Professor of History

                  Internal Migration and Urbanization in Nicaragua

Development: Model and Reality

In the classic model of capitalist development, the introduction of commercial agriculture results in a rapid expulsion of the population from the countryside. Landless peasants, who lose their jobs in the process of the improvement of agricultural productivity, migrate to the urban centers, where the most dynamic sector of the economy, capitalist industry, is centered. This classic model occurs when commercial agriculture breaks up the homogeneous non-capitalist process of production and self-sufficient economic units, which generate both agricultural and non-agricultural goods. Capitalism relocates the production of non-agricultural goods in the urban areas, which become the centers for industrial development. Simultaneous with this process, a part of the peasantry is also relocated in the cities to provide labor force for the new industries.

This classic model was not established in Nicaragua; instead, the country developed an export-oriented agricultural system. In Nicaragua, capitalism gradually dissolved the non-capitalist relations in agriculture and freed a part of the labor force from its ties to the land, but it did not create an urban industrial sector to absorb the "freed" labor force. Indeed, the initial phase of the development of commercial agriculture (late nineteenth and early twentieth centuries), which was based on coffee production for exports, increased the demand for labor in the rural areas. The new demand for labor was not only in agricultural production but also for related activities, such as the building of roads, preliminary processing of agricultural products, and expanding the service sector.  Therefore, the majority of subsistent farmers who had lost their land found jobs in coffee-producing areas; and no population repellent factor accompanied the commercialization of agriculture in its initial stage.

It was during the later phase of capitalist development in Nicaraguan agriculture (the period of consolidation, and later stagnation, of coffee production up to the early 1950s), that the population repellent element of capitalist agriculture became a common feature of the process. However, because of the lack of industrialization, there was no major population attraction centers in the urban areas, and most of the people who were repelled from one agricultural zone ended up in another. They were either seeking jobs as agricultural laborers or opportunities for subsistent farming in agricultural frontiers.

But when cotton became the main cash-crop in the second half of the twentieth century, both the demand for a rural labor force and opportunities for family farming sharply declined in Nicaragua. Cotton production took over a major part of the land not occupied by coffee plantations, especially in the Pacific zone. Cotton production was also highly mechanized, and as such, it did not need a large, permanent labor force.

The second half of the twentieth century also witnessed a sharp growth in cattle production. Allocation of large tracts of land to cattle-raising, with its minimal demand for labor, contributed to the process of land loss among small peasants and intensified the wave of migration out of the rural areas.

Meanwhile, the national government's attempt to industrialize the country, especially in the 1960s within the framework of the Central American Common Market, created the population attraction element in the cities and boosted the rural-urban migration.

This brief overview of internal migration in Nicaragua indicates the important impact of different phases of economic development on population movement in the country.

Coffee Cycle

The initial phase of the Nicaraguan capitalist development, which was based on coffee production, began in the second half of the nineteenth century and reached its peak during the presidency of José Santos Zelaya (1893-1909). In its initial phase, the introduction of capitalism into the agricultural sector did not expel the rural population.

The department of Matagalpa is a good example of development of a coffee zone in Nicaragua in regard to population movement. This department attracted a major wave of immigrants between 1906 and 1920. During this period, the population of Matagalpa increased from 44,290 to 78,226 inhabitants or from 8.8 to 12.3 percent of the total Nicaraguan population.

The initial phase of capitalist development in Nicaragua had another characteristic. In response to a chronic shortage of labor in an under-populated country, capitalism maintained and reproduced non-capitalist forms of production to assure a steady flow of cheap, seasonal labor at harvest time. Granting marginal lands for subsistent farming in return for guaranteed seasonal labor was a common practice in this particular form of capitalist economy, in which the usufructo system and minifundio structure became a perpetual part of commercial agriculture. For example, the so-called habitación (based on advance payments to the workers in return for future work -similar to debt-peonage), the colonato (extracting rent in the form of labor), and ejidataría (usage of the ejidal land for subsistence farming in return for obligatory labor for nearby landowners), were various forms of non-capitalist labor relations which still existed in Nicaragua, and were sustained by the new system. The government also introduced laws to assure the workers' compliance with labor contracts.

Non-capitalist forms of production fulfilled two major functions in the overall development of Nicaraguan capitalism, a)to overcome the problem of labor shortage by using methods of labor recruitment, which tied the workers to capitalist agricultural ventures, and b) to keep wages low by providing a semi-subsistent existence for a large sector of workers during non-harvest season, thus accelerating the rate of capital accumulation.

Capitalist development in Nicaragua, from the very beginning, was based on production for exports. For the Nicaraguan bourgeoisie, wage-relations was only one form of labor recruitment and not a vital necessity for capital accumulation. In contrast to classic models of capitalist development, the Nicaraguan bourgeoisie was not producing for the internal market and did not have to concern itself with the expansion of wage relations to its fullest extend to enlarge the national market.

Economic Change and the Initial Wave of Migration (1940s)

In the 1940s, with a rapid growth in the population and the stagnation in coffee production, Nicaragua experienced the first migratory wave out of commercial agricultural zones. The destination was either agricultural frontiers of the Atlantic region or some urban centers of the Pacific.

The two departments attracting population to rural areas were Zelaya and San Juan, both in the Atlantic zone. At the time, they were among the least developed regions in Nicaragua.

These two departments are clear examples of population attraction poles for rural-to-rural migration. Peasants, who were affected by the repellent factor of commercial agriculture began migrating to areas with large agricultural frontiers. They were primarily coming from departments such as Granada, Managua, and León, where the use of machinery, especially on newly developed cotton plantations, had cut the demand for the existing labor force.  They also came from departments such as Rivas, Boaco, and Chontales, where the rapid growth of cattle-raising had lowered the demand for the rural labor force. In 1950, 76.2 percent of immigrants to Río San Juan had come from Rivas, Granada, and Chontales.

Cotton Cycle (1950-mid 1960s)

In the 1950s, there was a basic change in the agricultural structure of the country. Coffee, which was previously the basic export crop, lost its primary importance and was replaced by cotton. The reason for the decline of coffee's share in the exports, was a rapid growth of cotton exports, which had grown from 500,000 pounds in 1935 to 3,370,000 pounds in 1942. After 1950, cotton became king in the Nicaraguan economy. The land under cotton cultivation increased from 23,945 manzanas (15,000 hectares) in 1950, to 164,798 manzanas (115,000 hectares) in 1963.

The rapid allocation of land for commercial agriculture meant the displacement of subsistent farmers and traditional farming. Meanwhile the higher profits of export crops encouraged the landowners to shift the best and most accessible land toward this sector. Agricultural production for exports grew with an average annual rate of 7 percent in the 1950s. The share of the export sector in the total value of agricultural production increased from 39 percent in 1950 to 49 percent in 1962. The growth in the food production sector was much slower and lagged behind the population growth.

The slower growth rate of food production was due to the decreasing portion of cultivable land allocated to this sector. While the percentage of the land assigned to export products increased from 32.9 percent of the total in 1950 to 39.2 percent in 1962, the share of the land allocated to production for internal consumption declined from 67.1 percent of the total amount of available farm lands in 1950 to 60.8 percent of the total in 1962. The relative decline of the food-producing sector, with its traditionally high demand for labor, limited the ability of the agricultural sector to meet the occupational needs of an increasing population. Implementation of technology also benefited agricultural exports at the expense of the food producing sector and added to the rural unemployment.

Agricultural Technology and Credit

Modern techniques of production were widely used only in a few agricultural sectors, namely, cotton, sugar cane, bananas, tobacco, and, to a more limited degree, cattle. The Central Bank of Nicaragua estimated that in the agricultural year 1965-66 cotton production alone used 85 percent of the "mechanical potential" in agriculture and consumed 96 percent of all insecticides. In the same year, cotton, sugar cane, and banana production used over two-thirds of all fertilizers.

Government policies heavily favored the large producers in granting agricultural credits. For instance, in the 1960s, the government passed regulations to limit the granting of public credits only to cotton producers whose yield was more than 25 quintales per manzana. Considering the conditions of production in Nicaragua, this level of yield could only be achieved with the use of heavy machinery. Since the small and medium-sized producers could not use heavy machinery on their land, they could not produce the required yield for obtaining credit, and bank credits were automatically allocated to the large producers. This policy resulted in a further polarization of the rural population.

Another result of this policy was a relative decline in the share of the food-producing sector in the overall agricultural output. The majority of the small and medium-sized farmers who produced most of the food for internal consumption on marginal land were also marginal to the agricultural credit system. The food producers for the internal market were virtually pushed out of the agricultural credit line. On the other hand, the large cotton producers, with the help of the government, mechanized the production process to improve the yield and to cut the cost of production. In a short period, most of the cotton plantations in Nicaragua became totally mechanized, from soil preparation through cultivation. Only harvesting was not completely mechanized, as humans are needed to hand-pick the fiber.

Land and Labor Relations, 1950-1963

The rapid expansion of cotton production resulted in a massive land reallocation and a process of land transfer and concentration into the hands of cotton producers, especially in the Pacific zone.

More and more rural workers were now involved in wage-labor relations with their employers.

Another characteristic of rural employment in the second half of the twentieth century was the seasonal nature of agricultural jobs, which were available only during the harvest period. Heavy mechanization of the export sector had intensified the process of lowering the demand for a permanent labor force. According to some estimates, in 1962, between 63,000 and 120,000 seasonal laborers were used during the harvesting period on coffee, cotton, sesame, and sugar cane plantations.

The pace of capitalist development in Nicaragua was uneven in different regions and departments. For instance, the extension of capitalist relations was much higher in the Pacific region in the departments of Carazo, Estelí, Granada, and León, which were the centers of new export cash crops and the cattle raising industry. The percentage of wage laborers was also much higher in the Pacific region than the national average, and the percentage of the rural labor force involved in non-capitalist relations of production was much lower than thenational average.

On the other hand departments with vast agricultural frontiers, such as Zelaya, resisted the destruction of non-capitalist agricultural relations. In some cases, the non-capitalist labor force, which was expelled from capitalist regions, re-established traditional agricultural activities in these departments.

Patterns of land-tenure also demonstrate differences in productive systems. The private ownership of land which was very strong in the capitalist framework of commercial agriculture in the Pacific zone was a much weaker element in land-tenure patterns in the Atlantic zone.  Aa major part of the farm land in the Atlantic zone was used by subsistent farmers with no legal title to the land.

Migration, 1950-1963

The process of agricultural mechanization combined with a rapid conversion of large tracts of land to cotton plantations created a massive dislocation of the Nicaraguan peasantry, who joined the ranks of the rural proletariat, migrated to agricultural frontiers, or moved to the urban areas. The capitalist framework of the economy was the major reason behind the strong population repellent factor in the rural areas, especially in the Pacific zone.
 

The expansion of the cattle-raising industry intensified the migratory wave out of the rural areas. As the cattle-raising ranches took over large tracts of land, more and more landless peasants had to seek employment in other areas of the economy. The agricultural census indicates that in the agricultural year 1962-63, of a total of 5,461,162 manzanas of agricultural land, 46.4 percent (2,535,106 manzanas) was used as pasture, 27.4 percent (1,497,262 manzanas) as woods, and only 26.1 percent (1,428,794 manzanas) was used as crop land.

Most of the departments outside the Pacific zone which experienced a heavy loss of rural population, such as Boaco, Estelí, and Chontales, were involved in cattle-raising on a large scale. On the other hand, the departments attracting population were located in the regions with vast frontier land suitable for subsistent farming. This land hosted landless peasants driven out of other regions by expansion of commercial agriculture and cattle-raising.

Economic Change, 1960s

During the 1960s, agriculture was still the most important sector of the economy, with a major share in the Gross Domestic Product (GDP) and the exports of Nicaragua. However, the second half of the 1960s witnessed a drastic cut in cotton production, which resulted in a declining share of the agricultural sector in the gross domestic product and the labor market. The agricultural census of 1971, when compared with the 1963 census, shows a sharp decline in the number of agricultural jobs in all categories. For example, the number of agricultural employers (patrones) dropped by 6.6 percent, the number of wage laborers (empleados) fell by 20.2 percent, and the number of family workers (and workers without cash compensation) dropped by 15.1 percent.

These developments in the agricultural sector resulted in a sharp decline in its share of the nation's active labor force. In the 1960s, although the agricultural sector was still the most important employer in the national economy, its share in the economically active population dropped from 59.6 percent in 1963 to 46.9 percent in 1971.

The decline of the agricultural sector in the 1960s coincided with an expanding urban economy, especially the construction and service sectors, which increased job opportunities in the cities and attracted many unemployed agricultural workers to the urban centers Expansion of the industrial sector in the 1960s was another element affecting the process of urbanization in Nicaragua.

Similar to the earlier development of commercial agriculture, the modern industrial sector was also highly concentrated in the Pacific region. A 1960 Central Bank survey showed that three-fourths of the medium and large scale firms were located in this region; and CEPAL estimated that the firms in this zone accounted for approximately ninety percent of the value of total industrial production. Over three-fourths of the industrial establishments with five or more workers were located in this region. Especially pronounced was the concentration of industry in the department of Managua. The 1965 industrial census shows that nearly one of every eight industrial establishments (and nearly one of every three with five or more workers) were located in this department. The capital city of Managua was, and still is, the principal industrial center.

One of the characteristics of the Nicaraguan industrial sector is the proportionately high share of large industries in the total industrial output. CEPAL estimates that in 1962, firms with twenty or more workers constituted only 1.7 percent of all firms but produced over two-thirds of the industrial output.

However, the larger industrial establishments in Nicaragua tended to use capital intensive technology, and therefore, were unable to absorb large numbers of unemployed workers. This was the reason for the slow increase in industrial employment compared to the rapid increase in the share of the industrial sector in the total Gross Domestic Product. For example, although the share of the industrial sector in the GDP increased from 10.16 percent in 1950 to 19.44 percent in 1971, its share in absorbing the labor force increased from 11.43 percent of the total EAP in1950 to only 12.35 percent in 1971.

Industrialization in the framework of the Central American Common Market greatly promoted the growth of the commercial and service sectors. The share of the public sector in the economy also grew rapidly to facilitate theexpanding export economy.

These new economic trends had a major impact on the labor market. In the 1960s, the fastest growing sectors of the economy were the commercial, service, financial, and public administrative sectors, which increased their share of the labor force from 25.3 percent in 1963, to 36.7 percent in 1971. The expansion of these sectors, all concentrated in the cities, resulted in a rapid process of urbanization in Nicaragua.
 

Migration and Urbanization in the 1960s

The percentage of immigrants to total population in 1971 was 18 percent, compared to 11 percent in 1950, and 14 percent in 1963. The absolute numbers of immigrants were: 113,800 in 1950; 212,700 in 1963; and 341,100 in 1971.

In the 1960s, all departments of the Pacific zone were departments of rural population expulsion The majority of the migrants ended up in the Pacific zone cities, especially Managua.

The expulsion factor in the Pacific region was important because of the area's major role in agricultural production.  This region not only monopolized cotton production, but it was also important in the production of coffee, sugar cane, beef, and food products for internal consumption.

In contrast to the export sector, especially cotton production, basic food production was not using modern technology, and was labor intensive, especially in the production of corn and beans. It was only natural that the reallocation of land from food production to export cash-crops cut down the demand for agricultural labor, and intensified the expulsion factor in the rural areas of the Pacific zone.

The department of Managua was the final destination of many immigrants in the second half of the twentieth century. For instance, Managua attracted 43.8 percent of the total migration in 1950; 49.2 percent in 1962; and 49.5 percent in 1971. The population of Managua increased from 109,352 in 1950 to 274,296 in 1960 and 622,759 in 1977. The continuous process of immigration to Managua changed the character of the city. In 1950 only 25.0 percent of the population of Managua was non-native. This figure increased to 27.7 percent in 1963. In 1971, 30.5 percent of the population of Managua was born in other departments.

Lack of industrialization and job opportunities in cities such as Managua resulted in the marginalization of the newcomers. They moved into shanty towns on the outskirt of cities to begin the cycle of urban poverty which has continued to the present.

Conclusion

Historical analysis of migratory trends in Nicaragua before the 1979 revolution demonstrates that the process began with commercialization of agriculture and emphasis on cash crop production for exports. Development of low labor-intensive sectors, such as cotton and cattle production, intensified rural-to-urban migration in the 1950s and the 1960s. Government neglect of food producing sector, with its traditionally high demand for labor, and discriminatory credit policies added to the pressure on small and medium-sized farms and escalated the population movement towards cities.