TUESDAY, DECEMBER 02, 2008

Nicaragua Hotline (December 2, 2008)

1. Violence ends and opposition fails to annul elections
2. US suspends Millennium Challenge money and Europe slows aid
3. Women march against violence, but divided; Oxfam-GB cleared of charges
4. Nicaragua's economy has both good and bad news

Topic 1: Violence ends and opposition fails to annul elections

Calm returned to the streets in Nicaragua last week after two weeks of sporadic violence that injured several people in the wake of the Nov. 9 municipal elections. Right-wing and former Sandinista groups claimed wide-spread election fraud in the elections but failed to file evidence with the Supreme Electoral Council while conducting a national and international media campaign demanding an internationally observed recount and then annulment of the election. The Supreme Electoral Council announced final results on Nov. 20 giving 105 city halls to Sandinista (FSLN) candidates. The larger of the two Liberal alliances, headed by the right-wing Constitutional Liberal Party (PLC) won 37 municipalities but had hoped for many more, and the smaller Nicaraguan Liberal Alliance (ALN) won four municipalities.

A move in the National Assembly to pass a constitutionally shaky bill to annul the elections appears doomed as the PLC has been unable to convince six legislators from the ALN to give up the four mayor's offices and 39 city council seats that the party won and to vote for a re-run of the elections in which they could lose everything. On Dec. 1, other possible allies of the PLC began to break away as well. Guillermo Osorno of the Christian Path Party said that he opposed to the bill because the legislative branch did not have the authority under the constitution to annul the elections. Independent deputies Mario Valle and Juan Ramon Jimenez said that they had called “the most hard-line people” of the PLC and the FSLN to “a reflection” about the effects on the nation of a continuation of the present confrontations.

Topic 2: US suspends Millennium Challenge money and Europe slows aid

In a communiqué released on Nov. 25, the United States government announced that, “as a result of the actions of the government of Nicaragua,” it would not approve further disbursement of money to Nicaragua under the Bush administration's Millennium Challenge Account (MCA) to any program not directly under the administration of CRM-Nicaragua, the entity which implements the program. The program is supervised directly by the White House and stipulates that governments must meet specific goals of governance as judged by the United States. Since July 2005, the program has supported projects in the departments of Leon and Chinandega to improve transportation networks and improve the incomes of farmers, according to the program's own description. This suspension is outrageous given that the U.S. owes Nicaragua an estimated US$17 billion in reparations for the illegal contra war of the 1980s.

According to the MCA, there remain US$64 million of the US$175 planned for disbursement. That money was for highway repair by the Ministry of Transportation. Vice-Minister of Foreign Affairs for International Cooperation Valdrack Jaentschke responded, “They are freezing resources that have been well used, which the U.S. government publically acknowledged, in reprisal and in order to blackmail Nicaragua. This is unethical and unacceptable.”

President Daniel Ortega, speaking from a meeting in Caracas of members of the Bolivarian Alternative for the Americas (ALBA), said, referring to the aid suspension, “The truth is that we are a little bit freer and when we have powerful instruments like the ALBA, we feel that we are not fighting these battles alone.” Vice Minister of Foreign Affairs Manuel Coronel said that Nicaragua would look to fill the vacuum left by the withdrawal of this aid with aid from other countries such as Russia. Venezuelan President Hugo Chavez offered to make up any losses in aid that are imposed on Nicaragua. The six ALBA countries (Venezuela, Bolivia, Nicaragua, Cuba, Honduras, and Dominica) plus Ecuador, agreed to launch a common currency for transactions among them and to reduce dependence on the US dollar.

Jose Adan Aguerri, president of the Superior Council of Private Enterprise (COSEP), said that 800 workers on MCA projects were “up in the air” awaiting a final decision which will be made by the board of the MCA on Dec. 11. Aguerri said that some 4,000 families or 20,000 people could be affected. Besides road construction, he mentioned program to give land titles to small producers so that they can get loans for planting and other programs benefitting dairy farmers and cooperatives of plantain growers.

Omar Halleslevens, head of the Nicaraguan Army, said that he would do whatever was possible to maintain relations with the United States Army, in spite of the decision to freeze the MCA funds. Helleslevens said that the Army's relationship with the U.S. Army was part of an international relations framework which included “other armed forces.” He calculated that military aid received from the U.S. in 2008 had totaled some US$6 million including attendance at seminars and courses (at the infamous School of the Americas) and he expected aid to reach the same amount in 2009.

Benita Ferrero-Waldner, European Commissioner for External Relations, called Nicaraguan Foreign Minister Samuel Santos on Nov. 24 to say that the European Union would pay for new municipal elections if Nicaraguans believed that would resolve the conflict. Radio La Primerisima, which gives critical support to the Sandinistas, called the offer a “new and open intervention by the EU in Nicaragua's internal affairs.” The Inter-American Commission on Human Rights (IACHR) expressed alarm about the violence that erupted after the elections and proposed a visit of a rapporteur to investigate the situation.

According to a study by independent economist Adolfo Acevedo of the foreign aid expected to be received by the government to support the national budget, less than half has been disbursed, a total of US$229.1 million out of US$510.68 million. According to an article in the magazine Confidencial, reprinted in El Nuevo Diario, the disbursements have been delayed by “the crisis of democratic credibility” facing the government. According to the article, all bilateral donors except Norway and Switzerland have cancelled or reduced their support, with the European Union scheduled to make a decision in the next few days. Monies from the World Bank and the Inter-American Development Bank are held up by the failure of the National Assembly to pass legislation required by Nicaragua's agreement with the International Monetary Fund. The FSLN has a minority in the National Assembly.

Topic 3: Women march against violence, but divided; Oxfam-GB cleared of charges

Nicaraguan women's organizations marched in opposing groups on Nov. 25 to mark the International Day for an End to Violence against Women. The Movement of Sandinista Women marched to the Public Ministry and demanded that Attorney General Julio Centeno Gomez come out to meet them to receive a document demanding greater enforcement of the laws against abuse of women. Centeno, of the PLC, refused to meet with the women. They also read a pronouncement in which they accused past neoliberal governments of systematic violation of women's rights.

The other group, organized by non-governmental organizations critical of the Ortega government, was prevented by police from reaching the Public Ministry while the Sandinista women were there so they held their rally in front of the National Police headquarters. Vilma Nuñez, president of the Nicaraguan Center for Human Rights, said that the march had as its goal the Public Ministry because that office is prosecuting nine women active in the struggle to decriminalize therapeutic abortion. Activists from the two groups shouted at each other from a distance. Both sides highlighted government figures which showed that 36 women have died so far this year from domestic violence.

In related news, Oxfam-Great Britain was cleared of all charges by the Ministry of Government on Nov. 24, following an investigation into several grants to Nicaraguan non-governmental organizations (NGOs). Clare Moberly, Oxfam-GB representative in Managua, said that the work of Oxfam in Nicaragua since 1963 has always been to support the development of the country. The Ortega government has launched an ongoing investigation of foreign funding of NGOs, a favored technique of the US government and European allies to manipulate elections and sow civil unrest in countries with leftist governments. Unfortunately, the Ortega government is using this legitimate investigation to harass women's organizations that are working to return the 100 year old right women's right to therapeutic abortion which was criminalized in 2006 with FSLN support in the National Assembly.

Topic 4: Nicaragua's economy has both good and bad news

Nicaraguan exports to Europe fell considerably in 2008, led by an over 50% decrease in export of fruits and vegetables. On the other hand, according to Manuel Alvarez, president of the Union of Agricultural Producers, the 2008-2009 agricultural season could close the year with a growth of 15%, due to the favorable conditions of the past rainy season and the increase of acreage planted. The Ortega government has prioritized reactivation of the small and medium agriculture sector after 17 years of neglect by neoliberal governments. Alvarez said that the sector is optimistic about a production increase but also faces many problems such as acquiring certified seeds and fertilizer. “The first harvest was good and the second harvest was excellent,” said Alvarez. However, in spite of the growth in production, the rising costs have raised the price of rice and beans beyond the means of many Nicaraguans, he said.

Exports of dairy products could, by the end of the year, hit between US$84-100 million, maintaining a yearly growth rate of 10% according to producers, who said, however, that it could have been an even better year if the transportation infrastructure were improved. While the price of gasoline and diesel continues to fall, the cost of the “basic basket” of products needed for a family to survive continues to rise. Retailers expect it to rise even higher by Christmas. Marcelina Garcia, a vendor in the Ivan Montenegro market, said “The basic basket will be too expensive. There is nothing. The cabbage was lost in the rains as were the tomatoes. Costa Rica has no potatoes.” And, in Bilwi, capital of the North Atlantic Autonomous Region (RAAN), the fishing industry is facing one of its worst moments in history because of an international drop in the price of fish, the lack of buyers in the North American market, and bad weather in the Caribbean over the last several months.

A modern factory that produces sacks made from polypropene fibers, funded with a loan from BANDES, the Venezuelan development bank through ALBA, was inaugurated in Posoltega. It is run by Nicaraocoop, a cooperative agricultural services business, and will sell the sacks at fair trade prices to farming cooperatives. But, on Nov. 29, La Prensa claimed that the drop in the price of petroleum was going to make it impossible for Venezuela to fulfill its commitments to fund projects in Nicaragua and elsewhere, including an oil refinery in the Department of Leon that is supposed to be completed in four years at a cost of US$3.9 billion. BANDES manager in Nicaragua, Leonardo Sanchez, quickly gave assurances that the social programs in Nicaragua were not in any danger from the drop in the price of oil and Ecuadoran President Correa said that reports Venezuela was reevaluating the building of refineries were false.

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