Nicaragua New Bulletin: March 25, 2014

nicanetMarch 25, 2014

This weekly news bulletin is the successor to the Nicaragua News Service and Nicaragua Network Hotline. This publication may be reproduced in whole or in part. Please credit the Nicaragua Network.

  1. Stage set for election of high officials to expired offices
  2. Nicaragua makes progress toward Millennium Development Goals
  3. Banana workers again rebuffed by US court
  4. Russia and Nicaragua maintain strong relations
  5. Businesses react to minimum wage increase
  6. Tumarin construction logjam finally broken
  7. No incidents” between Nicaraguan and Colombian navies since World Court decision
  8. Economic shorts

1. Stage set for election of high officials to expired offices

The National Assembly formed a special committee to review the qualification of candidates for the Supreme Court, Supreme Electoral Tribunal, Superintendent of Banks, Attorney General’s Office, Human Rights Ombudsman’s Office, and other top government jobs that require election by the National Assembly. The committee was formed with 81 votes in the 91 member body, with two votes against and eight not voting. The special committee is comprised of three members of the FSLN and two members of the Independent Liberal Party (PLI). Some opposition legislators wanted to delay the appointment of the committee until after a dialogue between the administration and the Catholic Church hierarchy. Negotiations for a joint FSLN/PLI slate will be difficult. PLI vice-president and Deputy Alberto Lacayo called for a complete sweep of replacements for sitting officials.

[Ed. Note: The terms of most of these offices expired five years ago, but in President Daniel Ortega’s 2007-2011 term no party or combination of parties had the supermajority needed to elect their candidates to these offices. In order to prevent governmental paralysis, Pres. Ortega issued a decree allowing those holding the positions to continue to serve until the National Assembly elected their replacements. In Ortega’s second term, which began in 2012, the Sandinista Party (FSLN) holds a supermajority in the National Assembly and could have elected the constitutional and executive positions unilaterally, but decided to wait until it could partner with at least a portion of the opposition. The PLI is the second largest caucus in the Assembly.]

The number of positions to be elected is reported as 29, 34, 35, 54, and 60 in various media reports. Some of those numbers include officials who were elected in 2010. The special committee has 15 days to review the nominations. According to FSLN Deputy Wilfredo Navarro, third secretary of the Assembly Directorate, “We are going to have the election on the 9th or 10th of April come wind, rain, or shine.” FSLN Caucus director Dep. Edwin Castro said that the election will take place in a single session. Each candidate will be voted on one at a time and will need a 60% majority of 56 favorable votes to be elected. Supreme Electoral Council President Roberto Rivas is the main lightening rod for opposition wrath, including political parties, some civil society groups, and the Superior Council for Private Enterprise (COSEP). They blame Rivas for “irregularities” in prior elections in which the FSLN increasingly out polled the opposition. No announcement has been made about whether Rivas will be nominated to keep his job, or whether other officials will be re-nominated for theirs. The expectation is that the FSLN and PLI will present a united slate with each voting for the other’s nominees. (Radio La Primerisima, Mar. 20, 22; El Nuevo Diario, Mar. 19, 20, 21, 22, 23; La Prensa, Mar. 19, 20, 21, 22, 23, 24)

2. Nicaragua makes progress toward Millennium Development Goals

Nicaragua has made considerable progress, and is one of the leading countries in Latin America to achieve the United Nations Millennium Development Goals, for global poverty reduction such as reducing infant and maternal mortality and malnutrition, Presidential Advisor Paul Oquist said. He noted international recognition in the following areas:

  • The director general of the United Nations Food and Agriculture Organization (FAO), Graziano da Silva, recently acknowledged that the country has advanced substantially in reducing malnutrition by more than 50 percent. Oquist noted that Nicaragua has already complied with this Millennium development objective.
  • The World Parliamentary Union has recognized Nicaragua for superior progress in gender equality. The country is seventh in the world in the number of women in Parliament. It is expected to rise to second place in the world with the election of 2016, when the law will require that 50 percent of deputy candidates be women.
  • Nicaragua has also achieved the Millennium goal of reducing child mortality. Maternal mortality is now less than half of what it was at the beginning of the century.

Oquist also noted an increase in foreign direct investment, which has to do with an objective related to the Association for Development. These investments rose from $286 million in 2007 to more than $1.3 billion in 2013, thanks to the economic policies promoted by the Sandinista government. (Radio La Primerisima, Mar. 20)

3. Banana workers again rebuffed by US court

Former banana workers suffering sterility and other health problems attributed to the pesticide Nemagon, were dealt another legal setback, possibly the final one, in a US court on Mar. 7. The Los Angeles US Court of Appeals ruled unanimously in favor of Judge Victoria Chaney’s judgment that Dole Food Company is not liable for the illnesses. Humberto Hurtado, spokesperson for Dole, declared that the case known as “Tellez case” is “closed.” After an original court found Dole liable for damages, Dole brought its own case before Judge Chaney claiming fraud on the part of the plaintiffs and their lawyer. [Several Nicaraguans brought by Dole to testify later renounced their testimony saying Dole had promised them money and a US green card, but had not delivered.] Chaney ruled in favor of Dole, and that is the judgment affirmed by the Court of Appeals. Former banana workers have pursued this and other cases for over a decade, claiming that the pesticide, [whose sole purpose was to improve the appearance of bananas sold for export], caused severe health problems and birth defects both to workers and their families. Workers have marched twice from Chinandega to Managua and camped for several years in front of the National Assembly. After the election of President Daniel Ortega in 2006, the government built houses for the encamped banana workers and has covered their medical expenses and pensions. (La Prensa, Mar. 19; El Nuevo Diario, Mar. 19)

4. Russia and Nicaragua maintain strong relations

Russian Ambassador Nikolay Vladimir again affirmed that there are no negotiations between Russia and Nicaragua for a military base in Nicaragua. The ambassador made the statement at a ceremony on Wednesday in which Russia made a symbolic donation to the Nicaraguan Army to enable it to better alert the population and mitigate the effects of natural disasters. He also discussed possibly expanding the program to training and collaboration between Russian and Nicaragua seismology and meteorology experts. The donation was part of an agreement reached between the two countries in 2011 to help strengthen Nicaragua’s ability to respond to earthquakes, hurricanes and other natural disasters. The total agreement has been worth US$26.5 million to Nicaragua so far. That aid has included donating and equipping six field hospitals, 40 fire trucks, and 400 radios.

In another example of the good relations between Russia and Nicaragua, a delegation of the Tourism Institute (INTUR), ProNicaragua, and tour operators participated in Russia’s most important tourism event, the Moscow International Tourism Fair which ended Mar. 22. The Nicaraguan delegation promoted Nicaragua’s hotels, natural beauty, and culture. The Moscow fair has grown to be the world’s third largest with 90,000 visitors and 3,000 exhibitors. During the visit, a government delegation led by Laureno Ortega, head of ProNicaragua also met with Vice-Minister of the Treasury Sergei Ryabkov to discuss Russian investment in Nicaragua’s pharmacology, ground, and air transporation sectors as well as technical training. On Mar. 25 a delegation of three Russian parliamentarians arrived in Managua for friendship talks. (La Prensa, Mar. 19; El Nuevo Diario, Mar. 19, 24, 25; Radio La Primerisima, Mar. 19, 20, 24)

5. Businesses react to minimum wage increase

The Superior Council of Private Enterprise (COSEP) warned on March 20 that it is preparing an appeal against the required retroactivity to March 1 of the new minimum wage declared last week by the government. COSEP’s president stated that if a decision is made against the entrepreneurs, they will pursue recourse through the courts. Businesspeople assert that retroactivity goes against the law, and they have asked all companies not to pay the new minimum until March 15. Luis Barbosa, director of a Sandinista Workers’ Center (CST), said that all workers had been told that they would receive an increase as of March 1. “This is the result of an intransigent and arrogant position on the part of the president of COSEP, because he never showed up at the negotiating table.… We […] advised the workers that if businesses don’t pay them retroactively, as is ordered by ministerial resolution, that they denounce the companies before MITRAB (Ministry of Labor),” he said. According to Barbosa, businesses that don’t comply with retroactive pay could be sanctioned in a way he described as “very serious.” (El Nuevo Diario, Mar. 19, 20, 21; Radio La Primerisima, Mar. 20; La Prensa Mar. 19)

6. Tumarin construction logjam finally broken

The Sandinista government and Nicaraguan Hydroelectric Power (CHN) signed an agreement Friday evening to begin construction of the Tumarin hydroelectric megaproject within four months. The signing ceremony came less than six hours after presidential advisor Bayardo Arce gave the company a five day deadline to decide to go forward with the US$1.2 billion project on the Rio Grande de Matagalpa or lose its concession. CHN is a Brazilian consortium and Tumarin will provide 30% of Nicaragua’s power by 2018, raising the percentage of electricity generated in the country from renewable energy sources to over 80%. Nicaragua surpassed 50% renewable energy power generation in 2013, and along with other projects in the works, anticipates surpassing 90% in 2020. Minister of Finance Ivan Acosta called Tumerin “an important project for poverty reduction” and Minister of Energy and Mines Emilio Rappacciolli, noting that many families in rural areas do still not have access to electricity, said that now that situation “will change.”

Discussions over what CHN would charge for electricity had held up a final agreement since 2010, but Arce’s ultimatum spurred CHN to action. CHN President Marcelo Conde stated, “The final (electricity tariff) is not a necessary detail” before signing the agreement. Also holding things up has been the incomplete access road from San Pedro del Norte of which 27 km. have been built with 23 km. to go. Conde agreed the road is “passable.” Farmers in the Apawas region are still waiting to find out which of their lands will be affected by the project. In 2011, negotiations with the government and CHN achieved an agreement that those who lose land will be paid US$1,200 per acre. Construction will require 1,500 workers making a monthly salary of US$321. Benjamin Lanzas, president of the Chamber of Construction (CNC) stated that while the Brazilian company will need to hire some foreign companies with specialized skills, he expects 98% of the construction work to be done by Nicaraguan companies. (Radio La Primerisima, Mar. 22; El Nuevo Diario, Mar. 22, 23; La Prensa, Mar. 20, 22)

7. “No incidents” between Nicaraguan and Colombian navies since World Court decision

In response to Colombia adding a new warship patrolling territorial waters that Nicaragua was awarded by a World Court decision last year, Commander in Chief of the Nicaraguan Army, Julio Cesar Aviles, reiterated that Nicaragua exercises sovereignty over those waters. Colombia continues to reject the World Court ruling. The Nicaraguan navy and air force began patrolling waters awarded by the World Court on Nov. 19, 2013, six days after the court decision in which Colombia was awarded the islands of San Andres and Nicaragua was awarded the sovereignty of its continental shelf waters. The decision was important to defend Nicaraguan fishers’ right to fish in those waters and also to protect any potential oil deposits on the continental shelf. Aviles said, there “is a high level of communication” and that there have been “no incidents.” He said that Colombia had rescued four Nicaraguan fishers and that Nicaragua had rescued a Colombian boat. “They are in their waters and we are in ours and there is a good level of permanent communication between our naval force and the chief of the Colombian navy,” Aviles stated. (El Nuevo Diario, Mar. 19, 20; La Prensa, Mar. 19)

8. Economic Shorts

Three Nicaraguan companies signed an agreement with the Nicaraguan Association of Producers and Exporters (APEN) to establish a strategy to increase the income of women producers of organic tea and achieve higher productivity of cold milk and doughnuts for export. In total, 114 rural women will benefit from the project which was established to promote gender equality funded by the European Union. (El Nuevo Diario, Mar. 21)

Four electric plants owned by Ashmore Energy International Power, Ltd. were sold last week to an Israeli company, IC Power. Two wind farms in Rivas have a capacity to produce 63 megavolts of electricity while the two other plants in Tipitapa and Corinto, both which generate electricity from geothermal sources, have the capacity to produce 51 and 71 mv, respectively.

Exports in January grew by 1.8% over the previous year according to the Nicaragua Central Bank (BCN). Total exports exceeded US$221 million with sugar, beef, gold, coffee, and milk products accounting for 60% of the total. International markets prices have improved with coffee seeing a 16.7% increase over December 2013. The BCN said manufactured textile products were the best economic dynamo during the month. (Radio La Primerisima, Mar. 22)

The economy as a whole grew by 4.6% in January compared to the previous January. This includes both exports, domestic production, financial, commercial and service industries. Annual growth in 2013 was 4.6%. (Radio La Primerisima, Mar. 19)

Loans for the livestock sector were the fastest growing sector of the finance industry last year with 35% growth. The Local Development Fund (FDL) plans to loan at least US$9.9 million this year to livestock producers. Loans to the agricultural sector grew by 9.6%. Everth Hernandez, business manager for FDL said the fund would increase its loan portfolio by 30% this year with strong attention to the livestock industry. In order to provide technical training and help increase productivity, FDL has entered into strategic alliances with Institute of Development and Investigation (NITLAPAN) of the University of Central America and Technoserve among others. “Our goal is to attend to at least 5,000 farmers this year,” Hernandez said. ( El Nuevo Diario, Mar. 25)

The number of tourist businesses in the “coffee route” have grown from 569 in 2007 to 1,523 today. The “coffee route” is the planned area of tourism development in the departments of Nueva Segovia, Esteli, Jinotega, Madriz, and Matagalpa. From 2,639 jobs in 2007, the coffee route tourist industry now employs 6,490 of which 64% are women. (Radio La Primerisima, Mar. 19; El Nuevo Diario, Mar. 19)