The Politics of Agricultural Reform
Omar Torrijos himself was well known among peasant leaders for having killed students who led peasant guerrilla struggles in Cerro Tute in 1959. Torrijos obviously wanted to include, the peasantry in the populist alliance, to bring them into politics for the first time. The Agricultural Development Bank (BDA) and the regime that created it wished to get capital in the hands of peasant settlers and so increase agricultural output, diminish poverty, and strengthen the political bonds between Torrijos and the poor peasant. The middle- and large-scale farmers felt that they had been short-changed by the agricultural reform. The regime sought to fill the gap by creating its own mechanism for capital accumulation--the BDA. Prior to 1973 the main sources of agricultural credit were private banks, usually foreign-owned; private merchants; the National Bank of Panama; and the Institute of Economic Promotion. The initial idea for peasant settlements was developed by the Interamerican Institute of Agricultural Sciences.