U.S. DEPARTMENT OF STATE
BACKGROUND NOTES: NICARAGUA, MARCH 1998
RELEASED BY THE BUREAU OF INTER-AMERICAN AFFAIRS
Area: 130,688 sq. km. (50,446 sq. mi.); slightly larger than New York
Cities: Capital--Managua (pop. 1 million). Other cities--Leon, Granada,
Jinotega, Matagalpa, Chinandega, Masaya.
Terrain: Extensive Atlantic coastal plains rising to central interior
mountains; narrow Pacific coastal plain interrupted by volcanoes.
Climate: Tropical in lowlands, cooler in highlands.
Nationality: Noun and adjective--Nicaraguan(s).
Population: 4.48 million.
Annual growth rate (1995): 2.9. Density: 33 per sq. km.
Ethnic groups: Mestizo (mixed European and indigenous) 69%, white 17%,
black (Jamaican origin) 9%, indigenous 5%.
Religion: Roman Catholic 85%.
Languages: Spanish (official), English and indigenous languages on
Education: Years compulsory--none enforced (28% 1st graders eventually
finish 6th grade). Literacy--75%.
Health: Life expectancy--62 yrs. Infant mortality rate--50/1,000.
Work force (1996): 1.7 million. Unemployed--16%. Underemployed--36%.
Constitution: The 1995 reforms to the 1987 Sandinista-era Constitution
provide for a more even distribution of power among the four branches of
Branches: Executive--president and vice president. Legislative--National
Assembly (unicameral). Judicial--Supreme Court; subordinate appeals,
district and local courts; separate labor and administrative tribunals.
Electoral--Supreme Electoral Council, responsible for organizing and
Administrative subdivisions: 15 departments and two autonomous regions
on the Atlantic coast; 145 municipalities.
Major political parties: Liberal Alliance (AL), Sandinista National
Liberation Front (FSLN)
Suffrage: Universal at 16.
GDP (1996): $2.3 billion.
Annual growth rate (1997): 5.0%.
Per capita GDP: $452.
Inflation rate: 12%.
Natural resources: Arable land, livestock, fisheries, gold, timber.
Agriculture (35% of GDP): Products--corn, coffee, sugar, meat, rice,
Industry (20% of GDP): Types--processed food, beverages, textiles,
petroleum, and metal products.
Services (45% of GDP): Types--commerce, construction, government,
banking, transportation, and energy.
Trade (1996): Exports--$671 million (FOB): coffee, seafood, beef,
sugar, industrial goods, gold, bananas, sesame. Markets--U.S. 43%,
European Union 33%, Central American Common Market (CACM) 17%, Mexico
2%. Imports--$1,024 million (FOB): petroleum, agricultural supplies,
manufactured goods. Suppliers--U.S. 32%, CACM 21%, Venezuela 11%,
European Union 9%.
Exchange rate (1997): Nicaraguan cordobas 9.470=U.S. $1.
Most Nicaraguans have both European and Indian ancestry, and the culture
of the country reflects the Ibero-European and Indian heritage of its
people. Only the Indians of the eastern half of the country remain
ethnically distinct and retain tribal customs and languages. A large
black minority (of Jamaican origin) is concentrated on the Caribbean
coast. In the mid-1980s, the central government divided the eastern half
of the country--the former department of Zelaya--into two autonomous
regions and granted the people of the region limited self-rule. The 1995
constitutional reform guaranteed the integrity of the regions' several
unique cultures, and gave the inhabitants a say in the use of the area's
natural resources. Roman Catholicism is the major religion, but
Evangelical Protestant groups have grown recently, and there are strong
Anglican and Moravian communities on the Caribbean coast. Most
Nicaraguans live in the Pacific lowlands and the adjacent interior
highlands. The population is 54% urban.
Nicaragua takes its name from Nicarao, chief of the indigenous tribe
then living around present-day Lake Nicaragua. In 1524, Hernandez de
Cordoba founded the first Spanish permanent settlements in the region,
including two of Nicaragua's two principal towns: Granada on Lake
Nicaragua and Leon east of Lake Managua. Nicaragua gained independence
from Spain in 1821, briefly becoming a part of the Mexican Empire and
then a member of a federation of independent Central American provinces.
In 1838, Nicaragua became an independent republic.
Much of Nicaragua's politics since independence has been characterized
by the rivalry between the Liberal elite of Leon and the Conservative
elite of Granada, which often spilled into civil war. Initially invited
by the Liberals in 1855 to join their struggle against the
Conservatives, an American named William Walker and his "filibusters"
seized the presidency in 1856. The Liberals and Conservatives united to
drive him out of office in 1857, after which a period of three decades
of Conservative rule ensued.
Taking advantage of divisions within the Conservative ranks, Jose Santos
Zelaya led a Liberal revolt that brought him to power in 1893. Zelaya
ended the long-standing dispute with Britain over the Atlantic Coast in
1894, and reincorporated that region into Nicaragua. However, due to
differences over an isthmian canal and concessions to Americans in
Nicaragua as well as a concern for what was perceived as Nicaragua's
destabilizing influence in the region, in 1909 the United States
provided political support to Conservative-led forces rebelling against
President Zelaya and intervened militarily to protect American lives and
property. Zelaya resigned later that year. With the exception of a nine-
month period in 1925-26, the United States maintained troops in
Nicaragua from 1912 until 1933. From 1927-1933, U.S. marines stationed
in Nicaragua engaged in a running battle with rebel forces led by
renegade Liberal general Augusto Sandino, who rejected a 1927 negotiated
agreement brokered by the United States to end the latest round of
fighting between Liberals and Conservatives.
After the departure of U.S. troops, National Guard Commander Anastasio
Somoza Garcia outmaneuvered his political opponents, including Sandino,
who was assassinated by National Guard officers, and took over the
presidency in 1936. Somoza, and two sons who succeeded him, maintained
close ties with the U.S. The Somoza dynasty ended in 1979 with a massive
uprising led by the Sandinista National Liberation Front (FSLN), which
since the early 1960s had conducted a low-scale guerrilla war against
the Somoza regime.
The FSLN established an authoritarian dictatorship soon after taking
power. U.S.-Nicaraguan relations deteriorated rapidly as the regime
nationalized many private industries, confiscated private property,
supported Central American guerrilla movements, and maintained links to
international terrorists. The United States suspended aid to Nicaragua
in 1981. The Reagan Administration provided assistance to the Nicaraguan
Resistance and in 1985 imposed an embargo on U.S.-Nicaraguan trade.
In response to both domestic and international pressure, the Sandinista
regime entered into negotiations with the Nicaraguan Resistance and
agreed to nationwide elections in February 1990. In these elections,
which were proclaimed free and fair by international observers,
Nicaraguan voters elected as their president the candidate of the
National Opposition Union, Violeta Barrios de Chamorro.
During President Chamorro's nearly seven years in office, her government
achieved major progress toward consolidating democratic institutions,
advancing national reconciliation, stabilizing the economy, privatizing
state-owned enterprises, and reducing human rights violations. In
February 1995, Sandinista Popular Army Commander General Humberto Ortega
was replaced, in accordance with a new Military Code enacted in 1994, by
General Joaquin Cuadra, who has espoused a policy of greater
professionalism in the renamed Army of Nicaragua. A new police
organization law, passed by the National Assembly and signed into law in
August 1996, further codified both civilian control of the police and
the professionalization of that law enforcement agency.
The October 20, 1996 presidential, legislative, and mayoral elections
were also judged free and fair by international observers and by the
ground-breaking national electoral observer group "Etica y
Transparencia" (Ethics and Transparency) despite a number of
irregularities, due largely to logistical difficulties and a baroquely
complicated electoral law. This time Nicaraguans elected former-Managua
Mayor Arnoldo Aleman, leader of the center-right Liberal Alliance. More
than 76% of Nicaragua's 2.4 million eligible voters participated in the
elections. The first transfer of power in recent Nicaraguan history from
one democratically elected president to another took place on January
10, 1997, when the Aleman government was inaugurated.
GOVERNMENT AND POLITICAL CONDITIONS
Nicaragua is a constitutional democracy with executive, legislative,
judicial, and electoral branches of government. In 1995, the executive
and legislative branches negotiated a reform of the 1987 Sandinista
constitution which gave impressive new powers and independence to the
legislature--the National Assembly--including permitting the Assembly to
override a presidential veto with a simple majority vote and eliminating
the president's ability to pocket veto a bill. Both the president and
the members of the unicameral National Assembly are elected to
concurrent five-year terms. The National Assembly consists of 90
deputies elected from party lists drawn at the department and national
level, plus the defeated presidential candidates who obtained a minimal
quotient of votes. In the 1996 elections, the Liberal Alliance won a
plurality of 42 seats, the FSLN won 36 seats, and nine other political
parties and alliances won the remaining 15 seats.
The Supreme Court supervises the functioning of the still largely
ineffective and overburdened judicial system. As part of the 1995
constitutional reforms, the independence of the Supreme Court was
strengthened by increasing the number of magistrates from 9 to 12.
Supreme Court justices are elected to seven-year terms by the National
Led by a council of five magistrates, the Supreme Electoral Council is
the co-equal branch of government responsible for organizing and
conducting elections, plebiscites and referendums. The magistrates and
their alternates are elected to five-year terms by the National
Freedom of speech is a right guaranteed by the Nicaraguan constitution
and vigorously exercised by its people. Diverse viewpoints are freely
and openly discussed in the media and in academia. There is no state
censorship in Nicaragua.
Other constitutional freedoms include peaceful assembly and association,
freedom of religion, and freedom of movement within the country, as well
as foreign travel, emigration, and repatriation. The government also
permits domestic and international human rights monitors to operate
freely in Nicaragua. The constitution prohibits discrimination based on
birth, nationality, political belief, race, gender, language, religion,
opinion, national origin, economic condition, or social condition. All
public and private sector workers, except the military and the police,
are entitled to form and join unions of their own choosing, and they
exercise this right extensively. Nearly half of Nicaragua's work force,
including agricultural workers, is unionized. Workers have the right to
strike. Collective bargaining is becoming more common in the private
In all, Nicaragua's 35 political parties participated in the 1996
elections, independently or as part of one of five electoral coalitions.
With nearly 52% of the vote, the Liberal Alliance, a coalition of five
political parties and sectors of another two, won the presidency, a
plurality in the national legislature and a large majority of the
mayoral races. The FSLN ended in second place with 38%.
Most other parties fared poorly. A new political party, the Nicaraguan
Christian Path, ended a distant third with 4% of the vote and four seats
in the 93-member National Assembly. The traditional alternative to the
Liberals, the National Conservative Party, ended in fourth place with
slightly over 2% of the vote and three seats in the National Assembly.
The remaining 24 parties and alliances together obtained less than 5% of
the vote. Seven of these smaller parties control eight seats in the
National Assembly. Only two of 145 mayors belong to third parties.
According to Nicaraguan law, those political parties that did not win at
least one seat in the National Legislature automatically lose their
legal status and must repay government campaign financing. There are 19
parties represented in the National Assembly independently or as part of
Principal Government Officials
Vice President--Enrique Bolanos
Foreign Affairs Minister--Emilio Alvarez Montalvan
Finance Minister--Esteban Duque Estrada
Economy Minister-Noel Sacasa
Central Bank Minister--Noel Ramirez
Government Minister--Jose Antonio Alvarado
Agriculture Minister--Mario De Franco
Defense Minister--Jaime Cuadra
Construction and Transportation Minister--Edgard Quintana
Health Minister--Carlos Quinonez
Education Minister--Humberto Belli
Attorney General--Julio Centeno
Labor Minister--Wilfredo Navarro
Ambassador to the United States--Francisco Aguirre
Ambassador to the United Nations--Enrique Paguaga
Ambassador to the Organization of American States--Felipe Rodriguez
Nicaragua maintains an embassy in the United States at 1627 New
Hampshire Avenue, NW, Washington, DC 20009 (tel. 202-387-4371).
Nicaragua began free market reforms in 1991 after 12 years of economic
free-fall under the Sandinista regime. Despite some setbacks, it has
made dramatic progress: privatizing 351 state enterprises, reducing
inflation from 13,500% to 12%, and cutting the foreign debt in half. The
economy began expanding in 1994 and grew a strong 4.5% in 1996 (its best
performance since 1977). As a result, GDP reached $1.969 billion.
Despite this growing economy, Nicaragua remains the second-poorest
nation in the hemisphere with a per capita GDP of $438 (below where it
stood before the Sandinista take-over in 1979). Unemployment, while
falling, is 16% and another 36% are underemployed. Nicaragua suffers
from persistent trade and budget deficits and a high debt service
burden, leaving it highly dependent on foreign assistance (22% of GDP in
One of the key engines of economic growth has been production for
export. Exports rose to $671 million in 1996, up 27% from 1995. Although
traditional products such as coffee, meat, and sugar continued to lead
the list of Nicaraguan exports, during 1996 the fastest growth came in
non-traditional exports: maquila goods (apparel), bananas, gold,
seafood, and new agricultural products such as sesame, melons, and
Nicaragua is primarily an agricultural country, but construction,
mining, fisheries, and general commerce have also been expanding
strongly during the last few years. Foreign private capital inflows saw
a net increase in 1996, totaling an estimated $215 million. The private
banking sector continues to expand and now holds 70% of the nation's
Rapid expansion of the tourist industry has made it the nation's third-
largest source of foreign exchange. Some 51,000 Americans visited
Nicaragua in 1996 (primarily business people, tourists, and those
visiting relatives). An estimated 5,300 U.S. citizens reside in the
country. The U.S. Embassy's consular section provides a full range of
consular services, from passport replacement and veteran's assistance to
prison visitation and repatriation assistance.
Nicaragua now appears poised for rapid economic growth. However, long-
term success at attracting investment, creating jobs, and reducing
poverty depend on its ability to comply with an International Monetary
Fund (IMF) program, resolve the thousands of Sandinista-era property
confiscation cases, and open its economy to foreign trade.
The U.S. is the country's largest trading partner by far--the source of
32% of Nicaragua's imports and the destination of 42% of its exports.
About 25 wholly or partly owned subsidiaries of U.S. companies operate
in Nicaragua. The largest of those investments are in the energy,
communications, manufacturing, fisheries, and shrimp farming sectors.
Good opportunities exist for further investments in those same sectors,
as well as in tourism, mining, franchising, and the distribution of
imported consumer, manufacturing, and agricultural goods.
The U.S. embassy's Economic/Commercial Section advances American
economic and business interests by: briefing U.S. firms on opportunities
and stumbling blocks to trade and investment in Nicaragua; encouraging
key Nicaraguan decision makers to work with American firms; helping to
resolve problems that affect U.S. commercial interests; and working to
change local economic and trade ground rules in order to afford U.S.
firms a level playing field on which to compete. The Economic/Commercial
Section counseled 112 U.S. and 148 Nicaraguan firms in 1996 on trade and
investment opportunities. U.S. businesses may access key Embassy
economic reports via the Mission's Internet home page at
The 1990 election victory of President Violeta Chamorro placed Nicaragua
in the ranks of Latin American democracies. Nicaragua pursues an
independent foreign policy. President Chamorro was instrumental in
obtaining considerable international assistance for her government's
efforts to improve living conditions for Nicaraguans (the country is the
second-poorest in the Western Hemisphere after Haiti). Her
administration also negotiated substantial reductions in the country's
foreign debt burden. A participant of the Central American Security
Commission (CASC), Nicaragua also has taken a leading role in pressing
for regional demilitarization and peaceful settlement of disputes within
states in the region.
The Aleman administration has expressed a commitment to follow the major
tenets of its predecessor's foreign policy, to promote Central American
political and economic integration, and to resolve outstanding boundary
disputes peacefully. At the 1994 Summit of the Americas, Nicaragua
joined six Central American neighbors in signing the Alliance for
Sustainable Development, known as the Conjunta Centroamerica-USA or
CONCAUSA, to promote sustainable economic development in the region.
In Costa Rica in May 1997, President Aleman met with President Clinton,
his Central American counterparts, and the president of the Dominican
Republic to celebrate the remarkable democratic transformation in the
region and reaffirm support for strengthening democracy, good governance
and promoting prosperity through economic integration, free trade, and
investment. The leaders also expressed their commitment to the continued
development of just and equitable societies and responsible
environmental policies as an integral element of sustainable
Nicaragua belongs to the UN and several specialized and related
agencies, including the World Bank, the International Monetary Fund
(IMF), World Trade Organization (WTO), UN Educational, Scientific, and
Cultural Organization (UNESCO), World Health Organization (WHO), Food
and Agriculture Organization (FAO), International Labor Organization
(ILO), and the UN Human Rights Commission (UNHRC). Nicaragua is also a
member of the Organization of American States (OAS), the Non-aligned
Movement (NAM), International Atomic Energy Commission (IAEA), the
Inter-American Development Bank (IDB), the Central American Common
Market (CACM), and the Central America Bank for Economic Integration
U.S. policy is to support the consolidation of the democratic process
initiated in Nicaragua with the 1990 election of President Chamorro. The
U.S. has promoted national reconciliation, encouraging Nicaraguans to
resolve their problems through dialogue and compromise. It recognizes as
legitimate all political forces that abide by the democratic process and
eschew violence. U.S. assistance is focused on strengthening democratic
institutions, stimulating sustainable economic growth, and supporting
the health and basic education sectors.
The resolution of U.S. citizen claims arising from Sandinista-era
confiscations and expropriations still figure prominently in our
bilateral policy concerns. Section 527 of the Foreign Relations
Authorization Act (1994) prohibits certain U.S. assistance and support
for a government of a country that has confiscated U.S. citizen
property, unless the government has taken certain remedial steps. In
July 1997, the Secretary of State issued a fourth annual national
interest waiver of the Section 527 prohibition because of Nicaragua's
record in resolving U.S. citizen claims as well as its overall progress
in implementing political and economic reforms.
Other key U.S. policy goals for Nicaragua are:
ð Improving respect for human rights, and resolving outstanding
high-profile human rights cases;
ð Development of a free market economy with respect for property
and intellectual property rights;
ð Ensuring effective civilian control over defense and security
ð Increased effectiveness of Nicaragua's efforts to combat
narcotics trafficking, illegal alien smuggling, international terrorist
and criminal organizations; and
ð Reforming the judicial system.
Since 1990, the U.S. has provided $1.2 billion in assistance to
Nicaragua. Approximately $260 million of that was for debt relief and
another $450 million was for balance-of-payments support. The levels of
assistance have fallen incrementally to reflect the improvements in
Nicaragua, and FY 1997 assistance is estimated at approximately $25
million. This assistance is focused on promoting more citizen political
participation, compromise, and government transparency; stimulating
sustainable growth and income; and fostering better educated, healthier,
and smaller families.
Principal U.S. Officials
Deputy Chief of Mission--Frederick Becker
Economic/Commercial Counselor--Sandra Dembski
Political Counselor--Kevin Whitaker
Public Affairs Counselor--Elizabeth Whitaker
Defense Attache--Col. Richard Driver
Consul General--Robert Blohm
Chief USAID Mission--George Carner
Peace Corps Director--Howard Lyon
The U.S. Embassy in Nicaragua is located at Kilometer 4.5, Carretera
Sur, Managua (tel. country code 505, phone 266-6010). Letters mailed in
the U.S. should be addressed to American Embassy Managua, APO AA 34021.
Other contact information:
U.S. Department of Commerce
International Trade Administration
Trade Information Center
14th and Constitution, NW
Washington, DC 20230
American Chamber of Commerce in Nicaragua
Apartado Postal 202
Tel: (5052) 67-30-99
Fax: (5052) 67-30-98
Caribbean/Latin American Action
1818 N Street, NW, Suite 310
Washington, D.C. 20036
TRAVEL AND BUSINESS INFORMATION
The U.S. Department of State's Consular Information Program provides
Travel Warnings and Consular Information Sheets. Travel Warnings are
issued when the State Department recommends that Americans avoid travel
to a certain country. Consular Information Sheets exist for all
countries and include information on immigration practices, currency
regulations, health conditions, areas of instability, crime and
security, political disturbances, and the addresses of the U.S. posts in
the country. Public Announcements are issued as a means to disseminate
information quickly about terrorist threats and other relatively short-
term conditions overseas which pose significant risks to the security of
American travelers. Free copies of this information are available by
calling the Bureau of Consular Affairs at 202-647-5225 or via the fax-
on-demand system: 202-647-3000. Travel Warnings and Consular Information
Sheets also are available on the Consular Affairs Internet home page:
http://travel.state.gov and the Consular Affairs Bulletin Board (CABB).
To access CABB, dial the modem number: (301-946-4400 (it will
accommodate up to 33,600 bps), set terminal communications program to N-
8-1 (no parity, 8 bits, 1 stop bit); and terminal emulation to VT100.
The login is travel and the password is info (Note: Lower case is
required). The CABB also carries international security information from
the Overseas Security Advisory Council and Department's Bureau of
Diplomatic Security. Consular Affairs Trips for Travelers publication
series, which contain information on obtaining passports and planning a
safe trip abroad, can be purchased from the Superintendent of Documents,
U.S. Government Printing Office, P.O. Box 371954, Pittsburgh, PA 15250-
7954; telephone: 202-512-1800; fax 202-512-2250.
Emergency information concerning Americans traveling abroad may be
obtained from the Office of Overseas Citizens Services at (202) 647-
5225. For after-hours emergencies, Sundays and holidays, call 202-647-
Passport Services information can be obtained by calling the 24-hour, 7-
day a week automated system ($.35 per minute) or live operators 8 a.m.
to 8 p.m. (EST) Monday-Friday ($1.05 per minute). The number is 1-900-
225-5674 (TDD: 1-900-225-7778). Major credit card users (for a flat rate
of $4.95) may call 1-888-362-8668 (TDD: 1-888-498-3648)
Travelers can check the latest health information with the U.S. Centers
for Disease Control and Prevention in Atlanta, Georgia. A hotline at
(404) 332-4559 gives the most recent health advisories, immunization
recommendations or requirements, and advice on food and drinking water
safety for regions and countries. A booklet entitled Health Information
for International Travel (HHS publication number CDC-95-8280) is
available from the U.S. Government Printing Office, Washington, DC
20402, tel. (202) 512-1800.
Information on travel conditions, visa requirements, currency and
customs regulations, legal holidays, and other items of interest to
travelers also may be obtained before your departure from a country's
embassy and/or consulates in the U.S. (for this country, see "Principal
Government Officials" listing in this publication).
U.S. citizens who are long-term visitors or traveling in dangerous areas
are encouraged to register at the U.S. embassy upon arrival in a country
(see "Principal U.S. Embassy Officials" listing in this publication).
This may help family members contact you in case of an emergency.
Further Electronic Information:
Department of State Foreign Affairs Network. Available on the Internet,
DOSFAN provides timely, global access to official U.S. foreign policy
information. Updated daily, DOSFAN includes Background Notes; Dispatch,
the official magazine of U.S. foreign policy; daily press briefings;
Country Commercial Guides; directories of key officers of foreign
service posts; etc. DOSFAN's World Wide Web site is at
U.S. Foreign Affairs on CD-ROM (USFAC). Published on an annual basis by
the U.S. Department of State, USFAC archives information on the
Department of State Foreign Affairs Network, and includes an array of
official foreign policy information from 1990 to the present. Contact
the Superintendent of Documents, U.S. Government Printing Office, P.O.
Box 371954, Pittsburgh, PA 15250-7954. To order, call (202) 512-1800 or
fax (202) 512-2250.
National Trade Data Bank (NTDB). Operated by the U.S. Department of
Commerce, the NTDB contains a wealth of trade-related information. It is
available on the Internet (www.stat-usa.gov) and on CD-ROM. Call the
NTDB Help-Line at (202) 482-1986 for more information.
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