2016 Country Review
Table of Contents
Chapter 1 1
Country Overview 1
Country Overview 2
Key Data 3
Central America and the Carribean 5
Chapter 2 7
Political Overview 7
Political Conditions 9
Political Risk Index 27
Political Stability 42
Freedom Rankings 57
Human Rights 69
Government Functions 71
Government Structure 73
Principal Government Officials 78
Leader Biography 79
Leader Biography 79
Foreign Relations 85
National Security 91
Defense Forces 92
Chapter 3 94
Economic Overview 94
Economic Overview 95
Nominal GDP and Components 97
Population and GDP Per Capita 99
Real GDP and Inflation 100
Government Spending and Taxation 101
Money Supply, Interest Rates and Unemployment 102
Foreign Trade and the Exchange Rate 103
Data in US Dollars 104
Energy Consumption and Production Standard Units 105 Energy Consumption and Production QUADS 107
World Energy Price Summary 108
CO2 Emissions 109
Agriculture Consumption and Production 110
World Agriculture Pricing Summary 112
Metals Consumption and Production 113
World Metals Pricing Summary 115
Economic Performance Index 116
Chapter 4 128
Investment Overview 128
Foreign Investment Climate 129
Foreign Investment Index 131
Corruption Perceptions Index 144
Competitiveness Ranking 156
Stock Market 165
Partner Links 166
Chapter 5 167
Social Overview 167
Human Development Index 169
Life Satisfaction Index 173
Happy Planet Index 184
Status of Women 193
Global Gender Gap Index 196
Culture and Arts 205
Travel Information 207
Diseases/Health Data 216
Chapter 6 222
Environmental Overview 222
Environmental Issues 223
Environmental Policy 224
Greenhouse Gas Ranking 225
Global Environmental Snapshot 236
Global Environmental Concepts 247 International Environmental Agreements and Associations 262
Bibliography 287 Nicaragua
Nicaragua Review 2016 Page 1 of 299 pages
Nicaragua is a country in Central America, bordering both the Caribbean Sea and the North Pacific
Ocean, between Costa Rica and Honduras. Nicaragua was ruled by Spain from the early 16th century until it became independent in 1821. In 1823 the former Spanish colonies of the region formed the Federation of Central America, but the union collapsed in 1838 and Nicaragua became an independent republic.
Much of Nicaragua's politics since independence has been characterized by the rivalry between the Liberal and the Conservative parties, which often led to civil war. Violent opposition to government control and corruption brought the Marxist Sandinista guerrillas to power in 1979. In response to both domestic and international pressure, the Sandinista regime entered into negotiations with the Nicaraguan resistance and agreed to nationwide elections in February 1990. Free elections in 1990,
1996, and 2001 saw the Sandinistas defeated, but former Sandinista leader Daniel Ortega made a comeback in the November 2006 presidential race. Never rich in the first place,
Nicaragua is striving to overcome the after-effects of dictatorship, civil war and natural disasters, all of which have made it the second-poorest country in the Western Hemisphere after Haiti. The new government under President Daniel Ortega taking office since January 2007 has shown willingness to maintain the market-oriented economic policies, and the country's infrastructure and economy are slowly being rebuilt.
Note that President Daniel Ortega was re-elected to power in 2011 and remains in power to date.
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Region: Central America and the Carribean
Climate: Tropical in lowlands, cooler in highlands
Languages: Spanish (official)
Currency: 1 gold cordoba (C$) = 100 centavos
Holiday: Independence Day is 15 September (1821), Revolution Day is 19 July
Area Total: 129494
Area Land: 120254
Coast Line: 910
Nicaragua Review 2016 Page 3 of 299 pages
Nicaragua Review 2016 Page 4 of 299 pages
Central America and the Carribean
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Nicaragua Review 2016 Page 6 of 299 pages Nicaragua
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Nicaragua takes its name from Nicarao, chief of the indigenous tribe that lived around present-day
Lake Nicaragua. Prior to colonialism, Nicaragua was also inhabited by the Chorotegas in the Pacific region. To the west of the volcanic chain were the Maribios, from which the name
Marrabios Range is derived. The culture and lifestyle of these peoples tended to similar to those of Mexico, characterized particularly by a trading system based on bartering or exchanges with neighboring groups. On the Caribbean and Atlantic coast, the Sumos, Miskitos and Ramas made their home; the latter two groups were particularly connected in the ethno-linguistic sense. The culture and lifestyle of these Caribbean and Atlantic groups were more nomadic, were absent of permanent towns, and tended to include very little in the way of political and social organization.
The practice of shamanism was also commonplace.
In 1523, a Spanish captain named Gil Gonzalez de Avila reached the Gulf of Nicoya, and traveled from there to the Chorotega town of Nicoya. His initial engagement with indigenous peoples, such as the indigenous leader Nicarao, resulted in the baptism of the local people into Christianity at the behest of the Spanish. Subsequent expeditions ended far less peacefully. In one case Gonzalez and his expedition were surrounded by the indigenous chief Diriangen, and in another case, an attack by Chief Nicaragua resulted in the Spaniards' retreat to the Gulf of Nicoya.
In 1524, Francisco Hernandez de Cordoba completed the conquest of the region and founded the first Spanish permanent settlements in the region, including two of Nicaragua's principal towns:
Granada on Lake Nicaragua, and Leon east of Lake Managua. In 1542, laws were passed that essentially centralized Spanish authority and instituted a legal and judicial system aimed at controlling the distribution of land and the charging of taxes to the indigenous people.
In 1610, an earthquake destroyed the city of Leon. As a result, the city was relocated to its current site. Meanwhile, Granada was expanding due to its trade routes through Lake Cocibolca and the San Juan River. The city was, at the same time, the site of unwelcome attacks by pirates who also gained access to the city through the these waterways.
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Nicaragua gained independence from Spain in 1821, briefly becoming a part of the Mexican
Empire and then a member of a federation of independent Central American provinces. In 1838,
Nicaragua became an independent republic.
Note on History: In certain entries, open source content from the State Department Background
Notes and Country Guides have been used. A full listing of sources is available in the Bibliography.
Nicaraguan politics since independence have been characterized by the rivalry between the Liberal elite of Leon and the Conservative elite of Granada, a rivalry that often spilled into civil war.
Initially invited by the Liberals in 1855 to join their struggle against the Conservatives, an American named William Walker and his "filibusters" seized the presidency in 1856. The Liberals and Conservatives united to drive him out of office in 1857, after which a period of three decades of Conservative rule ensued.
Taking advantage of divisions within the Conservative ranks, Jose Santos Zelaya led a Liberal revolt that brought him to power in 1893. Zelaya ended the long-standing dispute with Britain over the Atlantic coast in 1894, and reincorporated that region into Nicaragua.
Influence of the United States
Differences arose between the United States and Nicaragua concerning an isthmian canal and concessions to Americans in Nicaragua. In 1909, the United States provided political support to
Conservative-led forces rebelling against President Zelaya and intervened militarily. Zelaya resigned later that year.
With the exception of a nine-month period in 1925-26, the United States maintained troops in
Nicaragua from 1912 until 1933.
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From 1927-1933, United States Marines stationed in Nicaragua engaged in a running battle with rebel forces led by Liberal general Augusto Sandino, who rejected a 1927 negotiated agreement brokered by the United States to end the latest round of fighting between Liberals and Conservatives.
Somozo Comes to Power
After the departure of United States troops, National Guard Commander Anastasio Somoza
Garcia, outmaneuvered his political opponents, including Sandino, who was assassinated by
National Guard officers and took over the presidency in 1936. Somoza and his two sons who succeeded him maintained close ties with the United States. The Somoza years were notorious for their authoritarianism and rampant repression.
The Somoza dynasty ended in 1979 with an uprising by the Sandinista National Liberation Front, or FSLN, which began conducting a low-level guerrilla war against the Somoza regime from the early 1960s.
The dictatorship's repression of civil liberties and the lack of representative institutions slowly led to the consolidation of the opposition and armed resistance. The Somoza regime continually threatened the press, mostly the newspaper La Prensa and the critical editorials of its publisher and Udel leader, Pedro Joaquín Chamorro Cardenal.
During October 1977, a group of prominent Nicaraguan businesspeople and academics, among then Sergio Ramírez Mercado--known as Los Doce (the Group of Twelve)--met in Costa Rica and formed an anti-Somoza alliance.
The final act in the downfall of the Somoza era began on January 10, 1978, when Chamorro was assassinated. Although his assassins were not identified at the time, evidence implicated President
Somoza's son and other members of the National Guard. The opposition held the president and his guards responsible for Chamorro's murder, thus provoking mass demonstrations against the regime.
The Episcopate of the Nicaraguan Roman Catholic Church issued a pastoral letter highly critical of the government, and opposition parties called for Anastasio Somoza Debayle's resignation. On
January 23, a nationwide strike began, including the public and private sectors; supporters of the stride demanded an end to the dictatorship.
The National Guard responded by further increasing repression and using force to contain and intimidate all government opposition. Anastasio Somoza Debayle, meanwhile, asserted his intention to stay in power until the end of his presidential term.
Nicaragua Review 2016 Page 10 of 299 pages Nicaragua
On February 1, 1979, there was a formal unification of the Sandinista guerrillas. In March, heavy fighting broke out all over the country. They launched their final offensive during May, just as the National Guard began to lose control of many areas of the country. In a year's time, bold military and political moves had changed the Sandinista National Liberation Front, or FSLN, from one of many opposition groups to a leadership role in the anti-Somoza revolt.
In June 1979, a provisional Nicaraguan government in exile, consisting of a five-member junta, was organized. Known as the Puntarenas Pact, an agreement reached by the new government in exile (in Costa Rica) called for the establishment of a mixed economy, political pluralism, and a nonaligned foreign policy. Free elections were to be held at a later date, and the National Guard was to be replaced by a nonpartisan army.
The members of the new junta were Daniel José Ortega Saavedra of the FSLN, Moisés Hassan
Morales of the National Patriotic Front (Frente Patriótico Nacional, or FPN), Sergio Ramírez
Mercado of Los Doce, Alfonso Robelo Callejas of Nicaraguan Democratic Movement
(Movimiento Democrático Nicaragüense, or MDN), and Violeta Barrios de Chamorro, the widow of La Prensa's editor.
The new government inherited a country in ruins, with a stagnant economy and a debt of about
US$1.6 billion. An estimated 50,000 Nicaraguans were dead, 120,000 were exiles in neighboring countries, and 600,000 were homeless. Food and fuel supplies were exhausted, and international relief organizations were trying to deal with disease caused by lack of health supplies. Yet the attitude of the vast majority of Nicaraguans toward the revolution was decidedly hopeful. Most
Nicaraguans saw the Sandinista victory as an opportunity to create a system free of the political, social, and economic inequalities of the almost universally hated Somoza regime.
The junta appointed individuals from the private sector to head the government's economic team.
They were responsible for renegotiating the foreign debt and channeling foreign economic aid through the state-owned International Reconstruction Fund (Fondo Internacional de
Reconstrucción--FIR). The new government received bilateral and multinational financial assistance and also rescheduled the national foreign debt on advantageous terms. Pledging food for the poor, the junta made restructuring the economy its highest priority.
At first the economy experienced positive growth, largely because of renewed inflow of foreign aid and reconstruction after the war. The new government enacted the Agrarian Reform Law, beginning with the nationalization of all rural properties owned by the Somoza family or people associated with the Somozas. These farms became state property under the new Ministry of Nicaragua Review 2016 Page 11 of 299 pages Nicaragua
Agrarian Reform. Large agroexport farms not owned by the Somozas generally were not affected by the agrarian reform. Financial institutions, all in bankruptcy from the massive capital flight during the war, were also nationalized.
The second goal of the Sandinistas was a change in the old government's pattern of repression and brutality toward the general populace. Indeed, in their first two years in power, Amnesty
International and other human rights groups found the human rights situation by the new goverment in Nicaragua greatly improved from the past.
The third major goal of the country's new leaders was the establishment of new political institutions to consolidate the revolution. On August 22, 1979, the junta proclaimed the Fundamental Statute of the Republic of Nicaragua. This statute abolished the constitution, presidency, Congress, and all courts. The junta ruled by unappealable degree under emergency powers. National government policy, however, was generally made by the nine-member Joint
National Directorate (Dirección Nacional Conjunto--DNC), the ruling body of the FSLN, and then transmitted to the junta by Daniel Ortega for the junta's discussion and approval.
Nicaraguan-United States relations deteriorated rapidly as the new FSLN regime went through this nationalization process, along with the suspension of constitutional democracy.
From late 1979 through 1980, the Carter administration in the United States had made efforts to work with FSLN policies. However, when President Ronald Reagan took office in January 1981, the United States government launched a campaign to isolate the Sandinista government. Claiming that Nicaragua, with assistance from Cuba and the Soviet Union, was supplying arms to the guerrillas in El Salvador, the Reagan administration suspended all United States aid to Nicaragua on
January 23, 1981. The Nicaraguan government denied all United States allegations and charged the United States with leading an international campaign against it. Later that year, the Reagan administration authorized support for groups trying to overthrow the Sandinistas.
The United States supported groups of disgruntled former members of the National Guards who had fled to Honduras after the fall of President Somoza. These groups became known as the Contras. By the end of 1981, however, the group's membership had multiplied because disgruntled peasants from the north and ethnic groups from the Atlantic coast had joined in the counterrevolutionary war. Nevertheless, early Contra leadership was represented mostly by former members of the National Guard; this fact made the movement highly unpopular among most
Although the Sandinista army was larger and better equipped than the Contras, the antigovernment campaign became a serious threat to the FSLN government, largely through damage to the economy. As the Contra war intensified, the Sandinistas' tolerance of political pluralism waned.
The Sandinistas imposed emergency laws to ban criticism and organization of political opposition.
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Most social programs suffered as a result of the war because the Sandinista regime was forced to increase military spending until half of its budget went for defense.
Chamorro Comes to Power
In response to both domestic and international pressure, the Sandinista regime, under the leadership of Daniel Ortega, entered into negotiations with the Nicaraguan Resistance to democratize the political scenario in the country.
In 1983, the Council of State passed an amended Political Parties Law. Amendments to the law promised all parties full access to the media. In mid-1984, the Electoral Law was passed setting the date and conditions for the election.
Soon thereafter, Ortega's government agreed to nationwide elections in February 1990. In these elections, which were proclaimed free and fair by international observers, Nicaraguan voters elected the candidate of the National Opposition Union and former member of the junta that ousted Somoza from power, Violeta Barrios de Chamorro, as president.
During President Chamorro's nearly seven years in office, her government achieved major progress toward consolidating democratic institutions, advancing national reconciliation, stabilizing the economy, privatizing state-owned enterprises and reducing human rights violations.
Chamorro's government came under fire from opposition forces for reconciling with the FSLN and for retaining Daniel Ortega's brother, Humberto Ortega, as Commander of the Armed Forces. Led by conservative Godoy Reyes, the opposition bloc criticized Chamorro's relations with the Sandinistas stating it was "immoral."
In February 1995, Sandinista Popular Army Commander General Humberto Ortega was replaced, in accordance with a new Military Code. General Joaquin Cuadra, who espoused a policy of greater professionalism in the renamed Army of Nicaragua, enacted the Military Code in 1994. In addition, a new police organization law, which was passed by the National Assembly and signed into law in August 1996, further codified civilian control of the police.
A Democratic Transition of Power
A number of irregularities, due largely to logistical difficulties and a complicated electoral law hindered the next elections. However, the Oct. 20, 1996, presidential, legislative and mayoral elections were also judged free and fair by international observers and by the newly established national electoral observer group "Etica y Transparencia" (Ethics and Transparency). In all, 35
Nicaragua Review 2016 Page 13 of 299 pages Nicaragua political parties participated in the Oct. 20, 1996, general elections, independently or as part of one of five electoral coalitions. Seventy-six percent of Nicaragua's 2.4 million eligible voters participated in the elections.
The "Alianza Liberal" also known as the Liberal Alliance or AL, a coalition of the "Partido Liberal
Constitucionalista," also called the Constitutional Liberal Party or PLC, four other political parties, and factions of another two, won the presidency, as well as a plurality in the national legislature and a large majority of the mayoral races. The AL candidate and former Managua Mayor, Arnoldo
Alemán Lacayo received slightly more than 51 percent of the vote, defeating 22 other candidates.
In this way, Nicaraguans elected former Alemán, leader of the center-right Liberal Alliance, as president.
The "Frente Sandinista de Liberación Nacional," also known as the Sandinista National Liberation
Front or FSLN, candidate, Daniel Ortega Saavedra (former leader of Nicaragua), received 37.75 percent of the vote. Guillermo Antonio Osorno Molina, the candidate of the new "Partido Camino
Cristiano Nicaraguënse," or PCCN, ran a distant third, receiving only 4.1 percent of the vote. Noel
José Vidaurre of the "Partido Conservador de Nicaragua," also known as the Nicaraguan
Conservative Party or PCN, and Benjamin Lanzas of the "Proyecto Nacional," also called the National Project or PRONAL, rounded out the top five finishers, with 2.26 percent and 0.53 percent of the vote, respectively. Eighteen other candidates combined for a total of 4.33 percent of the vote.
The AL coalition won 46 percent of the vote in the legislative elections, taking 42 seats in the National Assembly. The FSLN garnered second place with 36.5 percent of the popular vote and 35 seats. Daniel Ortega Saavedra, who had been the FSLN'S presidential candidate, won one seat for a total of 36 seats for the FSLN. Most other parties fared poorly. The PCCN received a scant 3.7 percent of the vote and only four seats in the Assembly, including that of its presidential candidate