BUSINESSWEEK ONLINE : MAY 1, 2000 ISSUE
INTERNATIONAL -- LATIN AMERICAN COVER STORY Mexico: A Powerful Incentive to Keep Kids in School (int'l edition) For Agustina Martinez, mother of four, a check from the Mexican government is the main reason her sons are still in school. If it weren't for the $75 she gets every month from an innovative program called Progresa, her eldest, age 13, would already have dropped out to work in the fields of San Juan de las Manzanas, a village north of Mexico City. Martinez' husband, blind in one eye, has trouble finding work, and she herself makes just $3 a day when there is work on neighbors' tomato farms. But her eldest boy now has a shot at a better life. ''Maybe he'll finish high school,'' says the 35-year-old mother. And then land a decent paying job at a factory, perhaps? ''God willing,'' says Martinez, smiling at the thought. Millions of impoverished Latin Americans could win better jobs and rise out of poverty thanks to educational subsidies being tried by Mexico, Honduras, and Brazil. The premise is simple: pay parents to keep their kids in school. The payments make it possible for peasant families to abandon the age-old tradition of putting their children to work at an early age. Since it was launched three years ago, Progresa has swelled into a $1 billion-a-year program that provides scholarships, nutritional supplements, and cash food payments averaging a total of $30 a month to 2.6 million Mexican families. Scholarships for girls are slightly higher than those for boys, to combat their higher dropout rate. It's not just a giveaway program: Children are required to attend school regularly and get routine, free medical checkups. And mothers must attend seminars on hygiene and nutrition. At the high school in San Juan de las Manzanas, enrollment has doubled, to 140 students, thanks to Progresa, says the school's director, Lourdes Morales. Attendance is also up. ''Before, if a student got sick, he'd stay home for several weeks,'' Morales says. ''Now, the mother immediately takes him to the doctor and he only misses one or two days.'' That's because if a student misses more than 15% of classes, the family's Progresa payments are suspended. President Ernesto Zedillo has relied on programs like Progresa to replace costly universal subsidies on such things as tortillas and milk, which benefited the general population more than they did the poor. The World Bank and the Inter-American Development Bank praise Progresa for its success in reaching the most marginalized. One-third of the program's beneficiaries are Indians. POLITICAL TOOL? But Progresa also has its detractors. Critics say it should be expanded to cover all of the estimated 50 million Mexicans living below the poverty line. That would require significantly more funds, which are hard to come by in these days of tight budgets. It would also take a government commitment to keep Progresa going past this presidential term, something that rarely happens in Mexico, where each president tries to make his mark with a distinctive social program of his own. Others see Progresa as merely a political tool for the long-ruling Institutional Revolutionary Party (PRI). At San Juan de Las Manzanas, mothers who receive Progresa funds are regularly shuttled off in buses to attend PRI rallies in nearby Ixtlahuaca. There are also concerns that Progresa could create a welfare mentality among the poor. Indeed, some of San Juan's women say their husbands stopped working when the cash payments started rolling in. But for Agustina Martinez, whose 13-year-old son is in seventh grade, Progresa may make it possible for him to be the first in the family to finish high school. ''It will only happen if this program continues,'' she says bluntly. ''If Progresa ends, he'll have to go to work.'' And, quite likely, continue the cycle of poverty for his own children. By Geri Smith in San Juan de las Manzanas _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS The Fight against Latin Poverty (int'l edition) LATIN AMERICA COVER IMAGE: The Fight against Poverty CHART: The Intractable Problem TABLE: Promising New Approaches to Reducing Poverty Mexico: A Powerful Incentive to Keep Kids in School (int'l edition) Peru: Fixing the World, One Roof at a Time (int'l edition) Brazil: Small Investments That Make a Big Difference (int'l edition) ONLINE ORIGINAL: Chile: Turning Street People into Businesspeople INTERACT E-Mail to Business Week Online

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