Coca in Bolivia: Participatory development and aid conditionality in the Chapare

This is a comparative study of United States Agency for International Development (USAID) and European Union (EU) development interventions in the Tropics of Cochabamba (TC) region of Bolivia. In this study, I focus on two development programs, USAID's "Actividad Rural Competitiva" (ARCo) and the EU's "Fondo Nacional de Desarollo Alternativo" (FONADAL). Each of the programs is attempting to reduce economic dependence on coca cultivation by alleviating regional poverty. ARCo and FONADAL are similar in structure to conditional cash transfer programs (CCTs), whereby funding is transferred directly to beneficiaries for specified activities or purposes designed to reduce the incidence of poverty. This study's objective is to determine whether ARCo or FONADAL is a more effective program. I evaluate program effectiveness or the policy success of ARCo and FONADAL according to each program's ability to garner support from local Bolivian stakeholders. I argue that while the USAID approach to alternative development in the TC, primarily through ARCo, has resulted in increased economic productivity in licit alternatives over the short term, the community-focused approach of the EU through FONADAL has been far more effective than its American counterpart in securing the support of local Bolivian stakeholders. Data for this study was collected through a series of interviews conducted with stakeholders in La Paz, Bolivia and the TC from August to October 2007. Based on nineteen interviews conducted for this study, I argue that stakeholders in the TC are more supportive of poverty interventions that are community focused and unconditional.