(providing for universal incentives, tax reform); (3) free up imports (unilateral lowering of tariffs, free trade agreements); (4) privatize state enterprises and services (electricity, communications and ports); (5) deregulate the domestic market (freeing up the price system and eliminating subsidies); and (6) reform the state and introduce labor flexibility (reforms to the labor code and creating special regimes for
foreign investment).
     From an economic and commercial perspective, the United States, Canada and some Latin American governments gave impetus to the creation of the Free Trade Area of the Americas (FTAA) and subregional or bilateral variations of it. The FTAA is the regional expression of neoliberal globalization that is trying to become established through a process of asymmetric integration and under the leadership of the transnational companies. This asymmetric integration seeks to reorganize the economic factors and natural resources of Latin America and the Caribbean in keeping with the interests of U.S. corporate capital. The promoters of these free trade agreements argue that foreign investment will lead to economic development benefiting all, but these treaties, thus far, have had mixed effects (Gratius and Stiftung, 2002; Lederman et al., 2003; Gallagher, 2004). NAFTA, the free trade agreement among the United States, Canada and Mexico, exemplifies the mixed effects of these treaties. For example, a study by the World Bank concluded that due to NAFTA Mexico has come closer to the levels of development of the United States and Canada (Lederman et al., 2003). The study estimates that without NAFTA, the levels of exports and foreign investment would have been 25% and 40% (respectively) less than what was obtained with NAFTA. On the other hand, another study concludes
that the environmental cost of economic growth in Mexico in the years in which NAFTA has been in force have been 10% of annual GDP, or US$50 billion annually in damages (Gallagher, 2004). In addition, it is argued that under NAFTA the government of Mexico has lost the capacity to protect the environment and human rights and that its citizens are losing the right to participate democratically in determining the course and priorities of their development (Gratius and Stiftung, 2002).

      Following the neoliberal guidelines, IICA and other multilateral regional organizations in the Latin American countries are implementing the New Rurality approach, with three main components: competitiveness of agriculture and rural production, equity in the rural sector and the creation of a new institutional framework (IICA, 2000). The
objectives of the new rurality are geared toward (1) improving and deepening the country involvment in international markets; (2) improving technically and professionalizing crop, livestock and forestry production and agribusiness development; (3) improving the capacity of the public sector to support sectoral development; (4) inducing gradually and with supervision the transfer of public services to the private sector.

      The approach appears to take up anew some of the same guidelines of the previous models, with similar results. The recent data on economic growth and inequality in LAC in the first years of the millennium confirm this. Indeed, real per capita growth rates in the first four years of the millennium (2000-2004) were 2.1%, -1.1%, -2.1% and 0.5%, far

below the averages attained in the 1960s and 1970s (CEPAL, 2004b) and economic inequality in the region continues to be the highest in the world (Ferranti et al., 2004).
     In summary, the development models that have guided the economic policies and, therefore, agrarian policies, in LAC after the Second World War have answered mainly to the needs of the principal world power, the United States. With respect to agriculture and the development models, the role of the state is changing from producer and supervisor to organizer and facilitator of the development processes in the agricultural sector. Second, the multinational companies are already leading the process of technological development, especially in the area of biotechnology and consulting firms and NGOs are quickly filling the spaces being abandoned by the state in different technical, environmental and social areas. Finally, the privatization of utilities and resources associated with ecological services (such as water) distributes conservation costs locally among many, while the benefits are reaped by just a few, who generally are not part of the rural communities.
1.5.2 Social context

1.5.2.1 General situation of poverty in Latin America and
the Caribbean
For the purposes of this evaluation, poverty is defined as a permanent condition of economic, social, political, health and environmental vulnerability stemming from asymmetrical property, trade and power relations, with reference to specific historical contexts and conditions that are ultimately determined by the economic relations of production
and the development of the productive forces. Poverty is expressed in the lack or scarcity of goods and services (such as food, housing, education, health care, drinking water), resources (productive resources, employment, income) and sociopolitical conditions (human rights, economic, social and cultural rights, political rights) essential for meeting the basic needs that contribute to the loss or deterioration of the standard of living and quality of life resulting from the difficulty accessing, controlling and managing productive and natural resources.

      There are two types of poverty in the region, structural and transitory. Structural poverty (or “hard poverty”) affects mainly indigenous communities, rural women and ethnic minorities. The people affected by this type of poverty generally have little if any education, scant productive resources if any, limited productive knowledge and few technical skills and lack access to basic services. Transitory poverty affects peasant families and rural households that have limited or no access to land and which are especially vulnerable to the changes ushered in by the structural reforms, fluctuations in the economic cycle and social and political instability. Crises or sudden changes in economic policies have a detrimental impact on both agricultural and non-agricultural incomes, causing periodic declines in such incomes and deterioration in living conditions.
     In 2005, Latin America and the Caribbean had a total population of 569 million people, 77.6% of whom are urban and 22.4% rural (CEPAL, 2006ab). At the same time, the region has a population of 209 million poor persons, 81 million of whom are living in extreme poverty (CEPAL,