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Nicaragua is spiraling toward collapse. New U.S. sanctions will speed up the process

A Nicaraguan flag flying over a traffic circle that was the site of numerous opposition rallies, and where paramilitaries painted over antigovernment graffiti along the street, in Managua, Nicaragua, Dec. 21, 2018. When huge protests demanded that he leave office, President Daniel Ortegas days seemed numbered. But his repressive response has sent thousands into hiding and tightened his hold on power. (Meridith Kohut/The New York Times)
A Nicaraguan flag flying over a traffic circle that was the site of numerous opposition rallies, and where paramilitaries painted over antigovernment graffiti along the street, in Managua, Nicaragua, Dec. 21, 2018. When huge protests demanded that he leave office, President Daniel Ortegas days seemed numbered. But his repressive response has sent thousands into hiding and tightened his hold on power. (Meridith Kohut/The New York Times) NYT

When I asked Nicaraguan President Daniel Ortega in a recent interview how he feels when people call him a dictator, he shrugged and responded (stone-faced) that, “I have learned not to be bothered by lies.”

But his latest actions against Nicaragua’s free press show that those who call him a dictator may not be lying.

On Dec. 14, Ortega’s police raided the offices of Nicaragua’s best-known independent journalist, Carlos Fernando Chamorro, editor of the weekly Confidencial and host of the television show Esta Semana – “This Week.” The police stormed into the building without a court order and took with them computers, pen drives and private documents, Chamorro said.

“They are still occupying the building,” Chamorro told me four days after the raid. “It was an illegal action that violated freedom of the press, private property and free enterprise.”

Chamorro’s offices were among more than half a dozen others – including the Nicaraguan Center for Human Rights and the Institute for the Development of Democracy – that were raided by Ortega’s police forces at the same time.

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Most of them belong to non-governmental groups that have raised their voices against the Ortega regime because of its repression of anti-government protests, which have left at least 325 dead since April.

The protesters were demanding Ortega’s resignation. He has been in power since 2007 and – following the steps of late Venezuelan strongman Hugo Chavez – has co-opted all independent institutions. Ortega now holds near absolute powers, and his latest re-election was highly questionable.

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Andres Oppenheimer

The new wave of repression against independent institutions will almost certainly worsen Nicaragua’s political and economic crisis.

Contrary to Ortega’s claim in our July 28 interview at his residence in Managua that the country’s economy was heading toward total “normalization” after the massive protests earlier in the year, Nicaragua is rapidly descending into economic collapse.

According to the Nicaragua Foundation for Economic and Social Development (FUNIDES,) a private-sector economic think tank, Nicaragua’s economy – which was projected to grow by 5 percent before April’s protests – will end 2018 with a negative growth rate of 4 percent. In 2019, the economy is expected to fall further, to a negative growth rate of between 7 percent and 10 percent, according to the think tank.

About 120,000 Nicaraguans have lost their jobs since April – nearly 20 percent of the country’s workforce. That figure could double next year, FUNIDES says. Growing numbers of Nicaraguans are fleeing abroad, including an estimated 50,000 who have already moved to Costa Rica.

FUNIDES president Juan Sebastian Chamorro, a cousin of Confidencial’s publisher, told me that the Trump administration’s latest sanctions against Nicaragua will accelerate the country’s economic demise.

In addition to the United States’ individual sanctions against top Nicaraguan officials involved in human-rights violations under the Magnitsky Act, the U.S. Congress earlier this month passed the so-called “Nica Act” bill aimed at curtailing loans to Nicaragua by international financial institutions such as the World Bank and the Inter-American Development Bank. Trump is expected to sign the bill into law shortly.

Nicaragua’s business community, which until recently was in cahoots with the Ortega regime and opposed U.S. sanctions, is now supporting them. Growing numbers of business people agree that unless Ortega feels U.S. and international pressure to negotiate a deal with the opposition that could lead to early elections and an economic recovery, Ortega will cling to power indefinitely.

“Nicaragua is a very different country than Venezuela. We have no oil, and we are heavily dependent on foreign loans and private sector investments,” FUNIDES’ president Chamorro told me. He added that U.S. sanctions may trigger internal pressures within the government to seek a negotiated solution with the opposition.

That’s possible. But, judging from Ortega’s stone face when I asked him being called a dictator, I suspect that it will take some time – and many hardships – to convince him to negotiate a political agreement that could lead to free elections and get the country back on its feet.

Before things start getting better in Nicaragua, they’re likely to get much worse.

Andres Oppenheimer is a Latin America correspondent for the Miami Herald, 3511 N.W. 91 Avenue, Doral, Fla. 33172; email: aoppenheimer@miamiherald.com.
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