Thursday, December 12, 2013

God’s Gift to Nicaragua

In November 25-28, 2013, Mr. Samuel Santos Lopez, Nicaragua’s Foreign Minister embarked in a three days official visit to London UK, to promote his country’s stable economy, potential for growth, infrastructure development and favorable fiscal legislation to international investments. The Nicaraguan diplomat underlined the political stability, attractive set of labor laws, tax incentives and the comparative advantage that his country offers to British and European investors.

Daniel Ortega once said that God was punishing the United States with the financial crisis for trying to impose its economic principles on poor countries and said God was rewarding Nicaragua with an increase in GDP (PPP) to $2,600 per-capita from $1,800 a decade ago. For those on the left in the 1980s, the Sandinista Revolution was a beacon of hope, a shining light in the dark years or Thatcher and Reagan. Indeed, benefits did accrue to the poor such as the successful literacy progranmes.

Daniel Ortega, was a Sandinista rebel in Nicaragua and helped defeat the Somoza dictatorship who then went on to become a left-wing president who the Americans managed to dislodge by backing the Contra terrorists and blockading Nicaragua’s ports with mines. In 1986 the World Court did find the US guilty of the terrorist war, but the US simply refused to recognise the legitimacy of international law. Ortega is once again president but the radical reforms of the earlier Sandinista politics are long forgotten.

Ortega has announced that he's using his large majority in the national congress to go for reforms of 39 articles out of the 1995 Nicaraguan Constitution, which will considerably strengthen his hand. It eliminates the term limits, the ban on running for office more than two terms. He's already since violated that. But in addition to that, it allows military officers to serve in public office. It allows spying by internet companies on Nicaraguan communications.  He has turned to China with the idea of a $40 billion Nicaraguan Canal project. The China deal is a kind of a giveaway--it doesn't generate much revenue for Nicaragua, because the taxes on any income to the canal will be tax free, channeled through this offshore company. He signed a deal for the ambitious canal project with Wang Jing  CEO of Hong Kong Nicaragua Canal Development Investment Co. Ltd. (HKND), a mysterious new Chinese company that claims to be privately owned and independent of the Chinese government. But, as with virtually all Chinese companies, HKND remains opaque and refuses to reveal financial data, governing structure, and stock holdings. Nicaragua’s Ortega and Wang Jing are intent on portraying the new mammoth canal project as a purely commercial venture, with no connection to the Beijing regime. According to Bloomberg, Wang claimed “there is no relationship between HKND Group and the Chinese government.”

 Nicaragua is essentially giving more than $500 million a year in tax subsidies to corporate interests, and they allowed the business council to essentially write this law that was passed without any real discussion.  His allies the COSEP, which is the representatives of the largest business interests in the country--to get behind this dam and to help write this tax reform, which was basically a handout to capital and to upper-income groups.Nicaragua is a country with the second-lowest per capita income in Latin America.

They supported a ban on therapeutic abortions that have set back women's rights in 2006. In 2012 the government forced a 12-year old girl who had been raped and impregnated by her stepfather to remain under “state protection” in a Managua hospital until she gave birth. Sonia Castro, Nicaragua’s Minister of Health, even anointed herself “protector-in-chief,” making sure the child did not escape from the hospital. Since being reconciled with the Catholic Church, Ortega has become a strident opponent of abortion. In a country where the is 85% catholic it is always useful in elections to have blessing of the Church.

In another reconciliation, Ortega selected Jaime Morales Carazo, a former Contra leader and the godfather of former right-wing president Arnoldo Alemán's  children, as the FSLN's vice-presidential candidate. In fact, Ortega's current residence is a house confiscated from Carazo in the 1980s.  Salvador Talavera, the leader of the former Contra National Resistance Party  and also a National Assembly candidate for the right-wing Nicaraguan Liberal Alliance announced that he has made amends with Daniel Ortega and will support the FSLN. The FSLN's pact-making with the right-wing since its electoral defeat in 1990, as well as various corruption scandals (such as the so-called "piñata" of 1990, in which prominent officials personally seized various state assets before turning over power to the newly-elected government) led many of its prominent members to break with the party and form the Sandinista Renovation Movement (MRS). Ernesto Cardenal, a Catholic liberation theology priest and former Minister of Culture during the 1980s, argues that, "Daniel has deceived the leaders of the Latin American left, who think that he represents the left here. A vote for Daniel is a vote for Alemán.” Former President Arnoldo Alemán , was sentenced to 20 years in prison after being convicted of money laundering, embezzlement, and corruption. However, through his result  pact with the FSLN , he has been permitted to serve his sentence under house arrest at his private estate and is allowed to freely move about Managua. He also has extraditions for money-laundering charges pending in both the United States and Panama, but a Nicaraguan appeals court issued an injunction against Alemán's extradition

Ortega said that capitalism is in its "death throes" and the Bolivarian Alternative for the People of Our America (ALBA) is the most advanced, Christian and fairest project. Many accuse Ortega of building a family dynasty that they compare to the Somoza dictatorship, most notably by directing into their personal bank accounts all funds from ALBA.  Former member of the National Directorate of the FSLN and now National Assembly member of the MRS, Victor Hugo Tinoco, talks of a multi-million dollar resort and the enormous luxury Hotel Seminole that were bought with ALBA money.

Celebrity activist Bianca Jagger says of Ortega he “has become an autocrat. He has betrayed the aspirations of the people who fought so long and hard to free Nicaragua from the Somoza regime.”

His traditional caudillo style of leadership – a political strongman with a paternalistic but close relationship with the grassroots – has generated loyalty to him as a party figurehead and a sense that he is strong and powerful enough to get things done. But there are concerns that he and his government are growing more intolerant of criticism. Many were alarmed in June when the police stood idly by as a group of pro-government supporters violently broke up a demonstration in support of pension rights for the elderly.

Ortega has proved himself a political survivor. He took power after the Somoza dictatorship was toppled in 1979 and oversaw a government that introduced popular programmes for education, health and poverty alleviation. Despite losing elections in 1990, 1996 and 2001, he remained leader of his party and bounced back from several setbacks to secure another victory for the FSLN in 2007. Ortega remains popular. According to a CID-Gallup Latin America poll conducted in September, the FSLN was the most popular party on 52%, a long way ahead of any other parties. Free education, free healthcare and programs to improve homes have been gratefully received and for many people their continuation is a more immediate concern than constitutional reform.

Opponents say Ortega is repeating the mistakes of past leaders who ignored criticism and steadily built personal power. "With these constitutional reforms we're taking Nicaragua into another cycle of the violence we already know. Somoza did that and we know where he ended up," Eliseo Nuñez, an Independent Liberal party parliamentary representative, told Envio magazine. Critics said the state was being militarised and Ortega was strengthening his grip on power at the expense of neutral institutions and democratic opposition. The former Sandinista comandante Hugo Torres told the Guardian the army's efforts to professionalise could be undermined, leading it to become a repressive body at the service of the government.
"Ortega is attracting the army, flattering it through this reform by giving it a greater scope of action, allowing it more prerogatives, allowing it to interfere in the civil sphere," he said.

Adapted from here

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