Nicaragua Network

1. Petrocaribe summit in Managua lays out plan for economic zone
2. Seniors negotiate agreement with government
3. Environmentalists differ on impact of canal; other canal-related news
4. FIDEG study shows continued slow reduction in poverty
5. Garment factories and unions optimistic
6. Nicaragua sends wishes to South Africa for Mandela
7. US company to dig exploratory oil well off Caribbean Coast
8. 235,000 acres of land reforested since 2007
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1. Petrocaribe summit in Managua lays out plan for economic zone

The leaders of the member countries of Petrocaribe met in Managua on July 29 and agreed to study the formation of a Petrocaribe economic zone that would move beyond the original energy focus of the group and have as its focus transportation, communications, tourism, trade, social and cultural initiatives, and the formation of what the leaders called “production chains.”  As laid out by Venezuelan President Nicolas Maduro, the social programs would focus on three goals as part of an effort to establish a poverty free zone: the eradication of illiteracy, the setting up of Operation Miracle eye surgery programs in each country, and achieving freedom from hunger by means of a food program.  In the final declaration read by President Daniel Ortega, host of the gathering, the leaders agreed to instruct their economic and trade ministers to meet as soon as possible to put in place mechanisms to evaluate cross-country productive associations with the goal of consolidating regional economic independence.

The meeting was attended by presidents, prime-ministers and other leaders from the 18 members of Petrocaribe plus three observer countries--Bolivia and Ecuador, both members of the Bolivarian Alliance for the Peoples of Our Americas (ALBA), and El Salvador. The 18 Petrocaribe members are: Antigua and Barbuda, Bahamas, Belize, Cuba, Dominica, Dominican Republic, Grenada, Guatemala, Guyana, Haiti, Honduras, Jamaica, Nicaragua, Saint Kitts and Nevis, Saint Vincent and the Grenadines, Saint Lucia, Surinam, and Venezuela.  Petrocaribe was founded in 2005 by the late President of Venezuela Hugo Chavez to provide petroleum to member countries with favorable payment plans that included low interest rates and the possibility of repayment in products needed by Venezuela.  Nicaragua’s exports of sugar, beef, cooking oil, milk, beans and other products to Venezuela so far this year have totaled US$206 million up from US$173.9 million during the same period last year.

Rafael Ramirez, president of Petrocaribe, said that money from the sale of petroleum has made possible the funding of 88 social projects in 13 countries, especially in the area of food production.  He explained that a system of petroleum transport, storage, and refineries has been built by Petrocaribe including refineries in Cuba, the Dominican Republic and Jamaica.  He said that other refineries were scheduled to be built or were under construction in Cuba, Nicaragua, and Venezuela.  The refinery in Nicaragua to which Ramirez referred is known as The Supreme Dream of Bolivar and is projected to be completed in 2017.  However, currently construction is proceeding only on under-ocean pipelines and storage tanks.

La Prensa quoted opposition National Assembly Deputy Adolfo Martinez Cole, vice-chair of the Foreign Affairs Committee, as saying, “Venezuela is not in a position to move this forward and Nicaragua even less. It is never going to function.  They are just interested in the appearance of development.”  But, economist Francisco Mayorga told Channel 4 news that, “The refinery is advancing at its own rhythm,” adding that the first phase is the storage tanks with the refinery coming later.  (El Nuevo Diario, June 30; Radio La Primerisima, June 30, July 1; La Prensa, June 29, July 1; Informe Pastran, July 1)

2. Seniors negotiate agreement with government

Last week leaders of the National Union of Older Adults (UNAM) and government officials met and agreed to a series of measures to address the demands of the seniors for a small Social Security pension which had led them to occupy the Managua office of the Social Security Institute (INSS) the previous week. The issue became a rallying call for the political opposition and opposition parties and groups called youth to the building to support the seniors. There were violent clashes between opposition and Sandinista youth before the seniors finally left the building.  At a government sponsored march and rally on June 24, UNAM leader Porfirio Garcia said that he was ready to begin talks with the government.  The parties agreed on a regular schedule of meetings and that the seniors, who did not pay into social security long enough to be eligible for a pension, will now be able to assign another person to pick up their monthly ALBA-funded stipend for them if they are not mobile; that problems in receiving the stipends in local banks will be resolved; that eye exams and glasses will be provided to the 8,000 registered seniors along with wheel chairs and canes; and that UNAM will have a social worker in INSS offices around the country to address concerns.

Meanwhile, lawyers representing 14 young people who said that they were victims of Sandinista mob violence on June 22 at the INSS headquarters entered a complaint at the prosecutor’s office in Managua.  Gonzalo Carrion, legal director for the Nicaraguan Center for Human Rights (CENIDH), said, “Here there is direct responsibility of institutions of the [Sandinista] party and of the government,” adding that there was complicity either by commission or omission on the part of the National Police.  In a statement, the Police said that there had been an attempt to delegitimize the police with the use on social media of images of incidents that “did not occur in our country and that were not carried out by our agents.” The statement said that the mission of the Police had been to preserve order and security for all Nicaraguans.

In another related incident, Carlos Ariñez, husband of Zoilamerica Narvaez Murillo, was deported on June 25 in what Narvaez said was retaliation for having participated in opposition rallies in support of the seniors with the Center for International Studies, which Narvaez directs.  Narvaez Murillo is the daughter of government communications coordinator and First Lady Rosario Murillo and step-daughter of President Daniel Ortega.  There were different versions of whether Ariñez, who is a citizen of Bolivia, had his residency up-to-date or if it had recently expired.  [In some Latin American countries, foreigners are prohibited from participating in political activities but these laws are usually only sporadically enforced.] (La Prensa, June 26, 28; Informe Pastran, June 25, 27; Radio La Primerisima, June 25, 26)

3. Environmentalists differ on impact of canal and other canal-related news

El Nuevo Diario carried two important interviews in the past week with environmentalists who expressed differing views on the impact the inter-oceanic canal across Nicaragua could have on the nation’s ecology, especially on Lake Cocibolca (Lake Nicaragua).  Salvador Montenegro Guillen of the Center for Research on Aquatic Resources at the National Autonomous University of Nicaragua (CIRA-UNAN) said that, while at the moment only a few towns get their water from Lake Cocibolca, many more could do so “and if there were to occur an oil spill, even a small one, it would be the end of hopes for supplying national needs and for the export of water to neighboring countries.  A very small spill, say 5,000 barrels, could take more than 20 years to eliminate, given the conditions in Cocibolca, and would be sufficient to cause the suspension of consumption of water from the lake for drinking and for irrigation.”  Montenegro said that there are several other options for a canal route that would not use the lake.  “A route excavated completely on land could connect the two ports and industrial cities that are planned,” he insisted.  In the interview he did not describe the possible routes.

Jorge Jenkins Molieri, the first head of what later became the Ministry of the Environment and Natural Resources (MARENA), agrees on the importance of protecting Nicaragua’s water resources for irrigation and human consumption but he believes that the Lake can successfully be used as part of the canal.  He said that water from the vast watershed that drains into the Lake would be held in reservoirs for use to maintain the necessary water levels for the passage of ships through the canal.  It would be from those reservoirs that water would be taken for drinking and for crop irrigation.   He said that for the first time the funding would be available for investment in the restoration of forests destroyed by timber companies and farmers clearing land for agriculture.  He stated, “If you don’t protect the environment and the natural resources there will not be enough water and without water there is no canal.”  On the subject of the ethnic communities of the Caribbean region, Jenkins said that there would be communities that wanted to participate and gain benefits from the project while others would prefer to conserve their traditional lifestyles.  “I believe that the latter should be respected” and the indigenous communities should all be compensated for the use of their territories, he concluded

Meanwhile, over 100 opposition political figures, intellectuals, journalists, philosophers and others issued a public declaration which declared the canal concession to be “a sellout with illusions of riches and progress, done with obscure manipulations, to achieve ambitions of power and the reaffirmation of strongman government and, what is worse, the surrendering of our nation’s sovereignty.”  The 50 year concession, extendable for another 50 years, along with the lack of consultation with the whole population combined with expected environmental damage led the signers to demand the immediate cancellation of the agreement.  Among the signers were many former Sandinistas, now members of the Sandinista Renovation Movement and the Sandinista Rescue Movement. 

In related news, the only Sandinista National Assembly deputy who did not vote for the canal was removed from her post last week with a letter from the Supreme Electoral Council (CSE).  Xochilt Ocampo said that she did not know why she was removed because no one had given her any explanation.  National Assembly President Rene Nuñez and Sandinista bench head Edwin Castro said that it had been a decision of the CSE.  (El Nuevo Diario, June 25, 27, July 1; Informe Pastran, June 26, 28; La Prensa, June 26)

4. FIDEG study shows continued slow reduction in poverty

On June 25, the International Foundation on the Global Economic Challenge (FIDEG) released the results of its survey of general and extreme poverty in Nicaragua for the year 2012.  The survey, which polls the same households each year, found that general poverty (individuals living on less than US$2 per day) had declined from 44.1% in 2011 to 42.7% in 2012 while extreme poverty (individuals living on less than US$1 per day) declined from 8.2% in 2011 to 7.6% in 2012.  General poverty declined in both rural and urban areas and extreme poverty declined in urban areas.  However, it rose in rural areas this year.  FIDEG president Alejandro Martinez Cuenca explained saying, “The reduction in prices on the world market caused a decline in [rural] consumption capacity and although this was compensated somewhat by remittances and government programs, they were not sufficient to reduce extreme poverty in the rural areas.”  He added that while the results of this fourth annual survey showed an overall reduction in poverty, “much greater effort is required for the country to continue reducing this scourge.”

The 1,730 households surveyed are divided between 874 urban families and 856 in rural areas. The survey has a confidence level of 95% and a margin of error of 2.4%.  It is financed by the World Bank and the governments of Finland and Canada.

On June 26, Martinez Cuenca said that La Prensa had misinterpreted the survey results by highlighting that the decline in poverty was within the margin of error of the survey.  “The important thing,” he said, “is to show the tendency and that [decline] is the tendency and I would like for those of you who have influence on the national atmosphere to contribute to seeing this as a success.”  (El Nuevo Diario, June 25; La Prensa, June 26; Informe Pastran, June 25; Radio La Primerisima, June 25)

5. Garment factories and unions optimistic

Despite a 5% decrease in sales, the Nicaraguan textile industry is optimistic that it will maintain exports at a level similar to 2012’s US$1.389 billion. Dean Garcia, executive director of the Nicaraguan Textile and Tailoring Industry Association (ANITEC), said that despite the lower orders, the volume shipped is increasing. He identified the reduced demand as due to the financial crisis in Europe. Labor leader Pedro Ortega stated that labor stability in the Free Trade Zone factories reduced impediments to the US market and that he noted that some factories have hired additional people in recent months. A US company, New Holland Apparel, which makes sports clothes, recently signed an unprecedented collective bargaining agreement with several unions which includes pre and post natal care, paid maternity leave, a union office, a health clinic, day care center, guaranteed free labor organizing, productivity incentives and other benefits. Miguel Ruiz of the Jose Benito Escobar Workers Central said that the agreement covers 2,500 workers. (El Nuevo Diario, June 26; La Prensa, June 26)

6. Nicaragua sends wishes to South Africa for Mandela

The Nicaraguan government expressed solidarity with the people of South Africa and wishes for the recovery of former President Nelson Mandela. Coordinator of the Council of Communication and Citizenship, Rosario Murillo, said that the government’s message expressed “a solidarity embrace and a message of profound love...for the recovery of your historic leader, the father of the nation, Nelson Mandela, historic leader of the people's liberation struggle, the struggle of African people throughout the world.” She added that President Daniel Ortega had had the opportunity of meeting Mandela some years ago in Havana, Cuba. (Radio La Primerisima, June 26; La Prensa, June 26)

7. US company to dig exploratory oil well off Caribbean Coast

The US oil company Noble Energy, which was granted a concession in 2009, will begin drilling its first deep water exploratory well in the Caribbean coastal waters of Nicaragua in August. The 3,000 meter well should be completed by the end of the year. Minister of Energy and Mines Emilio Rappaccioli, stated that the Nicaraguan government has confidence that the company, which expects to invest US$300 million in exploration in Nicaraguan waters, will have success. Under Nicaraguan law, the company will pay Nicaragua 15% of the gross production and a 3% tax to near-by municipalities for social projects. If the company finds sufficient oil or natural gas to be commercially viable, it will pay a 30% tax. Rappaccioli said that, if the existence of oil is confirmed, it is estimated that over 25 years the company could produce 500 million barrels for which it would pay the government US$17.5 billion. (Radio La Primerisima, June 25)

8. 235,000 acres of land reforested since 2007

Since taking office in 2007, the government of President Daniel Ortega has reforested 235,000 acres of forest with a national campaign including 300,000 youth, members of the army and police, municipal employees and logging companies. According to William Schwartz, executive director of the National Forestry Institute (INAFOR), “This year we are planning to reforest 37,000 acres minimum.” He made the statement at the First Forestry Fair, titled “More forest, more life.”

Some logging companies are unhappy with the new regulation that they must plant 10 saplings for every tree harvested, according to Schwartz, and have filed a legal complaint against INAFOR. Other companies, he said, are accepting the requirement since the reforestation effort includes mahogany and other commercially valued hardwoods which will insure timber into the future. Several types of fruit trees are also included. Eleven million trees are to be planted by December 2013. (El Nuevo Diario, July 1; La Prensa, June 28)