Introduction: The Central American Agro-Export Economy — Issues and Debates

Abstract

Since colonial times — and possibly before — Central America has been geared to the primary-export economy. Primary commodity exports still represent one half of material production and two-thirds of foreign exchange earnings, and are thus the single most important growth factor in the region. Although this sector embraces mining, forestry and fishing it is dominated by agricultural exports organised mainly in large enterprises which obtain labour and food from the mass of small peasant farmers who surround them. Despite the large profits to be made and high production growth rates in the three postwar decades, sustained economic development has not been attained in Central America. On the one hand, the cyclical transformations of demand patterns in metropolitan markets have led to the familiar cycles of ‘boom and bust’ over the centuries. Industrialisation — other than export processing — has been a recent phenomenon in Central America, with serious shortcomings in terms of efficiency and market size. On the other hand, the emergence of a social structure made up of repressive regimes, footloose foreign investors and an impoverished semi-proletarian peasantry, has led to a weak civil society subject to both US intervention in support of its oligarchies and mass movements against exogenously induced modernisation.