El Niño and the Finances of Agricultural MSEs: Why Drought Does Not Affect Them All Equally

The article examines the differentiated effects of El Niño and drought on agricultural micro and small enterprises in El Salvador. It notes that there are approximately 59,558 agricultural MSEs, representing nearly 7% of the total MSE sector, and that 87.1% of their owners depend on these businesses as their main source of income. It distinguishes between accumulation-oriented enterprises, which can invest in reservoirs, technical assistance, irrigation improvements and production planning, and subsistence enterprises, which lack the financial margin to implement adaptation measures. It also explains how lower agricultural production affects suppliers, prices, inventories, small agro-industries and other businesses. The analysis calls for differentiated responses combining appropriate credit, water-management infrastructure, technical assistance, climate information and social protection.