Nepali Times Asian Paints
Strictly Business
Central American lessons


The murder of Archbishop Oscar Romero exactly 25 years ago this week lit the fuse of El Salvador's civil war. Throughout the 1980s, despite national and international attempts, talks between the Salvadoran government and the rebels broke down repeatedly. With a death toll standing at around 75,000, both sides finally reached a negotiated peace settlement in 1992. Since then, political inclusion and electoral competition-both foundations of democracy-have come to mark Salvadoran politics.

Indeed, El Salvador with a population one-fourth of Nepal remains an intriguing country to study. Fifty years of family rule followed by another 50 years of military rule only to be followed by a civil war appear to have resulted in a genuine multiparty representative democracy.

How did the Salvadoran peace settlement come about? Coffee exports long made about a dozen families in El Salvador rich enough to own much of the land. With money to spare, these oligarchs diversified business holdings to include banking, cotton and sugar. Meanwhile, increasing landlessness, joblessness and poverty caused thousands of ordinary Salvadorans to be a ready audience to various leftist insurgent groups that espoused the cause of social justice, took protests to the street and bore the brunt of state brutality. These groups eventually coalesced to form Frente Farabundo Marti para la Liberacion Nacional (FMLN).

Fearing that an armed conflict between the rich and the poor was imminent, reform-minded military officers took control of the government in 1980. Their first act was to nationalise banks and foreign trade mechanisms, and re-distribute land. But these measures further antagonised the elite, who responded by forming their own political party called National Republican Alliance Party (ARENA) in 1981. By the mid-1980s, a triangle made up of conservative ARENA, the military-managed government and the leftist FMLN was in place in Salvadoran politics. Assassinations of political dissidents and widespread killings continued apace-leading to gross human rights violations and reduced military funding from the US.

In 1985, Alfredo Cristiani, a coffee trader, became the moderate head of ARENA. He saw he could not count on the military rulers to be an ally. He sought to broaden his party's base to include small-business owners who brought varied concerns. They agreed that FMLN could not be wiped out militarily and that a peace settlement was necessary. When Cristiani was elected the president of El Salvador in 1989, he set the stage to initiate the peace process, despite several attempts on his life. The United Nations acted as a mediator for several rounds of talks, which led to compromises by both sides-resulting in a declaration of peace in January 1992. In the 1994 national elections, the former FMLN rebels, who had by then solidified as legitimate political actors, won a respectable 25 percent of votes.

Some scholars such as Elisabeth Wood of New York University argue that 'democracy was forged from below in El Salvador via two processes': first, the insurgency created its own counter-elite, composed of moderates who gained influence as the state's military bluster waned. Second, the elite running the country had diversified business interests and was not limited to the export of coffee alone.

Once both sets of elites came to see what lay underneath their class-based opposition intersected at certain points (including matters related to nationalism), they came to accept a negotiated peace settlement as a way out of the conflict. As a result, it was the businessmen, playing by the rules of electoral politics and engaging in skilful negotiations, who brought in rebels into the political mainstream in El Salvador.

(11 JAN 2013 - 17 JAN 2013)