Confidencial

Swiss Fruit Industry Project in Nicaragua Invaded

Passion Fruit cultivation on the demonstration farm taken over by armed men.

Until last March, the Chinandega Maracuya Company (Chimaco) Project was the crown jewel of PRONicaragua, the government’s investment promotion agency, which chose it as “project of the year”; and as such, presented them to the International Global Investment Award Contest, in Dubai, where they won second place.

A few months later, this $19 million-dollar investment project destined to plant 1,200 hectares of maracuya (passion fruit) and provide employment to 1,500 workers, became the object of a revenge mechanism against the private sector, because of its support to the April Rebellion.

“This is a deliberate act of harassment and settling of scores with the private sector. It is a low blow that doesn’t contribute to the search for a political solution,” stated Mario Arana, General Manager of the Association of Producers and Exporters of Nicaragua (APEN).

The invasion of the farm occurred on July 28, when various pickup trucks full of armed men arrived at the property and occupied 19.7 hectares that Chimaco rents from the Coen Group to develop the plantation, and another 21.3 hectares —also belonging to the Coen Group—that were not included in the rental agreement.

“This project is 99 percent foreign investment,” explained Juan Fernando Ramirez, legal representative of Chimaco, detailing that the total investment amounts to 19 million dollars to be disbursed over five years. The project aims to create 150 jobs just in the factory and 1,500 in total in the first phase.

Up until the armed trespassers took the land, activities were focused on developing a demonstration farm that could be used as a school for farmers interested in this crop, with the intention of building a processing plant to produce passion fruit and banana puree concentrate.

“The demonstration farm works with new, sustainable and environmentally friendly technology. We were already beginning to harvest, because the plants were bearing their first fruits”, revealed Ramirez.

The next step included expanding the cultivation areas to reach 1,200 hectares, of which 80% would be owned by private farmers (200 small and 40 medium size). At the same time, machinery would be installed to produce juice and concentrate of various fruits.

This company representative explained that we are dealing with Italian technology with European components, “the best in the industrial field of juices” that was already purchased “and is on the way”.

The Coen Group will be planting its own areas, but both they and Chimaco will be partners in the plant, that will operate under the label of Frutco of the Americas, a subsidiary of the Swiss Frutco AG.

There are three farms invaded

After the initial shock, the decision of the owners was to file a formal complaint with the National Police. Letters were also sent to PRONicaragua “who knows the project well, in order to push the eviction, but we have no response from them,” stated the legal representative of Chimaco.

After disarming the security guards of Chinamo and the Coen Group, the invaders dug trenches to hinder any possible intervention by police forces. They are also reaping the harvest that does not belong to them, without discarding the possibility of other damages they may be doing. This could only be confirmed by the owners, once they recover their property, because at present it is too dangerous to get close the area.

The claim also includes the Holanda and Apastepe farms. The first is a farm of 281 hectares used mainly to grow sugarcane, a crop that has not been watered or cut since the day of the incursion.

“They have also stolen and sold parts, irrigation systems and agrochemicals that we had in the warehouses. Tractors have been used to destroy crops and damage infrastructure,” explained Carlos Zuniga, Legal and Operations Directors of the Coen Group.

Apastepe, on the other hand, is a 240 hectare farm with a forest of precious woods and avocado crops, from where “they have stolen and sold the avocado production,” he added.

Ramirez revealed that although he communicated the facts to the relevant authorities, he has not tried to speak or mediate with the intruders “because they are armed. And, actually, because in I have nothing to negotiate with them,” he noted.

Asked more about it, he stated that he only knows that “PRONicaragua is taking action on the matter to find out what is happening,” and expressed confidence that the mediation of the Swiss representation in the country will be useful to get the property vacated.

Mario Arana, Director of APEN, said that Chinamo is “a project for which we had an assistance program. We were providing support to achieve certifications demanded by the European market,” probably referring to FSSC 22,000; SGS; Kosher; Halal; no GMO; and the approval of the US Food and Drug Administration (FDA).

The economist explained that the project was important for the transformation of the productive strategy and export diversification of the country, by including concentrate, puree and juices, as new regional and international export products.

“This sends a terrible message to investors,” said Arana, explaining that many entrepreneurs committed to the agro-industrial processing of cocoa, passion fruit and pineapple were interested in expanding their crops. “But land seizure is a totally negative decision and is counterproductive because now investments are paralyzed and could be suspended,” he warned.

Arana cited one more risk, resulting from the fact that “this is a Swiss investment, a country that has cooperated for decades with Nicaragua and continues to do so until today,” which is why he recommends acting in a reciprocal way with this Swiss investor.

The Swiss investors and their Nicaraguan counterpart the Coen Group, expect the efforts made with the Police, government, diplomatic and private sector authorities will be successful, so they can recover the properties seized by the armed groups.