In the rural areas of Guatemala, poverty is both widespread and deeply entrenched. A recent study by The World Bank found that 58 percent of the Guatemalan population live on incomes below the extreme poverty line, which is defined as the amount needed to purchase a basic basket of food.
A new solution to address poverty in Guatemala has emerged in the form of bracelets and necklaces. Entrepreneur Maria Pacheco is providing a sustained source of income to over 2,000 Guatemalans with these simple fashion accessories.
Growing up in Guatemala City, Pacheco was exposed to the poverty, devastation and desperation in her native country. Pacheco yearned to improve the quality of life in her homeland through organic and native farming, which “protects and gives life and is a sustainable way to produce food.” In Guatemala, agriculture accounts for a fifth of GDP and employs about 40 percent of the country’s total labor force.
But when Pacheco set out with her biological agriculture degree to help her native people, she found that the farmers’ parched and sloping hillsides were inarable and, more importantly, not profitable. This lack of income is not uncommon in rural areas of the country, as Guatemala’s income distribution is the most unequal in the world. While the wealthiest 10 percent of the population owns nearly 50 percent of the national wealth, the poorest 10 percent owns less than 1 percent.
“Poverty is a cycle that starts with an unequal distribution of income generated between the rural and urban areas of underdeveloped countries,” said Pacheco. In these weak rural economies, education is unattainable and people cannot provide even the basic necessities for their families.
Pacheco realized that the only way to break this poverty cycle was to bring commerce to the remote Guatemalans. With this in mind, Pacheco pioneered a commerce-driven program that primarily focuses on economically empowering the women residing in rural areas of Guatemala.
“Women are a very powerful force of change, if given the opportunities,” Pacheco said, adding that “most women will typically invest 80 to 90 percent of their income in improving their children’s nutrition, health and education.” Guatemala has one of the biggest gender gaps in the world and women have limited access to jobs and schooling.
The road to prosperity begins with training through Pacheco’s sister organization, Communities of the Earth, a business incubator that targets women throughout Guatemala and teaches them how to make bracelets and necklaces. These women collaborate in small groups called “value chains” which are comprised of more than 300 individuals to craft products. The products are then sent to Kiej de Los Bosques, Pacheco’s social company which bridges the gap between local weavers and artisans in rural communities and urban markets. The women receive a monthly stipend based upon the amount they produce per order, which provides a sustained income.
“With Queta Rodriquez, my business partner, we realized it was hard to sell products to just Guatemalan communities. So we decided to start an umbrella brand that would sell an assortment of handicraft products in international markets,” said Pacheco.
This “lifestyle” brand is known as Wakami and it is currently exporting to 20 countries, being produced in 17 villages, and generating income for 450 people. According to Pacheco, the fashion accessories of the Wakami brand are meant to inspire people to “be their dream,” enjoy life and share positivity with those around them.
Wakami also partners with other social businesses or NGOs that allow women to invest in services and products that will improve the lives of themselves and their families. These include water filters, improved stoves, latrines and organic gardens.
Pacheco has observed positive changes in the rural villages thus far. “Women are now valued in their families and contribute more to decisions and investments. Also, the average weight of children has improved from eight to 30 percent and high school attendance is more than double the national rate at 92 percent,” said Pacheco.
While much progress has been made, Pacheco feels as though “this is just the beginning.” She plans to begin selling other products through the Wakami brand such as bags and scarves, and also wants to include people in rural villages from other areas of the world in the value chains.
When asked what she would ultimately like to achieve through her efforts to generate economic change, Pacheco simply said “transformation.” And, in many rural villages of Guatemala, the first steps toward transformation have already been taken.