have practical experience," Alfara said.
Giving up 'steady work'
Many of the women involved in the spinning co-op gave up $2-a-day jobs in sweatshops to create their own business with encouragement from the Jubilee House Community, which runs the Center for Development in Central America. JHC is the Bucknell Brigade's host agency in Nicaragua. The organization has worked with the Nueva Vida community to identify needs and launch ventures to build a sustainable livelihood.
As part of a fair trade zone, the spinning co-op members will receive higher wages, benefits and better working conditions than in the sweatshops. Their work will involve deseeding and cleaning raw cotton with antique, hand-crank machinery in a ginning plant and spinning the cotton into yarn for clothing. The clothing is to be assembled at a nearby sewing cooperative, also started with the help of JHC.
The idea for a spinning cooperative came about as a way of providing a steady supply of organic cotton for the sewing cooperative, which is in the first worker-owned free trade zone in the world. JHC has helped the spinning group secure other clients in Central America. The organic cotton will come from Nicaraguan farmers, and the yarn will be knitted together by Nicaraguan and Costa Rican workers.
Initially, JHC had hoped that the sewing cooperative would partner with the spinning cooperative to allow the spinning co-op to forego some of the startup fees, Susman said. But the sewing cooperative decided not to expand into new territory and instead concentrate on making its garment production profitable. The spinning group now is trying to secure a loan through the Inter-American Development Bank.
JHC is hoping the new spinning co-op will avoid some of the pitfalls experienced by the sewing cooperative, which now operates independently, Susman said. Members of the sewing cooperative did not put enough money into their "rainy day" fund and as a consequence were unable to sustain the principle of allowing employees to buy into the co-op after three months, Susman said. JHC hopes the new co-op will be 100 percent worker-owned.
Watching the U.S. economy
Economist Carlos Pacheco, who addressed the alumni during the March trip, noted that the Nicaraguan economy is dependent on the U.S. economy. Nicaragua has been intertwined with the United States for decades as a result of U.S. political and economic intervention.
"This (economic) crisis is affecting all countries, but some at a higher level. Nicaragua is not an exception," Pacheco said. "Because of the one market free-trade, Nicaragua is dependent on an external market. That's like having a farm with one product. Nicaragua depends on the North American market for exportation."
The Central American Free Trade Agreement, known as CAFTA, was intended to make it easier for countries in Central America to do business in the United States, Susman explained. His research shows, however, that big businesses benefit much more from CAFTA than small ones like the sewing co-op.
"The overreaching framework of CAFTA is biased for big companies and puts smaller companies at a tremendous disadvantage," Susman said. "There is enormous paperwork, a $350 filing fee, and a $10,000 bond has to be put up, just to get free trade zone status. This is an almost insurmountable obstacle for a small firm. Other requirements make it difficult for the small companies to buy in bulk, further disadvantaging them."
'Strong model' for sustainability
The spinning cooperative is, however, a strong model for sustainable business and promoting local well-being, Susman said, provided the members focus on quality and work with as many Nicaraguan producers as possible.
"The Genesis spinning cooperative is trying to set itself up, and the members are undergoing extensive education in how to be successful operators of a cooperatively structured business," Susman said. "Hopefully, they will succeed, creating income and opportunities in the immediate area."
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