Nicaragua Network

1. Russian President Vladimir Putin stops for a quick visit to Nicaragua
2. Information on environmental impact of canal released
3. Ortega meets with World Bank and US Chamber of Commerce representatives
4. Economic Briefs: Basic basket, Social Security, and Better Work
5. Two Chikungunya cases confirmed
6. Ortega offers solidarity to Palestine and Argentina

1. Russian President Vladimir Putin stops for a quick visit to Nicaragua

Although his published schedule showed Russian President Vladimir Putin travelling from Cuba directly to Argentina on July 11, his plane made a two hour stop in Managua where he met with President Daniel Ortega and other Nicaraguan officials. However, the visit was evidently not a spur of the moment stop because Putin’s first words were to thank Ortega for inviting him. Putin expressed his congratulations on the up-coming 35^th anniversary of the Sandinista Revolution and noted that the end of this year will mark the 70^th anniversary of the opening of diplomatic relations between Russia and Nicaragua. He said, “Nicaragua is a very important partner for Russia in Latin America,” and added, “We still have much to do to develop our relations, especially in the economic arena, but we have a strong base from which to do it.”

Ortega said that the “lightning visit” was historic: “The first time that a president of Russia visits Nicaragua.” He said that as he was driving to the airport he noted the many public transportation busses that Russia had donated to Nicaragua, “carrying people to work and back home.” Ortega said, “We admire and recognize your initiatives in favor of peace in the face of world conflicts.” Accompanying Ortega to greet Putin were Communications Coordinator Rosario Murillo, Vice-Foreign Minister Valdrak Jaentschek, Laureano Ortega of ProNicaragua [foreign investment], Salvador Mansell of ENATREL [energy], Head of the Army Julio Cesar Aviles, and Head of the National Police Aminta Granera. Putin was accompanied by his Foreign Minister Sergei Lavrov and by Igor Sechin, head of the state oil company ROSNEFT.

Russia donated 100,000 tons of wheat a year to Nicaragua three years in a row beginning in 2011with a total estimated value of US$30 million, along with 520 urban transportation busses and 500 Lada cars to be used as taxis, emergency equipment to SINAPRED for disaster relief, and assistance for fighting drug trafficking. A communique from the Russian government said that the two presidents had spoken of the creation of a fueling and maintenance station for Russian ships in Nicaragua as well as the possible installation of a station that would be part of Russia’s satellite-based navigation system known as GLONASS.

Sandinista National Assembly Deputy Jacinto Suarez, who chairs the Foreign Affairs Committee, said that Putin’s visit “puts Nicaragua on the map,” adding that whenever the head of a big country pays Nicaragua a visit it is important. He stated, “There is a growing interest in Nicaragua as a place for investment and development, but also because of the canal.” Russian Ambassador to Nicaragua Nicolay M. Vladimir told El Nuevo Diario in June that his country is “waiting with patience” for concrete plans for the canal to be released in order to bid for contracts.

Conservative Party leader Alfredo Cesar said Nicaragua benefits more from its relationship with European countries and the US and it would have been better if Ortega had let Putin go directly from Cuba to Argentina because “It is dangerous to get too close to Russia under current circumstances.” Eduardo Montealegre, head of the Independent Liberal Party, said that Putin wanted to send two messages. To the United States, referring to NATO’s push into Eastern Europe, “He was saying, ‘If you come into my sphere of influence, I also can come into yours.’” And to China, Montealegre said Putin was saying, “If you build a canal in Nicaragua, Russian interests need to be taken into account.” (Radio La Primerisima, July 13; El Nuevo Diario, July 12, 13, 14; Informe Pastran, July 14)

2. Information on environmental impact of canal released

The British firm Environmental Resources Management (ERM) revealed last week the reasons behind the choice of Route 4 (from the Brito River on the Pacific to the Punta Gorda River on the Caribbean) out of the six originally proposed for the shipping canal across Nicaragua. Routes 1 and 2 were eliminated for a number of reasons. Pearl Lagoon and Bluefields Bay included the nesting sites of four endangered sea turtle species and Bluefields Bay is a designated Ramsar wetlands. The hydrodynamics of the Bay and of the Escondido River estuary and their eco-systems would have been affected, according to ERM. Those routes were also eliminated because of the presence of important indigenous communities and coral reefs and last, but not least, higher engineering costs. Route 3 was ruled out because of threats to the Bay of Bluefields and its effects on the traditional territories of the indigenous Rama communities, including Rama Cay, the traditional center of Rama culture. Routes 5 and 6 were discarded by the Nicaraguan government for environmental reasons but also because of certain opposition from Costa Rica, Nicaragua’s neighbor on the other side of the river. For maps showing the chosen route, including the artificial lake that will be created in Nueva Guinea, go to http://www.elnuevodiario.com.ni/infografia/1952 and http://www.elnuevodiario.com.ni/infografia/1950

Alberto Vega of ERM explained that the environmental challenges for the construction of the canal include minimizing the amount of water used from Lake Cocibolca, designing locks that will prevent introduction of salt water, and improving watershed management, especially that of the Punta Gorda River. He noted that the project crosses part of Rama territory on the Caribbean and part of the Nahua community on the Pacific and those groups will have to be consulted and a socioeconomic study carried out. A census will be taken and the affected families will be consulted about relocation options. He added that degraded areas in the Indio Maiz and Punta Gorda Reserves will be rehabilitated and “watershed management improved.” He said it would be necessary to “provide alternatives and better conditions of life, compensation and financing to improve the San Miguelito Ramsar site” on the southeast coast of Lake Cocibolca which he said had been impacted by agriculture, cattle ranching and invasive species. He said that some communities would have to be resettled but did not give a number. The canal route crosses the Cerro Silva Reserve and part of the Mesoamerican Biological Corridor. The Cerro Silva Reserve, which extends from the Rio Grande de Matagalpa in the north to the Costa Rican border in the south, contains coastal ecosystems, wetlands, and tropical rainforest. On the Pacific side, Vega said that the beach and estuary of the Brito River would be impacted, affecting the nesting areas for three species of sea turtles. Whales and dolphins in the bay would be affected also along with nearby tropical dry forest, habitat for spider monkeys. He said that studies will identify critical habitats and, in consultation with conservation organizations, “plans to mitigate and offset inevitable impacts will be formulated.” He noted that 30 ERM and 80 Nicaraguan experts had been working on the environmental studies during the past months.

Maura Paladino of the Humboldt Center said that along the proposed canal route more than a dozen animals from the Red List of Threatened Species of the International Union for Conservation of Nature (IUCN) will be impacted. Among the red list species, she said, were sea turtles, the green macaw, the tapir, the spider monkey, and several species of frogs. She also said, “When we are speaking of the impact area we are referring to a belt ten kilometers wide along the northern side of the canal and another similar belt to the south of the canal. There we have more than 200 communities, in six municipalities (similar to counties) and one municipal (county) seat.” The Southeast Biosphere Reserve of Nicaragua is composed of seven protected areas: Cerro Silva Nature Reserve, Punta Gorda Nature Reserve, Indio Maiz Biological Reserve, Rio San Juan Wildlife Refuge, Los Guatuzos Wildlife Refuge, the Archipelago of Solentiname National Monument in Lake Cocibolca, and the Fort of the Immaculate Conception of Mary on the San Juan River. The first three will be affected by the canal. To see a map of Rama territory and the nature reserves, go here: http://old.kaosenlared.net/media/6/6879_4_4_Territorio_Rama_y_Kriol.jpg

National Assembly Deputy Brooklyn Rivera, chair of the Indigenous Peoples Committee, said that indigenous and Afro-descendent communities could “disappear” if the canal is built along the selected route. He said that nine indigenous communities with at least 1,500 people would be affected. Allen Clair Duncan, president of the communal government of Monkey Point and a member of the Rama-Kriol Territorial Government of Bluefields, said that they are taking the case to the Inter-American Commission on Human Rights and asking for a ruling to stop the building of the canal.  He said that the Supreme Court of Nicaragua had denied their suit, “because they didn’t know where the canal would go and therefore it wasn’t violating any rights, but now we can see it goes through our territory.”

President Daniel Ortega, however, said with the advance of the agricultural frontier Nicaragua has been losing its forests and the only way to save such natural reserves as Bosawas and Indio Maiz is with the earnings that the canal will generate. He noted that with the studies currently being made, “We are getting detailed information that permits us to study which are the most fragile, vulnerable, damaged zones from the environmental and social viewpoints.” (El Nuevo Diario, July 8, 9; Informe Pastran, July 9; La Prensa, July 9)

3. Ortega meets with World Bank and US Chamber of Commerce representatives

President Daniel Ortega met last week with Sri Mulyani Indrawati, managing director of the World Bank, and with Jodi Hanson Bond, vice-president for the Americas of the US Chamber of Commerce. Indrawati said that Nicaragua had the healthiest portfolio of projects in Latin America. She said, “At this moment, the portfolio of projects of the World Bank with Nicaragua is not only the healthiest but it is one of the best that we have in all of Latin America.” She added that Nicaragua has achieved two important things which are macroeconomic stability and inflation control along with a change in its energy matrix toward renewables. But, she said that Nicaragua needed to grow even more, improving education, improving the connectivity of its roads, increasing agricultural productivity, taking more advantage of geothermal energy potential, and attracting more investment.

In his meeting with Bond, Ortega highlighted the importance for Nicaragua of an extension of tariff preference levels (TPL) to continue to allow US access for garments made in Nicaragua with materials not originating in DR-CAFTA (Dominican Republic-Central America Free Trade Agreement) countries. “All of us in Central America,” he said, “share this concern and we are evaluating what could happen after December…in terms of employment” if TPL is not extended. He also said that he was concerned about the trade agreement now under negotiation known the Trans-Pacific Partnership (TPP) and the impact it could have on DR-CAFTA member countries. “We hope that the TPP will not weaken our sub-regional accord,” he said. Bond said that she hoped to work with Ortega’s team on CAFTA issues and other aspects of development and would support Nicaragua serving as the site of the 2017 AMCHAM Latin American meeting. In departing she asked to have her photo taken next to a giant picture of Augusto Sandino. (El Nuevo Diario, July 12; Informe Pastran, July 14; Radio La Primerisima, July 13)

4. Economic Briefs: Basic basket, Social Security, and Better Work

The cost of the “basic basket” of 53 widely used consumer products (Nicaragua’s cost of living measurement) rose 8.5% in the first six months of 2014 to $471.50 per month. Juan Sebastian Chamorro, executive director of the Nicaragua Foundation for Economic and Social Development (FUNIDES) said that their most recent survey of consumers showed rising prices to be their principal problem. (El Nuevo Diario, July 8)

The number of people employed in the formal economy and enrolled in the Social Security system rose by 5.7% in the first four months of 2014, a growth of about 14,000 jobs. The industries with the highest growth rates were trade, transportation, and electricity, gas, and water, according to a report by FUNIDES.  Real wages adjusted for inflation grew by 3.3% in the same period. The inflation rate for May of this year was 4.8%, one full point lower than in December of 2013. (Informe Pastran, July 8)

More than 52% of the textile and sportswear workforce, 38,000 employees, have benefitted from the Better Work Program of the International Labor Organization (ILO) and the World Bank’s International Financial Corporation (IFC). According to Elena Arengo, Better Work coordinator for Nicaragua, the objective of the program is to broaden opportunities for decent work in the textile industry by improving its competitiveness in accord with labor laws. Twenty-three of the country’s 47 maquiladoras are participating in the program and their workers have received the Better Work training over the past three years. Nicaragua was the first country in the region to implement the program which has brought significant improvements in occupational health and safety and reduced costs for the participating companies. (El Nuevo Diario, July 13)
 

5. Two Chikungunya cases confirmed

Two cases of the dengue-like disease Chikungunya were confirmed in Nicaragua last week. Other suspected cases turned out to be negative. The confirmed cases were a Honduran mother and daughter who were infected while visiting the Dominican Republic before entering Nicaragua. Chikungunya originated in Africa and is spreading through the Caribbean and Latin America with a significant number of cases in Honduras and El Salvador. Nicaragua, which already has an aggressive program of mosquito abatement, has so far not had any cases originate in the country.  The Ministry of the Family is organizing each community to eliminate mosquito breeding areas. Volunteers have visited 400,000 homes, eliminated 4,500,000 breeding areas, done abatement work at 600,000 houses, and fumigated another 700,000 homes. On June 27 Nicaragua declared a health alert, increasing its vigilance at ports and airports, and increasing mosquito abatement efforts. (Informe Pastran, July 14; Radio La Primerisima, July 10)

6. Ortega offers solidarity to Palestine and Argentina

President Daniel Ortega expressed his solidarity with the people of Palestine and the government of Argentina as Palestinians face attacks from Israeli occupation forces and Argentina deals with a US Supreme Court decision that will require it to pay enormous sums to “vulture fund” creditors. (The Supreme Court refused to review a lower court ruling that Argentina must pay in full New York hedge funds which bought discounted debt from Argentina’s 2001 default, a total of US$1.33 billion.)

An outraged Ortega condemned Israel for “committing genocide against the Palestinian people again. There are already 80 dead there [current total is 200]. Children, young people, people of all ages. Who is for genocide?” He reiterated that Nicaragua, as a member of the Community of Latin American and Caribbean States (CELAC) “is totally committed to peace when we have suffered so many wars here, and so much blood has run. Peace has cost us so much!” he said.

At a meeting with World Bank Managing Director Sri Mulyani Indrawati, Ortega expressed Nicaragua’s solidarity with Argentina and President Cristina Fernandez de Kirchner. “We are joining forces, supporting the government of Argentina in the case of the so-called vulture funds,” he said. Ortega criticized “the vultures that are up there, backed by other vultures including that judge [US District Judge Thomas Griesa] of the United States who ruled in favor of them.” He reiterated Nicaragua’s solidarity with Argentina saying, “We know that they are talking and we hope that this situation can be resolved.” (Radio La Primerisima, July 10)