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Aid that works: A new road, farmer co-op revitalizes rural El Salvador

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Outside this small town in the rural north of El Salvador, a sleek, new ribbon of black asphalt known as the Northern Highway connects local farmers to the headquarters of El Salvador Produce, a farmers cooperative.

Here, an air-conditioned office space and spotless warehouse, which is outfitted with stainless steel sorting tables and cold storage, stand out in a region otherwise overwhelmed by poverty. El Salvador Produce – created in 2010 and funded by the United States-backed Millennium Challenge Corporation, which also paid for the Northern Highway – offers local farmers a commercial “cooperative of cooperatives” of the size and sway that enables them to directly supply the country’s major supermarket chains and boost their earnings.

Before, small growers of bananas, papaya, pineapple, tomato, avocado, and peppers had no choice but to sell their harvest to intermediaries who paid dismal prices and bundled and sold the produce at higher prices to the Wal-Mart and Super Selectos chains in San Salvador, the capital.

The Millennium Challenge Corporation is now wrapping up a $461 million investment in El Salvador under a five-year “compact,” or partnership, that officially ended last month. Under the MCC model, countries submit proposals for funding; once accepted, participating countries have to continue to meet stringent requirements around democratic governance and economic freedoms to remain eligible. Ramirez and the other member growers say they are expecting a visit by US officials flying in from Washington next week to mark the end of the compact.

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