² For a statistical and analytic overview of Central America's economic debt, see World Debt Tables, 1989–90 (Washington, D.C.: World Bank, 1989).Google Scholar For discussion, see Feinberg, Richard E., “Central American Debt: Genuinely Case-by-Case Solutions,” International Commission on Central American Recovery and Development (Durham, NC: Duke University Press, March 1989).Google Scholar

³ Book manuscript in progress, tentatively entitled (except Costa Rica): A Study in Poverty and Natural Resource Management (forthcoming).Google Scholar

⁴ The fact that the state helped transfer resources to the middle and upper classes does not mean that the state did not also transfer resources to the poor. On the net poverty impact of state policies, see John A. Booth, “‘Trickle-up’ Income Redistribution and Development in Central America during the 1960s and 1970s,” in Seligson, Mitchell, The Gap Between the Rich and the Poor (Boulder: Westview Press, 1984Google Scholar); Fields, Gary S., “Employment and Economic Growth in Costa Rica,” World Development, Vol. 16, No. 12 (1988), pp. 1493–1509CrossRefGoogle Scholar.

⁵ The most famous example of Costa Rica's willingness to look the other way in regard to its investors is Robert Vesco, who for many years found a haven in Costa Rica. See Lernoux, Penny, In Banks We Trust (Garden City: Anchor Press/Doubleday, 1984Google Scholar).

⁶ According to one study, the average effective protection rate for Costa Rican industry was 178 percent, as measured by the Belassa methodology. See Taylor, M., Estructura de la Protection al sector industrial en Costa Rica, (San Jose, Costa Rica,: Prodesarrollo, 1984), p. 115.Google Scholar

⁷ For environmentalist views on tropical cattle ranching, see, for example, Myers, Norman, “The Hamburger Connection: How Central America's Forests Become North America's Hamburgers,” Ambio, Vol. 10 (1981).Google Scholar See also: Caufield, Catherine, In the Rainforest (Chicago: University of Chicago Press, 1984Google Scholar); Schwartzman, Stephan, “Bankrolling Disasters—International Development Banks and the Global Environment” (Washington, D.C.: Sierra Club, 1986)Google Scholar; Rich, Bruce, “The Multilateral Development Banks and the United States,” Ecology Law Quarterly, Vol. 1, (1985–86), pp. 687–746Google Scholar; and Nations, James and Leonard, H. Jeffrey, “Grounds of Conflict in Central America,” in Maguire, Andrew and Brown, Janet Welsh, eds., Bordering On Trouble: Resources and Politics in Latin America (Bethesda: Adler and Adler, 1986), pp. 55–100Google Scholar.

⁸ For discussions of deforestation, see Hartshorne, Gary et al. , “Costa Rica: Country Environmental Profile,” AID Contract No. OOO–C–00–1004–00, (San José, Costa Rica,: Tropical Science Center, 1982), p. 50Google Scholar; Solero, Alonso Ramirez and Ulloa, Tirso Maldanack, eds., Desarrollo Socioeconomicoy elAmbiente, (San José, Costa Rica,: Fundación Neotropica, 1988), p. 77Google Scholar; Direccia General Forestal, Boletin Estadistica (José, San, Costa, Rica: DGF, 1987 No. 2, p. 64;Google Scholar Steven S. Sader, “Monitoring Historical Changes in Costa Rican Forests from 1940 to the Present,” paper presented at the Land and Resource Evaluation for National Planning in the Tropics, International Conference, Mexico, 1987.

⁹ For a history of the Latin American cattle industry, see Jarvis, Lovell S., Livestock Development in Latin America (Washington, D.C.: World Bank, 1986).Google Scholar For a more critical view of the cattle expansion, see Williams, Robert, Export Agriculture and the Crisis in Central America (Chapel Hill: University of North Carolina Press, 1986CrossRefGoogle Scholar).

¹⁰ World Bank, “Report and Recommendation of the President of the International Bank for Reconstruction and Development to the Executive Directors on a Proposed Loan to Costa Rica for an additional Agricultural Credit and Development Project,” Report No. P-2042-Cl, April 14, 1977, p. 12.Google Scholar

¹¹ See analysis of the first loan in the World Bank's second agricultural credit loan to Costa Rica.Google Scholar

¹² Even an $18,000 loan—the average subloan originally contemplated by the Bank—is hardly a loan to a “small” farmer. In fact, $18,000 represents an amount greater than the maximum total assets ($13,000) which is generally used to define “small farmer” for statistical purposes.Google Scholar

¹³ For the derivation and analysis of these data, see Annis, “Where Dual Debt Comes From: The History and Politics of Costa Rican Cattle Ranching,” Chapter 5 of author's manuscript in progress; see footnote 3.Google Scholar

¹⁴ Derived from data in Secretaria Ejecutiva de Planificacion Sartorial Agropecuaria y de Recursos Renovables, Naturales, El Sector Agropecuario: Diagnóstico (San José, Costa Rica: SEPSA, 1986), p. 168Google Scholar and Solero, Alonso Ramirez and Ulloa, Tirso Maldonado, “Primer Informe sobre el estado,” Unpublished Draft (San José, Costa Rica,: prepared for Fundación Neotropica, November 1987), p. 63Google Scholar; For more information, see also Hartshorne et al., Costa Rica: Country Environmental Profile, pp. 28, 69, and 86; and Saborio, Rocio et al. , “Programa de reactivatión de la Ganadería Bovina de Carne en Costa Rica,” Institutor Interamericano de Cooperation para la Agricultura (IICA) and Secretaria Ejecutiva de Planificación Sectorial Agropecuaria y de Recursos Renovables (San Jose, Costa Rica,: SEPSA, 1985), p. 1.Google Scholar

¹⁵ Even if revenues from domestic beef consumption and beef production that did not receive government financing are included, credit to beef still exceeded beef revenues. These conclusions are derived from Banco Central de Costa Rica, “Crédito y cuentas monetarias 1950–1985” and “Cifras de produccion agropecuaria 1957–1984” (San José, Costa Rica: Department de Investigations Estadisticas). It should be noted that some credit went to dairy production, though beef cattle received by far the larger share. Only four to eight percent of all cattle are raised for milk production. In addition, dairy producers are much more likely to be small farmers, who have less access to credit than do large farmers. Finally, the government was not trying to encourage dairy production, but was in fact importing cheap milk from the United States for the benefit of consumers. Milk producers were not heavily targeted for credit assistance.Google Scholar

¹⁶ By early 1987, almost two-thirds of the cattle portfolio was in arrears. It should be noted that to be “in arrears” does not necessarily mean that the borrowers will default. Also, because beef prices are cyclical, rates of default and the proportion of loans in arrears vary from year to year. Available data indicate that in the early 1980s, cattle raisers were poor though somewhat better than average borrowers. For example, while about 51 percent of all loans granted by the Banco Nacional in 1983 were nonperforming, about 37 percent of the cattle loans were in this category. (Thais Acosta Rosales et al., “Análisis de los factores determinantes de la morosidad de la cartera agropecuaria del Banco Nacional de Costa Rica,” thesis prepared for Facultad de Ciencias Económicas, Universidad de Costa Rica, 1985, p. 30). With widespread default threatened, cattle growers were able to secure concessionary rescheduling from the government in 1985. Moreover, by early 1987, the cattle growers had one of the worst payback rates in the loan portfolio. (Information on loan repayment rates prior to 1980 is not available.)Google Scholar

¹⁷ Accurate data on loan default and arrearage is difficult to obtain. Repayment information is not normally broken down sociologically, i.e., by “large farmer,”“small farmer.” However, personal interviews with several knowledgeable high-level Costa Rican banking officials strongly reinforced the conclusion that large farmers were far more troublesome borrowers than small farmers. Indeed, no banker showed surprise or even mildly disagreed with the statement when it was cast as a question. For agriculture in general, in 1986, 70 percent of the medium and large producers were reported behind on their payments, compared to only 35 percent of the small producers. These data refer to all 1986 agricultural loans from the Banco Nacional de Costa Rica. This bank is the largest state bank, granting almost half of the total credit allotted by the state banking system. (Banco Nacional de Costa Rica, advertisement in La República, March 25, 1987).Google Scholar

¹⁸ Banco Central de Costa Rica, “Estado del ejecución del programa de crédito 1985” (San José, Costa Rica: Banco Central de Costa Rica), chart 3. Information Basica del Sector Agropecuario de Costa Rica (San José, Costa Rica,: SEPSA, 1989), cuadro 67.

¹⁹ Based on data from Secretaria Ejecutiva de Planificación Sectoral Agropecuario y de Recursos Naturales, Information Basica del Sector Agropecuario de Costa Rica, No. 4 (San José, Costa Rica,: SEPSA, 1989), cuadro 67.Google Scholar

²⁰ See “A Case of Rice,” in chapter 5 of manuscript in progress (see footnote 3). Also see Piszk, Ileana, “La Productión de Arroz in Costa Rica: Políticas Estatales y Fuerzas Sociales 1970–1980” (Institute de Investigaciones Sociales, Universidad de Costa Rica, 1982).Google Scholar

²¹ This theme is developed in Sheldon Annis and Katherine Griffith, “A Pro-Poor Funding Strategy for Natural Resource Management in Costa Rica,” report to the Ford Foundation, February 1990.Google Scholar

²² Under the Brady Plan, Costa Rica may “buy back” up to 60 percent of its external debt at its secondary market value of about 16 cents on the dollar. The remaining 40 percent will retain its par value but can be rescheduled. To accomplish the buy back, a relatively modest $180 million has to be raised. Some of this can come from grants, possibly from the United States Economic Support Funds.Google Scholar