Nicanet - The Nicaragua Network

Nicaragua Network Hotlines for March 6, 2007

News topics covered in this Hotline include:

Topic 1: Ortega and journalists: Some sign agreement others reject president’s offer

The Nicaraguan Journalists Association (APN) celebrated National Journalists’ Day with a protest on March 1st against what they consider to be economic pressures from President Daniel Ortega and the Sandinista government which threaten their journalistic freedom as well as increase economic and social uncertainty for reporters. Forty journalists marched through the west side of the capital with a coffin containing one of their colleagues who had a blanket draped over him that said: "Neither a free person nor a free society can exist without freedom of expression and freedom of the press."

The APN claims that first lady Rosario Murillo, head of the National Council for Citizenship and Communication, intends to manipulate the national publications budget in a way that favors those journalists and other mass media who are supporters of the present administration and its policies. [In Nicaragua, government announcements are a large part of the advertising income of newspapers; therefore the possibility that an administration might choose where to place announcements based on political affiliation is seen as threatening.]

The Chamorro government’s manipulation of government advertising and social security tax collection caused the bankruptcy and closure of Barricada, the Sandinista party newspaper. It is ironic that neither the FSLN nor the Constitutional Liberal Party (PLC), the two largest political parties, has its own newspaper. La Prensa is seen as aligned with the National Liberal Alliance/Conservative Party (ALN- PC) and El Nuevo Diario now with the Sandinista Renovation Movement (MRS). Both major Nicaraguan dailies are hostile to the so-called “parties of the pact,” the FSLN and the PLC.

Ortega signed a 12 point agreement with another union, the Nicaraguan Journalists Society (CPN) committing to “a just distribution among the publications so that they can provide information about what the government is doing."

Vice-president of the APN Efraín Payá stated that his association rejected the agreement because "It’s a vindictive agreement which does not include a commitment from the government to respect freedom of expression nor does it include a promise by Sandinista members of the National Assembly to vote for the Access to Information Act, currently stuck in the legislative process.”

Murillo, for her part, stated in a letter to journalists that the new communications policies mark the end of "a system that privileged special interest groups and gave benefits to the large media monopolies and communications conglomerates, which do not understand ethics or social responsibility."


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Topic 2: Economic ties between Venezuela and Nicaragua advance

 The Nicaraguan Superintendent of Banks (SIB) in January gave the green light for the Venezuelan National Social and Economic Development Bank (BANDES) to open a branch office in the country. On March 2nd four BANDES executives arrived in the country to stay until the Managua central office is up and running. Venezuelan Ambassador Miguel Gómez explained that in Nicaragua, BANDES will only be offering loans to small and medium sized farmers, businesses, cooperatives and groups seeking loans in the areas of transportation and housing construction.

In other news, on March 4th, part of an 85 member delegation from Venezuela began functioning as a multidisciplinary commission in charge of implementing, along with Nicaraguan counterparts, the 15 bilateral trade agreements signed by the two countries under the framework of the Bolivarian Alternative for the Americas (ALBA). It was possible that Venezuelan President Hugo Chávez will join the delegation on Tuesday, March 6th; however, this had not yet been confirmed.

The bilateral cooperation project will provide more than US$600 million for electric power, medicine and medical attention, housing construction, training and education, among other things. Three of the most noteworthy points of the agreements are the delivery, on the part of Venezuela, of 32 electrical plants with the capacity to generate 60 megawatts in order to help Nicaragua solve its energy deficit, the provision of 10,000 barrels daily of refined petroleum at preferential prices and finally the construction of an oil refinery with the capacity to process between 100,000 to 150,000 barrels of crude per day.


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Topic 3: Nicaragua and Honduras dispute maritime rights before the World Court


March 5th marked the first day of public arguments by Nicaragua and Honduras before the International Court of Justice (ICJ), also known as the World Court, in the litigation regarding maritime rights that both countries claim in the Caribbean. In this case, the World Court will determine the maritime boundaries between the two countries along with the exclusive economic zone in the Caribbean that corresponds to each of the countries. Currently Nicaragua alleges that its territory begins at the 17th parallel while Honduras argues that a preexisting border line was set at a point at the mouth of the Coco River and extends along the 15th parallel. Between them is the maritime zone claimed by both nations.

Under dispute is some 60,000 square kilometers of continental shelf with great marine wealth, where it is said that an important oil potential could exist, in addition to the natural ocean resources. Also within this area is a group of small island chains that will be disputed in the case.

Nicaragua said that Honduras’ position in the matter has caused “repeated confrontations” between both nations and that the bilateral diplomatic negotiations to resolve the issue have failed. The affair began after the Honduran Congress approved on November 30, 1999, a maritime boundary agreement with Colombia that Nicaragua considered detrimental to its sovereignty. This is the final stage of the process and a ruling by the court is expected before mid June if not sooner.


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Topic 4: Union FENOSA conflict now includes World Bank and Spanish Embassy


Joseph Owen, World Bank (WB) representative in Nicaragua, urged the government and the Spanish transnational company Union FENOSA to reach a settlement to avoid a payout on a US$53 million insurance policy which UNION FENOSA is currently demanding.

Owen confirmed that officials from the Multilateral Investment Guarantee Agency (MIGA), a World Bank agency, have met with both parties to look for solutions that do not require the multimillion dollar payout for a supposed “expropriation” by the government which alleges that FENOSA has not fulfilled its part of the contract regarding the distribution of electricity. Although no specifics were revealed, it appears that if FENOSA does enter a claim on the policy, the Nicaraguan government is legally bound to reimburse MIGA whatever amount MIGA pays out. This is one more example of how the free trade regimen of neo-liberal economics is really a “no risk” policy for transnational capital.

The Nicaraguan government continues to insist that Union FENOSA violated the contract it signed in 2000 by failing to invest in the areas agreed upon as well as neglecting the proceedings for arbitration initiated last year as a possible solution to the current conflict. Instead the company sought backing from the World Bank. FENOSA owes more than US$20 million to energy generating companies. But FENOSA officials claim multimillion dollar losses due to the supposed “electrical fraud” committed by large consumers and thousands of marginalized barrio dwellers who connect illegally to the system without paying. For the last few weeks rolling blackouts have increased due to energy plants going out of service because of rumors that FENOSA was not going to pay the generating companies.

President Ortega created some turmoil, protesting that FENOSA sought to apply pressure using the Spanish Embassy which he stated conditioned Spanish economic assistance to a favorable outcome in the matter with FENOSA. Spanish ambassador Jaime Lacadena denied any such conditioning noting that he was surprised and offended by Ortega’s comments.

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Topic 5: Daniel Ortega asks for help to build classrooms


On February 28, President Daniel Ortega asked businesspeople and investors in Nicaragua to assist in efforts to build classrooms and schools in order to fill the infrastructure deficit in Nicaragua’s educational system. Ortega said that the greatest difficulties would come when the rainy season began (usually in May) because the tents that had been set up at many schools to house the influx of students would not be able to withstand the downpours of those months. “I ask investors who are here in the country to help if they have a school nearby,” Ortega said, adding that they can repair a school or, if children are studying in a tent, they can help build one simple classroom. He noted that the country is short 300 schools.

The President said that he intended to ask for the assistance of the European Union, the United States and Venezuela in the building of new schools. He also said that the Minister of Transportation had ordered workers who are carrying out road repair projects to help repair schools along the highways.

The classroom crisis has been a result of the abrupt ending of what was known as the “school autonomy” program, a requirement of the IMF and World Bank for Nicaragua to receive debt relief under the Heavily Indebted Poor Countries (HIPC) initiative. “School autonomy” was a “cost recovery” program in which only about half of the cost of running Nicaragua’s public primary and secondary schools was provided by the central government. Remaining funding had to be raised by the teachers from the mostly poor parents. Many parents kept their children out of school until the program was ended by new education Minister Miguel de Castilla when he took office on January 11 of this year.

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 This hotline is prepared from the Nicaragua News Service and other sources. To receive a more extensive weekly summary of the news from Nicaragua by e-mail or postal service, send a check for $60.00 to Nicaragua Network, 1247 E St., SE, Washington, DC 20003. We can be reached by phone at 202-544-9355.