USAID selects Palladium for agriculture project in Colombia

17 May 2023 3 min. read

USAID’s Sustainable Agriculture Activity – a five-year, $50 million project that aims to support legal, profitable, and sustainable agricultural businesses – has selected Palladium to support a project in Colombia. The program aims to give farmers alternatives to the illicit production of coca.

Colombia boasts remarkable biodiversity, with extensive forests and diverse natural ecosystems. However, the country has suffered from conflict, deforestation, mining, and unsustainable agricultural practices. Farmers in Colombia have historically been forced to engage in illicit activities like the cultivation of coca, the precursor to cocaine, which continues to fuel the drug trade to the detriment of the local communities and environment.

Growing coca leaves is far more lucrative than any other possible alternative in much of rural Colombia, leaving many communities without any alternative and leaving them vulnerable to the drug-fueled internal violence.

USAID selects Palladium for agriculture project in Colombia

Colombia has suffered for decades from a devastating internal conflict between far-left guerilla groups and government-aligned paramilitary squads.

The USAID-funded program seeks to boost alternative ways for rural communities to make a living without falling into the conflict and illicit activities that much of Colombia continues to grapple with.

The project aims to prioritize sustainable production using processes that can conserve energy and resources. It specifically focuses on the value chains related to the production of traditional agricultural products like coffee, cacao, dairy, fruits, vegetables, and even rubber.

The initiatives piloted with support of Palladium will primarily target the interior regions of Southern and Eastern Colombia, areas that are particularly affected by internal conflict. It will also be aligned with the Government of Colombia’s existing rural development initiatives.

“We’re focused on market systems linked with environmental sustainability, because we believe that they must be linked for producers to make sustainable choices,” said Katie Paguaga, Palladium’s Director of Economic Growth. “The reality is that selling carbon credits or ecosystem services is not enough for a livelihood, it must also be combined with improvements in efficiency, productivity and quality, leading to a profitable and sustainable business.”

“If we really expect a farmer to change the way they work and choose not to participate in illicit activities, they must have a licit pathway out of poverty, and that’s only possible if they can increase crop productivity, get higher prices and professionalize their farms, all in a way that’s climate-resilient,” Paguaga added.

Colombia is threatened by deforestation at an increasing rate, with the UN reporting that 2,000 km2 of forest is lost per year. Supporting the cultivation of non-timber forest products like medicinal plants, resins, fruits, and seeds can help Colombia to fight against the threat to natural habitats.

A new anti-deforestation law passed by the European Parliament this year will force EU companies to comply with strict rules on importing products from countries being affected by deforestation, including Colombia, Brazil, and Indonesia. Special documentation will be required to prove imported products were not produced on recently deforested land. This aims to disincentivize deforestation by limiting the foreign export markets where such products can be sold.