Decentralization and local government development in rural areas of Latin America^[36]

T. Lindemann
Tomás Lindemann, Rural Development Officer, Rural Institutions and Participation Service, FAO

A reinvigorated municipal structure is emerging in Latin America, setting the scene for an important legislative transformation that should give local rural constituencies greater control over local institutional organization, ensure increasingly sustainable management of natural resources and reduce poverty. This transformation of rural areas does, however, require external inputs to initiate appropriation of institutions by local people. Priorities in the process should be identified through participatory and iterative decision-making and planning, informed by learning gained from field experience and documented best practices. The role of external projects in the process should be solely facilitative, enabling interaction among local actors and documenting the processes from a technical standpoint.

BRIEF DESCRIPTION OF PROCESSES IN THE LEMPIRA DEPARTMENT, HONDURAS

The Lempira Sur project was established at the end of the 1980s to prevent drought from causing severe famine. The project was implemented by the Government of Honduras with technical support from FAO and financial resources from the Government of the Netherlands between 1990 and 2004.

The major priority of the project was initially food security. The premise for achieving food security was that food needed to be produced locally, rather than being supplied from external sources. Traditionally, local staple foods were produced on the hillslopes with inclinations that averaged more than 30°. Food was produced through slash-and-burn agriculture, a legacy from precolonial times and which has a strong cultural value. In the past, this was a sustainable agricultural practice, as people could migrate freely after each crop, and it had been successful in feeding local populations for millennia. However, by the early 1990s, it was no longer sustainable owing to a number of factors, namely:

• population growth in mountainous areas, which had rendered the possibility of migrating after each crop increasingly unfeasible;

• control of the valleys by plantation activities, especially by fruit corporations;

• massive introduction of livestock in tropical areas;

• privatization and other changes affecting land tenure.

Local food production was the first measure proposed to deal with the changed situation. It was also recognized that the impact of drought could have been minimized had the farmers adopted more sustainable production practices. It was thus concluded that the Lempira Sur project should promote the adoption, on the widest possible scale, of sustainable agricultural practices that preserved, rather than destroyed, the existing vegetation.

The project aimed to respond to a crisis that did not discriminate between social groups, but had an evenly disruptive impact on all sectors. It therefore helped to bridge gaps between the better-off and the marginalized population groups, thus creating the conditions for alliances between both sectors and a common approach to addressing the crisis.

At the same time, the project enabled the development of the local institutional arena, which was largely controlled by traditional institutions such as the patronato (board of management). The first step was to modernize the structure of the patronato in order for it to respond more effectively to the needs of the democratic societies evolving in Central America.

One important step in that process was the establishment of sectoral commissions within the communities to address the various aspects of the agricultural and food security crisis. The process of establishing these communal commissions (described in more detail below) was key to devolving power beyond the existing local elite.

Once the commissions had become operational, it became clear that the patronato was no longer capable of responding to the increasingly structured and organized demands of grassroots organizations. With the support of the project, communities engaged in a dialogue about the need for an alternative designation for the patronato, which subsequently evolved into the community development council, or Consejo de Desarrollo Comunitario (CODECO).

In the case of Lempira, local development councils were at the heart of the project's success in eliminating the burning of fields. CODECOs also played an essential role in negotiating better uses for upstream water reserves by putting pressure on cattle farmers to prevent their animals from feeding near the water, thus greatly protecting the vital natural resources.

KEY FACTORS FOR PROJECT SUCCESS

Long-term commitment to rural development

From the outset, the donor (the Government of the Netherlands), the recipient (the Government of Honduras) and the executing agency (FAO) agreed that the socio-economic, institutional and environmental transformation needed to achieve food security and rural development in Lempira Sur would require a long-term commitment and investment. Thus, the project was planned to run for a minimum of ten years. This enabled project management to:

• build a multidisciplinary team of technical staff who were not only professionally qualified but also willing to adopt a learning approach and view themselves as local process facilitators (rather than subject matter experts) who would teach the local populations how and what to do;

• build a relationship of trust with and an understanding of local partners and social power relations;

• undertake field-level experiments of different approaches to the bottom-up consolidation of institutions, as well as to the management of natural resources in order to identify best practices;

• counterbalance the influence (on the project's budget and other resources) of those representing "hard sciences" (agronomists, veterinarians, forest engineers, etc.). In practice, this was not always possible, as such project staff tended to be allocated a greater share of budgetary resources for most of the project's duration, leaving less for experts from the "soft sciences" (sociologists, planners, communication specialists, etc.), who were not considered to be technical staff.

Operating in an institutional vacuum can be advantageous

When project operations commenced, the presence of institutions in Lempira Sur was limited to: religious entities, especially the Catholic Church; the municipalities; and one key non-governmental organization (NGO), financed by religious NGOs, i.e. the Central Committee for Water and Integrated Development of Lempira (or Comité Central Pro Agua y Desarrollo Integral de Lempira [COCEPRADIL]). This NGO had been established in the 1970s to foster water supply projects in remote communities, which it achieved with highly successful results and to the satisfaction of local communities. The general institutional vacuum, together with the positive record of COCEPRADIL, helped the project gain credibility in the department, as people had no reason to distrust government projects, which is a frequent reaction in many rural areas of Latin America.

Choosing entry points that cut across social differentiation

Many development projects that target small communities in rural areas tend to perpetuate social differentiation by putting the resources in the hands of wealthier groups. The Lempira Sur project successfully addressed this issue by identifying constraints that affected the better-off as well as marginalized groups, in order to work on common ground where both groups would be equally interested and did not have conflicting interests.

One such example was that all social groups lived in homes of a similar design, with the kitchen in the house and a grain store loft above. The kitchen stoves consumed a large quantity of firewood and generated a large amount of smoke, which rose into the loft. While this preserved the stored grains and repelled insects, women and children, especially the youngest, spent much of the day inhaling this smoke. This had a devastating effect on their health, and local clinics were registering 70 percent female admittance for respiratory complaints related to smoke inhalation.

The establishment of communal commissions addressed sectoral issues such as housing, education, health and pathways, which would assist people in their efforts to restructure their houses. These sectoral commissions were led by volunteers.

Over time, these commissions accessed important in-kind and cash resources from the project and the local communities, to the extent that their negotiation capacities increased considerably, thus empowering different actors within the communities and enabling their active participation in negotiation processes within the patronato. It was then only a matter of time (two to three years) before communities realized that the patronato was not capable of addressing the increasingly organized demands from the sectoral commissions. The project then facilitated communal negotiations, which eventually led to the establishment of the CODECO.

Empowered through the bottom-up consolidation of their political capacities, CODECOs soon became the platform for communal decision-making. However, given their limited economies of scale, they needed to link to higher-level institutions in order to: (a) manage natural resources within the local watersheds in a sustainable and productive manner; and (b) access and influence resources and services provided by central government and other actors. The only appropriate institutional forms present in the region were the local municipalities (discussed below).

Establishing strategic alliances

From the outset, the project established a strategic alliance with the local bishop. The celebradores de la palabra, or local lay leaders, responded positively to the project proposal because its economic activities complemented their social struggles. However, this created tensions with the local priests who, like other local power brokers, found it difficult at times to adjust to a development strategy that implied a loss of patronage and the continual need to earn a leadership role by providing concrete answers to concrete problems. However, those priests who understood the logic behind the project's approach (the institutionalization of decision-making processes) became its strongest allies. When the bishop was actively involved, the problems were resolved. When his involvement declined as a result of ill health, tensions with certain priests rose, particularly as lay leaders tended to prioritize activities that led to material benefits for their supporters.

Using constitutional tools to promote participation

The project promoted the use of such constitutional tools as the plebiscito (referendum) when communities needed to resolve confrontational issues. For instance, when the powerful and wealthy cattle producers of one municipality opposed the idea of prohibiting the use of fire in agriculture and cattle ranching, the mayor, with support from the municipal development council or Consejo de Desarollo Municipal Ampliado (CODEM) decided to hold a municipality-wide plebiscito, the result of which would be a municipal law. The major landowner and cacique (traditional chief) of the municipality was convinced that he could manipulate the local population to vote in favour of allowing the use of fire in agriculture and cattle ranching, and so agreed to hold the referendum and promised to respect its outcome. The mayor and the Municipal Environment Committee, with the support of the local priest and the son of the traditional cacique, rallied the population in favour of the local ordinance banning the use of fire, while the cacique rallied his supporters, offering financial incentives. The plebiscito was won by a majority of more than 75 percent, and the power of the cacique was broken.

No incentives to manipulate opinion

Project management staff consistently refused to offer local populations incentives, which many development projects use to persuade local people to pursue approaches promoted by a project. By consistently rejecting this practice, the Lempira Sur project succeeded in building local ownership of project resources.

STATE REFORM, DECENTRALIZATION AND RURAL DEVELOPMENT

Enabling factors for decentralization

Decentralization has been high on the policy agenda for many decades. However, in the period before structural adjustment programmes and globalization became popular concepts, decentralization was viewed as a managerial tool to improve the effectiveness of sectoral public institutions (such as ministries of agriculture and health) at the local level. Instead of being considered as a decentralization process, it was a process of institutional de-concentration.

Nevertheless, significant developments in Central America have created new opportunities for a paradigmatic reform of the state that would enable cross-sectoral decentralization processes as a result of the following factors:

1. The implementation of structural adjustment policies has dramatically changed the institutional setup in most developing countries, weakening the state and especially sectoral ministries, which have demonstrated little capacity to assume their new normative role. At the same time, there has been a devolution of the operational responsibilities of local governments without provision of the necessary resources. The problems encountered in implementing these changes have led to the possibility of a paradigmatic shift from sectoral planning (top-down) to territorial governance (bottom-up).

2. The return to democratic government in many developing countries - especially those of Latin America - has resulted in constitutional modifications that allow for local election of municipal authorities.

3. The signing of peace agreements in Central American countries in the 1980s and 1990s ended traumatic conflicts between right-wing paramilitary forces and left-wing guerrillas, which had had a disruptive effect on all economic activity in the region.

However, more often than not, state reform has been an argument to justify the removal of the state's role as a provider of sectoral products and social services. The strategies that were invoked to reform the state included privatization and decentralization. Although it now seems very obvious that these have not been consistently successful in bringing about the desired changes, it is also broadly admitted that (a) the initiated transition is irreversible and (b) the new situation holds promise for democratization as long as the necessary mechanisms for community control over municipal decision-making processes are in place. These mechanisms were successfully developed in the Lempira Sur project.

One of the greatest challenges for rural development is transferring capacities to local-level institutions for the delivery of services that were previously provided by sectoral agencies of government. The advantage of such transfers is that local institutions are in close contact with the day-to-day life of the farming population. Furthermore, in a situation where communities take control of their own local institutions, they are in the best position to determine the type and quality level of services required. There is little evidence that privatization of services can significantly improve their delivery for small farmer populations. In contrast, there is increasing recognition that representational institutions consolidated from the bottom-up will enable improved delivery of essential services, significantly enhancing the capacities of states to satisfy the requirements of their populations.

Constraints on rural development

Rural dwellers have traditionally been viewed as suppliers of food for home and market consumption. However, recent technological and economic developments (such as genetically modified organisms and the liberalization and globalization of trade) have questioned the role of small farmers as suppliers of food for the market. The removal of government subsidies, the prevailing low prices of commodities, quality standards and the increasing presence of supermarket chains in even medium- and small-sized towns are pushing rural dwellers out of agricultural markets and into urban environments as an underexploited labour force.

The importance of preserving the presence of rural dwellers in their places of origin is broadly recognized by governments in developing as well as in developed countries. However, rural dwellers are facing increasing difficulties in competing on the market. In the past, most countries of Central America subsidized the production of such staple foods as maize and beans by guaranteeing threshold purchase prices. This practice has been abandoned by governments in the framework of regional and global free trade agreements.

This article does not analyse the pros and cons of free trade agreements; it does, however, contend that thousands, if not millions, of small farmers are being pushed out of farming activities because of their inability to compete with products produced by large corporations enjoying unprecedented economies of scale and applying technological innovations that are far beyond the reach of small farmers. This leads to production cost gaps that cannot be bridged.

Decentralization requires bottom-up development of local-level institutions

An essential condition for the successful decentralization of capacities to local-level institutions is that these institutions must be deeply rooted in civil society.

The primary institutional setting in rural areas is the household.^[37] Most families, even those residing in the remotest rural areas, live in villages composed of more than one household. Thus, the first challenge is for these families to be involved with local community organization. Once a village has an institution to represent it, the families (whatever their nature may be) can begin their empowerment process through their integration into the municipal structure.

These institutions are representative. It is important to make this clarification in order not to confuse these institutions with producers' organizations and financial organizations such as credit unions. Producers' organizations are an essential tool for building governance. Such organizations enable small- and medium-sized farmer households to build the economies of scale required to compete on the market. They have also played a key role in Lempira. For example, several communal banks were established. Some have been more successful than others but they have all helped build the economic capacities of farmers.

It should also be noted that producers' organizations may have conflicting interests with representative institutions. For instance, an interest group (e.g. a forestry cooperative) within a community may be very interested in cutting down trees for the production of fuelwood, in contrast with the overall community needs of preserving the vegetation cover for the production of water. It is thus very important to differentiate clearly between representative organizations (belonging to the municipal structure) and other forms of people's organizations, including NGOs, cooperatives and private companies.

Alternative sources of livelihoods

The role of natural resources in developing countries is increasingly evolving from that of supplying inputs for the industrial transformation of agricultural products towards that of providing environmental services for local communities and the global population. Environmental services may consist of the supply of public goods for (a) basic survival, such as water and oxygen, and (b) recreational purposes in the form of landscapes, cultural diversity and rural tourism.

Recognition that rural livelihoods are under threat as a result of trade liberalization and the spread of supermarket chains is key to devising new livelihood strategies for rural families and appropriate responses from the representative organizations under discussion. Only a clear understanding of the challenges facing rural dwellers can improve the chances for success of decentralization processes. As discussed below, the quality of financial capital held by a municipality is a function of the proportion of capital generated from local tax payments vis-à-vis the proportion from central government contributions. In view of this equation, it is clear that only when the economy is active in rural areas will institutions representing farmers be financially strong. It is therefore essential to identify alternative sources of livelihood for the farming populations that have traditionally relied on agricultural production for their livelihoods.

THE MUNICIPAL STRUCTURE

Importance of municipalities in Latin America

After religion and language, probably the strongest and most durable heritage from Spanish colonization of the region is the municipal structure.

The strong presence of municipalities is partly the result of the void left by sectoral institutions (such as ministries of agriculture and their extension and related services) and other institutions previously present in rural areas. Tables 1 and 2 describe the strengths and weaknesses of municipalities.

The six links in the municipal chain

In order to allow a participatory democratic process of budgetary and political planning to flourish, municipalities should play a role in linking families with higher-level decision-making bodies through the consolidation of a municipal chain. The municipal chain is composed of six links: the family, the community, the municipality, the intermunicipal association or mancomunidad, the departmental/provincial association of mancomunidades and the national association of municipalities.

First link: the family

The first link in the municipal chain is the family. Families in the present millennium differ significantly from the traditional nuclear family structure, and they will continue to evolve in the future. Whatever their structure, families remain the first socio-institutional reference for individuals. The terminology of some demographers of the 1970s and 1980s defined families as the "basic cell" of society, and this still holds true.

TABLE 1
Strengths of municipalities

TABLE 2
Weaknesses of municipalities

Socio-economic demographic trends (including the anti-agricultural bias of structural adjustment policies) are increasingly pushing millions of rural dwellers of working age to migrate to ever more congested urban environments. This migratory process is not only massive, but it is also highly selective in terms of age.

It mainly involves the working age population, with the consequence that populations left behind are becoming polarized in terms of age, i.e. children and the elderly.

An important challenge for governments and other actors concerned with the development of rural areas is to restore the appeal of living in rural areas. Strategies could include:

• compensating rural dwellers for managing the environment in a sustainable manner. This compensation could come in the form of payment for environmental services;

• developing tourism in rural areas, which are increasingly attractive for urban populations in need of the solace that can be found in a natural, pollution-free environment and areas free of violence deriving from crime and social unrest.

However, the greatest challenge in establishing strong roots of democracy and economic development lies in strengthening family ties. For this, the family needs to be linked to the community.

Second link: the community

The second institutional link in the municipal chain consists of communal institutions at village level. While they may vary from one country to another (and even between regions within these countries), communal institutions in Latin America often share the same names, such as patronato, parroquia or vereda.

These names are a legacy of Spanish colonization and immediately denote the paternalistic nature of their roots. These institutions have a number of shortcomings, for example frequent domination by powerful local groups, partisan politics and a strong bias in favour of the male population. By strengthening these institutions there is also risk of strengthening the control of resources by the more powerful to the detriment of the marginalized.

Third link: the municipality

As an innovation in the institutional arena, the Lempira Sur project successfully promoted the establishment of the widened municipal development council (CODEM Ampliado). This innovation has produced a broader representation in the traditional CODEM to include people from remote communities in municipal planning and policy-making processes. In practice, this institutional structure enables the participation of one representative from each village (with one vote each) in CODEM planning and other exercises.

On a number of significant occasions, the importance of this structure has resulted in reorienting scarce municipal funds from a traditional pro-urban bias^[38] towards an increasingly greater proportion being assigned for (a) solving urgent problems (such as access to drinking-water) in isolated communities; and/or (b) addressing investment priorities for the development of rural production.

Until now, there has been little evaluation of whether the overall capacities of municipalities to promote rural development have increased in recent years. However, the extent of success of a decentralization programme could easily be measured by evaluating how, or simply whether, the three dimensions of decentralization (i.e. the political, financial and administrative) have evolved within municipalities. Considerations for measuring decentralization could include the following:

Political capacities

• the extent to which CODECO representatives from small villages participate in municipal planning exercises and decisions over the use of municipal budget allocations (the Lempira Sur project achieved this by facilitating the establishment of the CODEM Ampliado) and thus the extent to which the municipality is pursuing a truly bottom-up approach in the design of its decision-making processes;

• the extent to which municipal authorities are accountable down the line to local constituencies (here again, the CODEM Ampliado was a key tool);

• the balance between genders in decision-making processes;

• the extent to which municipal services are reaching remote communities (a strong CODECO can ensure this);

• the chance that representatives of small villages can be elected municipal mayor;

• the extent to which electoral decisions are based on partisan preferences rather than policy priorities;^[39]

• the capacity of municipalities to influence higher levels of policy decision-making. This capacity is frequently a function of municipal integration into municipal associations that increase negotiation capabilities vis-à-vis regional and national government decision-making processes.

Financial capacities

The financial capacities of a municipality consist of budgetary and service allocations. Most municipalities in rural areas are dependent to a high degree (usually up to 90 percent) on contributions from external sources. In the course of the past decade, new actors are beginning to fund municipalities. These include bi- and multilateral donors, social funds, etc.

The quality of the capital held by a municipality is a function of the proportion of its funds coming from internal sources. The higher this proportion, the healthier the municipal finances, in terms of downward accountability. Thus, a key challenge for the municipal chain is to strengthen its capacities to raise income from local taxes.

Administrative capacities

Administrative capacities consist of the human and infrastructure capacities at the disposal of a given municipality, such as:

• the professional qualification of the mayors and their staff;

• the quality of available office premises, office equipment, electricity, telephone lines, access to the Internet, etc.;

• the extent to which national programmes are reaching the municipality;

• the extent to which the municipality is investing in:

  a) basic requirements such as drinking-water supply, electricity and telephone networks;
  b) the sustainable management of natural resources, such as watersheds;
  c) risk management activities;
  d) production and marketing infrastructure;

• the extent of municipal participation in the mancomunidad and its institutional development.

Fourth link: the intermunicipal association or mancomunidad

In addition to the above-listed problems, which are of an internal nature, municipalities also face problems of an external nature, for example: (a) their lack of economies of scale; (b) their lack of political influence in regional and national levels of policy decision-making; and (c) the mismatch between geographical realities and institutional dynamics. To address these problems, municipalities are increasingly resorting to different sorts of horizontal intermunicipal arrangements.

Fifth link: the departmental/provincial association of mancomunidades

This is where the municipal chain meets the central government chain. In other words, this is the point where two conflicting dynamics meet (i.e. the bottom-up and the top-down). It is therefore the point where the strength of the municipal chain will be tested. In Honduras, a new institutional structure was recently established, the Consejo de Departamental de Lempira (CODELEM), which has met resistance from mayors and other local actors who view the CODELEM as a top-down construction that does not reflect their internal processes.

When municipal dynamics (e.g. electoral processes, budgetary and policy planning, programme and project design, implementation and execution) are all carried out with strong civil society participation, intermunicipal associations will be empowered to obtain the best results in negotiating with provincial or department-level authorities, irrespective of partisan dynamics.

Where such intermunicipal associations are strong, they will dramatically curtail the costs of programme and project design and implementation, as well as the costs of accountability and monitoring and evaluation, thus greatly contributing to the cost-effective management of scarce provincial budgetary resources.

The complexity of this challenge is self-evident. In many countries of Africa and of the Latin American region, provincial and department governors are designated by central governments. A large number of countries of the Latin American region, however, have mechanisms for the popular election of governors. Whatever the case may be, provincial governors tend to be more responsive to central government authorities up the line than to local constituencies down the line; this is only natural, given their relative distance with respect to those populations.

Sixth link: the national association of municipalities

In a number of countries, national associations of municipalities have emerged over the years. These experiences are still very recent and face various limitations, including:

• control of urban over rural municipalities;

• partisan control;

• financial control by external actors;

• trade union behaviour.

However, a national association of municipalities offers a number of advantages. For example, a strong national association of municipalities can become a legitimate interlocutor with central government authorities up to the level of the president of the republic. This potential capacity is a unique feature for the empowerment of rural families. Through the municipal chain, the rural family is thus in a position to influence national policy decision-making processes. Such influence enhances participatory democracy.

This means that national policies and programmes will be determined from the grassroots level. This has political, financial and administrative advantages, for example:

• political advantages as a result of civil society seeing its views reflected in national policy decision-making;

• administrative advantages in the enhanced and homogenized quality of training of mayors and mayoral candidates while still respecting local-level needs;

• financial advantages by enabling bottom-up project, programme and policy formulation processes to be borne by local-level actors. In contrast, sectoral services (e.g. extension, technical assistance, credit) can be channelled down the line by the national association of municipalities towards the lower levels at lower costs.

CONCLUSION

Rural dwellers are facing a crucial challenge for their survival. They can no longer rely only on the production of food items for self-consumption and for the market, but need to diversify their sources of income from natural resources. The management of natural resources is not only related to the sources of income for small farmers - it is also related to the management of risks associated with natural hazards such as mud slides and soil erosion. The management of natural resources needs to involve criteria of sustainability and cannot be left to the discretion of single producers. It should be undertaken within the framework of appropriate institutional structures. This article has argued that, in the case of Latin America, the management of natural resources should be integrated within a chain that links the family with national governments through municipal structures.

The municipal chain is best positioned to link poor rural producers and their families with higher decision-making levels

It is broadly recognized that the closer the institutions are located to their users, the more effective they will be. This is known as the principle of subsidiarity.^[40] In the Latin American context, the institutions that are closest to civil society are the municipalities. However, while on the one hand municipalities are too small to reach directly into policy decisions at central government level, they are also too big to reach all families, especially those residing in remote rural areas. For this reason, a chain needs to be built to connect the rural producers and their families to the communal (representative) institutions of their villages and through them to municipal decision-making processes. The chain should continue up the line to regional intermunicipal associations and, subsequently, national associations of municipalities which will then be empowered to establish a dialogue among equals with central government decision-making bodies.

Connection between local institutional capacity building, food security and natural resources management begins at the family level

More often than not, natural resources are the main source of cash income for rural families (when not used merely for subsistence). Given the scarcity of financial resources that municipalities usually receive from central governments, municipalities increasingly rely on locally raised taxes. However, the capacity of local populations to contribute financially to the municipal tax base depends greatly on their use of natural resources as well as income obtained from off-farm economic activities. These resources seldom suffice to fulfil their livelihood requirements. This is probably the greatest hurdle to the development of rural municipal life.

Watershed management requires governance structures that go beyond the political territorial division

Watersheds frequently cross national and subnational territorial boundaries with no respect for cartography. Different types of dwellers settle and organize into villages and towns of different sizes beside the watershed. Depending on a number of conditions, the management of these watersheds may be more or less sustainable.

The first problem for the sustainable management of watersheds is that settlers along river basins frequently fail to see the watershed as a unity with an interdependent logic that begins at the upper part of the river and carries its problems downstream.

According to the results of participatory rural appraisal exercises carried out with facilitators from an FAO project, rural producers who do not migrate (or who no longer migrate) and who have settled along the Río Grande in northern Argentina fail to understand that there is a connection between the origin of the watershed in the Bolivian Plateau (Altiplano) and the characteristics of the river downstream. Owing to this lack of awareness, rather than addressing the root issues, the settlers tend to quarrel with their immediate upstream neighbours, blaming them for the scarce water supply.

Risk is best managed by the municipal chain

When Hurricane Mitch hit Central America, the Lempira Sur project was well into the second half of its second phase, thus in the eighth year of implementation. It had already shown consistent results in addressing the environmental crisis of the early 1990s for which it had been established. The Government of the Netherlands then requested the project management to test the methodologies developed in Lempira in five other regions that had been hit by the hurricane.

Towards the end of this emergency project implementation, a mission was requested to note the lessons learned from the US$1.5 million project.^[41] One key conclusion of the mission was that, where social capital was in place, communities were well positioned to respond to the crisis both during the emergency post-disaster moments and in the rehabilitation phase. In Lempira, social capital had been built during the rehabilitation that followed the drought of the early 1990s. Rehabilitation had produced prevention capacities to the extent that Hurricane Mitch made little impact in Lempira. It should be recognized, however, that winds and rainfall seem to have been lighter in Lempira than in the worst affected areas of the country, and it is not yet known to what extent this reduced the impact.

Decentralization processes require strong institutions at the subnational level

Devolving responsibilities to local authorities requires previously established political, administrative and financial capacities of the municipal structure. Development projects can play a significant role in breaking the inertia created by the paternalistic and clientelistic approaches that have traditionally undermined the development of democratic management structures. Rural development projects should help to reinvigorate the local dynamics that could connect rural families with communal organizational structures such as community development councils, and further up to municipal structures and national governments. This requires a long-term commitment of development projects in an all-encompassing perspective of processes at the local level. Projects need to build the capacities of territorially based institutions with cross-sectoral responsibilities. Municipalities and the representational institutions related to them at the sub- and supramunicipal levels (i.e. communal organizations and intermunicipal associations, respectively) offer such an environment. The role of rural development projects is to build the financial, administrative and political capacities of municipalities for the sustainable and productive management of natural resources.

ACKNOWLEDGEMENTS

The author is grateful for the assistance of the people of Lempira as well as the Honduran colleagues of the FAO/Netherlands project. Special thanks are due to the project's Chief Technical Adviser, Ian Cherrett, and the two National Project Coordinators, Luis Alvarez Welches and Elías Suazo, as well as to the FAO Deputy Representative and driving force behind the project, Carlos Andrés Zelaya, for technical discussions on issues related to the preparation of this article. Thanks also are due to Olivier Dubois for his substantive contribution concerning the issue of power, to Manuel Paveri for technical revision of the article and to Ana Guerrero for her meticulous support.

Décentralisation et développement du gouvernement local en zone rurale en Amérique latine

Une nouvelle structure municipale plus dynamique voit le jour en Amérique latine, ouvrant la voie à une transformation législative importante déterminant un contrôle accru des collectivités locales sur l'organisation institutionnelle locale, une gestion de plus en plus durable des ressources naturelles et une réduction de la pauvreté. Toutefois, la transformation des zones rurales nécessite des intrants extérieurs pour lancer des processus d'appropriation des institutions par la population locale, autour de priorités définies conjointement dans le cadre des processus de planification et de décision et qui soient à la fois participatifs et itératifs, s 'inspirant de l'expérience du terrain et illustrant les meilleures pratiques. Le rôle des projets externes dans ces processus est uniquement celui d'un médiateur qui observe, facilite l'interaction entre les acteurs locaux et documente les processus du point de vue technique.

Descentralización y desarrollo de la administración local en las zonas rurales de América Latina

En América Latina se está revitalizando la estructura municipal, lo que sienta las bases para una importante transformación legislativa encaminada a lograr un mayor control de la organización institucional local por parte de los entes locales, una ordenación de los recursos naturales cada vez más sostenible y la reducción de la pobreza. Sin embargo, esta transformación de las zonas rurales requiere contribuciones externas para iniciar procesos de apropiación de las instituciones por parte de los habitantes locales, basados en prioridades determinadas conjuntamente en los procesos de toma de decisiones y planificación y que son, al mismo tiempo, participatorias e iterativas, teniendo en cuenta la experiencia adquirida sobre el terreno y las mejores prácticas documentadas. La función de los proyectos externos en estos procesos no es sino la de un facilitador que observa, facilita la interacción entre los actores locales y documenta técnicamente los procesos.