Resource information
This regional study encompasses three
Central American countries: Nicaragua, Guatemala, and
Honduras. The focus of this report is Nicaragua. The
objective of the study is to understand how broad-based
economic growth can be stimulated, and sustained in rural
Central America. The study identifies "drivers" of
sustainable rural growth and poverty reduction, where
drivers are defined as the assets and combinations of assets
needed by different types of households in different
geographical areas to take advantage of economic
opportunities, and improve their well-being over time. The
study examines the relative contributions of these assets,
and identifies the combinations of productive, social, and
location-specific assets that matter most to raise incomes,
and take advantage of prospects for poverty-reducing growth.
The study's focus on assets is appropriate given
historically stark inequalities in the distribution of
productive assets among households in the region. Such
inequalities are likely to constrain how the poor share in
the benefits of growth, even under appropriate policy
regimes. In Nicaragua, economic potential has a strong
spatial pattern, with high potential areas close to the main
cities. But to generate substantial gains in poverty
reduction and broad-based growth, complementarities between
productive, social, and location-specific assets must be
addressed. The report thus recommends the move from
geographically untargeted investments in single assets, to a
more integrated and geographically based approach of asset
enhancement with proper complementarities. And, if the
development objective is to reach the largest number of
poor, invest in a variety of social and productive household
assets, in higher potential areas with the highest rural
poverty densities. However, remote areas such as the
Atlantic, need specialized analyses and differentiated
strategies and investments. The report highlights the need
for more strategic convergence in linking the investment,
and impacts of sectoral projects backed by the Bank, and
other donors in the diverse geographical regions of the country.
