Nicanet - The Nicaragua Network

Nicaragua Network Hotlines for March 27, 2007

News topics covered in this Hotline include:

Topic 1: International Water Day celebration reveals the crisis facing Nicaragua


More than a celebration, the International Water Day in Nicaragua has become a special day to denounce the contamination, increasing scarcity, and lack of access to water as well as the shortage of public policies to preserve the reservoirs of the vital liquid. Nelson Artola, executive director of the Social Emergency Investment Fund of (FISE), called the situation in which Nicaraguans live as "disastrous" with respect to their sanitary services and potable water. He provided El Nuevo Diario with some basic data:

• More than half of Nicaraguans do not have access to basic services for drinking water.
• 70 percent of the rural population does not have access to safe drinking water.
• 3 million Nicaraguans satisfy their needs for water from contaminated ponds and rivers, which spreads illness.

On March 22 the Association of Municipalities of the Great Lake and River San Juan Basin (AMUCRISAN), consisting of the 36 municipalities that border Lake Cocibolca (Lake Nicaragua) and the San Juan River, held a forum in Granada to shed light on the crisis of the largest water reserve in Nicaragua. In Managua the National Aqueducts and Sewage Company (ENACAL) also had a forum to celebrate International Water Day among whose guests were government officials such as the Minister of Natural Resources and the Environment (MARENA) as well as Vice President Jaime Morales.

In the rest of the country, consumer organizations and community movements are calling for protests against ENACAL for lack of services and claim that "Many neighborhoods only know ENACAL from the bill they send each month, despite the fact that the water is not a constant presence in their homes, and the pipes are only decorations for their counter tops."

To add to the mixed messages, the Constitutional Liberal Party (PLC) and National Liberal Alliance (ALN) blocked final passage of the National Water Bill which the Sandinista government submitted as an “urgent” bill more than 60 days ago. The new law would create authorization for ENACAL to seek funding to better infrastructure and to establish regulations for private companies. The PLC and ALN claimed they "are not familiar with the motions and amendments to the bill." The previous government was in the process of gutting the state-owned company in preparation to privatize it. There is suspicion that the PLC and ALN are being influenced by potential buyers and the US, IMF, and World Bank for which privatization of public services has gained the status of religious dogma.

In an attempt to offer some short term immediate solutions, FISE announced that it will initiate 117 water and sanitation projects this year in 52 municipalities with an estimated total of 115,992 people benefited. The municipalities chosen are in the category of "extreme poverty." The FISE will invest more than US$6.75 million using funds from the Inter-American Development Bank (IDB) and Swiss Development Cooperation, among other institutions.

The Sandinista government also sent, as a decree, to the National Assembly a project for US$30 million to improve potable water and sanitation services in municipalities across the country, also with financing of the IDB. ENACAL will oversee the project. The objective of the project is to eliminate or reduce the water rationing affecting more than 300,000 people, according to the decree. The program will finance work to modernize and rehabilitate both the drinking water and sewer systems starting with the municipality of Masaya.

There was no word, however, on a plan to clean up Lake Cocibolca, Nicaragua’s largest fresh water resource. An investigation, carried out by the Department of Environment and Natural Resources along the waters that border Nicaraguan communities, determined four years ago that due to contamination the water was not fit for consumption, irrigation or recreational activities.


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Topic 2: INE sends FENOSA case to arbitrator with a multimillion dollar sum in the balance

 On March 23 the Nicaraguan Energy Institute (INE) presented to a court of arbitration a multimillion dollar demand against Union Fenosa, the Spanish transnational distributor of electrical power for the country. The executive president of INE, regulating entity for the energy sector, explained that the demand contains six points in which Union Fenosa has not complied with the contract for the concession made to distribute electrical power. The move is a strategy to forestall Union Fenosa’s attempt to collect on a multi-million dollar World Bank insurance policy, the pay-out of which would be passed on to Nicaragua.

The president of the INE detailed the points of the demand:

*Issue a full refund to customers who were illegally charged for electric services that did not exist.
*Return all expired deposits to the companies that generate electricity and cancel all debts in order to put an end to energy rationing.
*Apply discount rates for the poor quality of service rendered in 2005, a cost of almost US$2.5 million.
*Repay US$2.5 million for energy rationings during April and May of 2006.
*Provide maintenance to the power grid, something it has not done, resulting in many accidents, some of which have been fatal.
*Do an analysis of INE’s method of calculating the difference between the price for fuel approved by INE in order to set rates and the real price of what it costs to generate the energy.

Union Fenosa has ten days to respond to the demands. The arbitration panel then has 30 days to clarify the issues, seek more information, and issue a judgment. If INE wins the case, which is legally binding, FENOSA will have to return a multimillion dollar sum; however, the total has not been specified. The president of INE also commented that he expects that the Multilateral Investment Guarantee Agency (MIGA), an extension of the World Bank, will not take any action until the arbitration has been completed, as established in the contract signed five years ago between FENOSA and MIGA.



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Topic 3: Nicaraguan relations with China and Taiwan


Minister of Foreign Affairs Samuel Santos suspended "temporarily" his official visit to Taiwan scheduled for the end of March. Unofficially it is known that there is concern in Taiwan regarding suspension of the visit in light of the growing commercial relations between Nicaraguan and Chinese businesses. Strong diplomatic bonds between Nicaragua and Taiwan grew during the US-backed neoliberal governments of the past 17 years. The signing of a memorandum of understanding with Taiwan for a number of cooperation projects by President Daniel Ortega shortly after taking office///,/// caused objections by the Chinese government which demanded to be recognized as the only legitimate representative of the Chinese people with a recognition that Taiwan is a province of China.

According to Bayardo Arce, economic advisor to Ortega, Nicaragua and China have no official relationship and the Nicaraguan government is not in any hurry to re-establish the diplomatic relations with the Peoples Republic of China. "The Chinese problem is not a Nicaraguan problem, but nor does it impede us from maintaining friendly relations between countries."

Taiwan, through the International Cooperation and Development Fund of Taiwan (ICDF) gave US$10 million for projects to alleviate poverty in Honduras and Nicaragua. The loan was signed by ICDF representatives for Taiwan and as well as the Central American Bank for Economic Integration (BCIE), which will channel the resources to the two countries.



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Topic 4: Cuba, Venezuela, Bolivia and Nicaragua create alliances for mining industry

The "First Conference for Geology and Mining Industry Integration in the ALBA countries," took place in Cuba on March 20 thru 23. Ministers for the Mining and Energy Industries from Bolivia, Nicaragua, Cuba and the Venezuelan Vice-Minister of Mining agreed on the creation of a "mining alliance" under the auspices of the Bolivarian Alternative for the Americas (ALBA) to be signed at the end of April by the presidents of the respective countries. The ministers agreed to undertake joint actions to standardize knowledge and formats, the lack of which complicates creation of strategies for sustainable development, mining promotion, territorial classification, environmental devastation and disaster prevention.

In order to satisfy the human resource development needs required for there to be progress in the geology and mining industries, the participants created a multidisciplinary work group that will meet for the first time on April 15 in Venezuela. On the agenda are studies of the different mining laws, the creation of a common data bank of geology data, potential mineral resources evaluation, market studies, project elaboration for the transformation of the mining industry, the establishment of a network of geological and mineralogical laboratories and the creation of a system responsible for the formation and training of personnel.

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Topic 5: Upcoming Latin America Solidarity Actions


The National Network on Cuba, Venezuela Solidarity Network and many other co-sponsors are organizing Hands Off Cuba, Venezuela, and Bolivia demonstrations in New York City (April 7) and Los Angeles on April 8. The New York demonstration will include a march from Bryant Park to the New York Times headquarters and then to Central Park where a rally will be held near the statues of Simon Bolivar and Jose Marti. A reception at SEIU Local 1199 will be held with demonstrators and diplomats of the three countries. In Los Angeles a demonstration will take place in Hollywood at the location where movie stars get their “star.” Participants will symbolically place stars for the leaders and the people of the two countries. Visit www.April7Coalition.org for details.

The following weekend, April 13-15, the Latin America Solidarity Coalition (LASC) will hold a conference “Alternatives to Empire.” Saturday morning the conference will join the Coalition of Immokalee Workers whose successful boycott against Taco Bell helped raise the wages of tomato pickers. They will be launching their boycott of McDonalds in Chicago that weekend. The LASC conference will include plenaries and workshops on a full range of issues and campaigns related to Latin America and US solidarity. For details and to register, visit www.LAsolidarity.org.

The Nicaragua Network is organizing a conference in Managua, Nicaragua July 13-15 called “Solidarity Resurgent” in which Nicaraguans and US activists will share information and strategies affecting our work in light of the new Sandinista government and the rise of the Left through much of Latin America. The Nicaragua Network is also organizing a delegation from July 16-22 to visit community-based alternative development projects, celebrate the 28th anniversary of the triumph of the Sandinista Revolution, and to talk with government officials and popular movements about changes likely under the new government. Visit www.nicanet.org for details and registration forms.

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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.