New Internationalist

The Facts

Issue 156

new internationalist
issue 156 | February 1986

[image, unknown]

Nicaragua at work
Nicaragua has its back against the wall. It is under
military attack, so it has to finance a war. But it is also
trying to rebuild its economy so that everyone can have
a share in the fruits of production. Here we show how
Nicaraguans are working to pay their way.

[image, unknown]

VITAL STATISTICS

1978

1980

1982

1984

Population

2.6m

2.7m

3.0m

3.2m

GDP per capita (1970 $s)

2,813

2,162

2,109

2,034

Unemployment

15

22

22

20

Increase in prides Dec - Dec

4

24

22

50

Decreases in real wages

6

15

12

9

External debt ($m)

961

1,588

2,730

3,918

* There is a severe labour shortage in Nicaragua so these figures actually indicate those not in formal employment

Source: Economic Commission for Latin America


PEOPLE

Nicaragua with only three million people is the most sparsely populated country of Central America. Three-quarters of the population are Spanish-speaking mestizos, the product of intermarriage between the original Amerindians and the Spanish conquistadors. Most of these live on the Pacific coast and 42 per cent live in cities - a very high proportion for a country with little industrial employment

Those on the Atlantic Coast virtually form separate nations. The major Atlantic city, Bluefields (with one of the highest rainfalls in the world) is not even linked by road to the rest of the country. Difficulty in travelling between east and west meant that the Spanish never really conquered the Atlantic coast, so the British were able to establish a foothold. The major English-speaking group is the 30,000 creoles (a mixture of African, Amerindian and European descent).

But the largest separate group are the Miskito Indians - 80,000 of them if you count those currently living in Honduras. They have their own separate language and culture.


TRADE

The trade boycott by the United States does not seem to be having a very severe impact on the economy. Alternative trading links have now been established, particularly with Europe.

In 1984, the last full year for which figures are available the export destinations are as shown below. The chart to the right indicates the most important exports by value.

These were sent to:

Country

(%)

Central America

9

Other L. America

2

EEC

31

USA

10

Japan

27

Canada

3

Eastern Europe

6

Others

12

[image, unknown]

THE MEDIA

The two TV channels are state-run as are many of the radio stations. But the country's radio airways are penetrated by no fewer than 75 foreign AM and FM stations, mostly from Honduras and Costa Rica - in addition to all the short-wave ones.

There are three national daily papers. Barricade (circulation 100,00) is run by the FSLN. La Prensa (63,000) is a virulently right-wing opposition paper. El Nuevo Diana (55,000) was started as a breakaway from La Prensa and takes a position of 'critical support' for the government. All are subject to prior censorship.

[image, unknown]


MONEY

Nicaragua is very dependent on international trade. Almost all manufactures gods have to be imported so US dollars are at a premium. The official exchange rate for the dollar depends on what is bought. People are allocated dollars at rates which start at 20 'cordobas' to the dollar for essential goods and rise to 50 or more depending on the import priorities.

For non-essential goods a free market rate applies. In October 1985 this was 700 to the dollar, reflecting high demand by the middle classes for imported luxuries and travel. The confusing range of possibilities allows the government to placate the middle classes by allocating them cheap dollars whenever politically expedient - some can buy cars at the 50 rate.


THE MILITARY

At least 50 per cent of government expenditure is now devoted to defence and the army is now 50,000 strong, two thirds of whom are conscripts. Young men between 18 and 24 are required to give two years of 'Patriotic Military Service'

There are also popular 'militias', part-time volunteer forces within communities, especially those vulnerable to contra attacks - these include women and also children of 13 years and upwards.

The Government says that 200,000 people are already armed or will be in the near future. In Managua men between 25 and 40 are now also liable to be called up into the Military Reserve, which involves a month's training each year away from home.


PRIVATE AND PUBLIC

The revolution nationalized all the Somoza family property. But the State's role in production is still modest by socialist standards. It had grown from 11 per cent of GNP in 1979 to 39 per cent in 1982 - about the same time as that for Canada or the UK.

[image, unknown]


POLITICS

The Constitution was suspended in 1979 following the Revolution. Power passed to the leadership of Sandinista National Liberation Front (FSLN) and its National Directorate - the nine 'Commandantes of the Revolution'.

Elections, generally accepted to have been free and fair, were held in November 1984 and won by the FSLN. Daniel Ortega, (right), a Commandante, was elected President and Sergio Ramirez, a distinguished writer and an FSLN member, was elected Vice-President But policy continues to be made by the National Directorate - in which there are assumed to be divisions between more liberal elements, which would include Ortega, and those further to the left like Tomas Borge, one of the founders of the FSLN.

A 96-person National Assembly (in which the FSLN also has a majority) was also elected. This has been enacting legislation but one of its major tasks has been the drafting of a new Constitution which is due early in 1986.

Some 75 per cent of the electorate voted. The percentage of valid votes was cast as follows:

FSLN

67.0%

Democratic Conservative

14.0%

Independent Liberal

9.6%

Popular Social Christian

5.6%

Communist

1.2%

Socialist

1.3%

Popular Action - Marist-Leninist

1.0%

Source: Envio


[image, unknown] PRODUCTION

Nicaragua is predominantly agricultural - an exporter of raw materials, chiefly cotton and coffee and an importer of most manufactured goods. Before the revolution of 1979, around 20 per cent of the arable land was owned by President Somoza and his family and the economy was directed towards agro-exports and the import of luxury goods. There was little industrial development. In 1977 the richest five per cent of people shared 28 per cent of the national income while the poorest 50 per cent made do with 15 per cent. (There are no comparable statistics available for today.)

The economy is now under pressure from three directions. First, from a sharp decline in the world prices for Nicaragua's exports like cotton and coffee: the same harvest would buy 30% less in 1984 than in 1978. Second from low output Levels of production have never really recovered from the upheaval of the revolution and the subsequent running down of equipment by political opponents. Third from the cost of the contra war. The Government estimates that they suffered losses in production of around $300 million between 1981 and 1984.


Previous page.
Choose another issue of NI.
Go to the contents page.
Go to the NI home page.
Next page.


This first appeared in our award-winning magazine - to read more, subscribe from just £7

Comments on The Facts

Leave your comment