Sustainability in the Diffusion of Innovations: Smallholder Nontraditional Agro‐Exports in Guatemala

I. Nontraditional Agro-Exports in Guatemala Since the late 1970s, Guatemala, like a number of other developing countries, has experienced an extraordinarily rapid growth in the production of nontraditional agro-exports (NTXs). The share of agricultural exports coming from NTXs grew from less than 6% in 1980 to more than 22% in 1992. Rationales behind the promotion of NTXs by governments and development agencies include seeking foreign exchange earnings, alternatives to depressed market conditions for traditional export crops, and rural poverty reduction. As part of the packages mandated by structural adjustment and trade liberalization programs, many national governments, including Guatemala’s, introduced policies in favor of NTX producers, such as export facilitation procedures, subsidy programs, and fiscal reforms. Trade agreements such as the Generalized System of Preferences and the Caribbean Basin Initiative created additional incentives for NTX exporters. In the Guatemalan context, private organizations and trade associations, such as the Association of Exporters of Nontraditional Products, played a catalytic role in promoting NTXs in the 1980s. As a potential new approach to rural development, international donors have invested heavily in the promotion of NTXs among smallholders. One such effort that received considerable attention is the agricultural cooperative Cuatro Pinos that was founded in 1979 with financial assistance from a Swiss development agency. Cooperative membership grew tenfold in the following 10 years, reaching more than 1,900 members in the late 1980s and operating in ten different villages. Pre-NTX agriculture in the region was dominated by the milpa sys-