by Nick Cooke 

Unpack your bags:

It looks like efforts by the Nicaraguan Tourism Institute (INTUR) and this humble publication are paying off. INTUR recently reported a rise in the number of visitors. There were 19% more people coming to Nicaragua during the first half of 2004 compared to the same period in 2003. Spending by travelers over the same period rose by 8.7%. Of the 350,339 people entering the country the first half of this year, 289,000 spent at least one night, while 61,260 only spent a few hours in transit. Average per-person spending was $75, for a total of $79.6 million, $6.4 million more than the first semester of last year. Tourism is climbing rapidly up the list of foreign exchange earners for the country and investment projects are springing up all over the place. Maybe it’s time to dust off the plans for that bed & and breakfast operation you’ve dreamed of? INTUR and local governments are even involved in an anti-litter campaign to improve the local image.  

Top 10 with a…?

Nicaragua’s former president Alemán made the top 10 on the UN Human Rights Sub-Commission list of Earth’s most corrupt political figures. Arnoldo is, for the time being, quartered in the Military Hospital, recovering from a finger operation. This serious medical procedure was performed on a digit the Liberal head honcho, infamous for his leadership style, often used to appoint people loyal to him to important positions in what local commentators label “dedocracy,” and not democracy, a play on words in Spanish. (For those of you without a dictionary at hand, “dedo” means finger). He’s not flipping the bird.

Son of a…

Front-pages of national papers featured yet another Shakespearean drama, this time Hamletian in nature. In his monograph to the Central American University Journalism Faculty, Daniel Ortega’s son Juan Carlos wrote about how his uncle, Humberto Ortega is working to take over the FSLN. He postulated that the former general and military strategist (and recently-published author) is working with others with “capitalist” interests who gained fortune in the aftermath of the 1990 elections in what is known popularly as the “piñata.” Observers commented that Juan Carlos’ mother, Rosario Murillo, is behind it all, as if she could play the part of Ophelia. For his part, Daniel said there is no return to “already-failed alternatives.”

A whale of a deal:

Japan wiped $118.4 million of debt off Nicaragua’s slate in late July, five days after Nicaragua voted in favour of lifting a ban on whaling at the International Whaling Commission meeting. Is it coincidence, or will cetaceans soon make a contribution to poverty reduction efforts here? Minister of Industry and Development Mario Arana stated emphatically that the country’s vote is not for sale. Nevertheless, Taipei has made this country a major development aid partner since Nicaragua voted to recognize Taiwan instead of mainland China as the “real” China.

You can bank on it!

Investors invariably look into what happens with banks. The BECA (or Banco Europeo de Centroamérica) went belly-up after dealing in questionable papers, including bonds from the pre-Hitler Weimar Republic. That was in the late 1990s, the first of multiple bank failures that plagued the country and drained its reserves.

When a bank gets to the point of not being able to meet its commitments to depositors, the Superintendence of Banks intervenes. Following procedure back then, the failed bank’s assets were awarded to the financial institution making the best offer in exchange for assuming the loans portfolio of BECA.

In July, Supreme Court Magistrate Rafael Solis announced that BECA director Alfonso Robelo should be compensated due to irregularities in that procedure. In the late 1980s, Robelo was part of what was called the Contra Civilian Directorate. Solis, on the other hand, was a leading FSLN figure in the National Assembly at that time of civil strife and polarization. They now appear to revolve around common poles of monetary interest.

Solis also mentioned that the failure of Banco Sur, victim of a Guatemala-origin financial scam shortly after the collapse of the BECA, should be considered for compensation, too. Coincidently, both banks were absorbed by BanCentro, with which the Magistrate has got his hair in a knot arising from a multi-million dollar lawsuit filed by his godson, Haroldo Montealegre against the president of BanCentro.

Pay and pay again

Preemptively and as if itching for a fight between Branches of Government, the Magistrate said if the sentences for compensation hold firm, the Bolaños Presidency must pay or be held in contempt. He lambasted the administration, saying the President wants to privatize the judicial system in favor of bankers and big business and that Bolaños is involved in a campaign to discredit the Judicial Branch.

In that regard, the Judiciary is in dire need of a spin doctor to deal with bad imaging. Accusations abound of sentence-trafficking from local tribunals up to the Supreme Court for cases involving theft, murder, child abuse… all the way up to the control of multinational dairy corporations and money-laundering in the rarified atmospheres of power. All depend on vested political or financial interests.

Bank-breaking swindles have already cost the country around a half billion dollars to honor deposits and maintain public confidence in the financial system through bond issues that now near maturity. It appears as if Nicaragua may pay yet again, this time to shareholders of failed banks. Is it just us, or is this justice?

Municipal elections:

Good times for paint distributors. If these municipal elections are anything like past ones, you will have seen paint applied liberally, sandinistally, and conservatively all over the place. Walls, curbs, roadways, streetlight posts, trees… all bear witness to the graffiti custom in Nicaragua, which has led to many imaginative (and not so) scribblings. Afterwards, more paint can be sold to wall owners to cover them over.

An ounce of prevention:

With vision, hindsight is 20/20. With gravity and geomorphology, landslides are inevitable. A recent one off Cerro Musún in north-central Nicaragua affected a number of families. Civic groups have alerted authorities about and imminent landslip danger in Dipilto, along the Pan-Am Highway, which could affect 50 families. Deforestation is blamed again, as if chopping down trees willy-nilly is like the weather, which you can not control.

Who’s at Asphalt?

Construction of a superhighway from Managua to Granada is illustrative of how things can go wrong. A Spanish firm won the contract to do the work with a bid well below their competitors. They managed to make the route about as enjoyable as a barrel roll down a rocky slope.

Deviating from standard highway-construction procedures, the Spanish firm Hispanica opted for widening and leveling rights-of-way along much of the route, rather than attacking the job in sections, paving bit-by-bit along the way. They then proceeded to rip up remnants of the pre-existing macadam, already semi-destroyed with the cutting of trenches across it for drainage culverts.

Months later, not a single lineal meter had been paved. The asphalt plant they need for the work had yet to be installed by late August. Drivers now run along the unpaved new roadbed. This is anathema to having a good sub-base for the carriageway and results in billowing clouds of dust. Roadside residents staged a protest wanting the road paved or the firm tarred and feathered.

Questions were raised about the whole fiasco in governing circles months ago. Why was Minister Pedro Solorzano not pushing the firm harder to do the work, a centerpiece of infrastructure for development? The money is there. How come subcontractors complain about nonpayment by Hispanica for work done? Doubts have even been raised about the material being used as underlay for the eventual highway.

That firm won the bidding war for this major contract by coming in much lower than other companies with experience in the country, apparently calculating in estimates for local labour below what is really charged.

The government made an attempt to have the construction firm live up to its commitments, including meetings with Spanish Government representatives. A new deal was signed in July to honor the original one, and Hispanica now the promises to complete the job by November 2005.

Good luck!

Meanwhile, and perhaps until then, because of the near-complete destruction of the original 2-lane blacktop, some residents along that route now give their address as from “where the Masaya Highway used to be.” Does Hispanica have an interest in importing shock absorbers and leaf springs?

Stockholm Syndrome Sandinista Style

Falling in love with your kidnappers – that is the essence of what is called the Stockholm Syndrome. Assuming the positions of your enemies and acting as they say, not as they do, is a variation on this theme.

July 19th, 2004 marked 25 years since the overthrow, led by the Sandinista insurgents, of the Somoza dictatorial dynasty. A rally was held to commemorate the event and thousands thronged to the shoreside Lake Managua plaza for a full day of banner-waving and slogan-shouting.

FSLN Secretary-General and former president Daniel Ortega began his speech in twilight and went full on for over an hour. He talked of how it was before. He talked about how it was after that. He talked of those not here now and called for respect for “heroes and martyrs of the Revolution.” He also talked vaguely of the future.

 Re-run

In part a repeat of last year’s speech, Ortega proposed what he called a “parliamentary system” consisting of a body of representatives from all sectors of society to decide on political matters. Very reminiscent of the Council of State, dissolved in 1984 in order to hold the free elections of that year, demanded by neighbors and the powers that ruled the region. Danny O was elected President and the National Assembly came to be.

Shortly thereafter, as part of the image management recommended to the administration, Ortega was photographed jogging in New York’s Central Park during a visit to address the General Assembly of the United Nations. Ortega, then a world leader, even appeared on the Phil Donahue Show.

US-born and bred advisors sympathetic to revolutionary power advanced recommendations about how to behave, what to say, and when to say it. Daniel and other leaders of the Sandinista Party were held in thrall by such advice, a way to counteract the Reagan-Bush Administration campaign to discount the attempted alternative represented by the Sandinista Revolution.

Is apple pie next?

Nicaragua’s new leaders became infatuated with that style and adopted it, as earlier-intervened leaders of this country had done before, with the resultant baseball fanaticism, as in any territory occupied earlier in the 20th century by US armed forces (Cuba, Japan, Panama, Dominican Republic, Puerto Rico). Then came electioneering, the idea of winning votes with vague unkeepable promises.

The most prominent jingle in the 1989 campaign up to the 1990 vote was “It’ll all be better” (Todo será mejor). This, when the civil war was reaching new heights of death and destruction and the Bush-Quayle Administration was acting intransigently in its exercise of authority over what they called their “backyard.”

Extreme civil strife in El Salvador and Operation Screaming Eagle in Panama occurred during that election campaign. The FSLN, following the rules of the game they established in emulation of their northern neighbour, lost those national elections, and every other one since then. So much for trying to join ‘em if you can’t lick ‘em.

Meanwhile, back at the plaza

As the crowd dwindled into the Managua night, Ortega declared that the system is rotten and it’s time for a change, as if he had a copy of the John F. Kerry nomination-acceptance speech. No specifics were spoken, perhaps in recognition of complicity.

In a gesture of reconciliation towards the Catholic hierarchy, a trenchant opponent of the Sandinistas since the get-go, Ortega put forward that recognition should be given to Catholic Cardinal Miguel Obando y Bravo for the role he plays in the country. A stony silence, interrupted only by the cries of vendors selling refreshments, followed that proposal.

Ortega had recently attended a gathering of Latin American leftist forces in Brazil. It appears he has decided to put a more radical turn-of-phrase into his discourse, probably in order to try to win back the dispossessed rank and file of the FSLN party, who see their plight unchanged or worsening. Kidnapped into the system and loving it, some leaders claiming representation of the downtrodden masses drive about in Mercedes Benz SUVs and sedans.

          How Swede it is!

Decrying Over Spilt Milk

Parmalat processes roughly 80% of Nicaragua’s dairy goods, and with a range of other products, the brand is prominent on shop shelves and in refrigerators. Dairy farmer cooperatives have invested in new infrastructure to boost production, counting on Parmalat to purchase their produce.

Though reportedly not affected by the multi-billion dollar scam in Italy last spring, the Parmalat subsidiary here is involved in a local kafuffle. Earlier this year, it was in arrears to Tower Bank (Panama) and Banco de América Central (Nicaragua). Nobody has explained how a company with a commanding market share couldn’t muster that scratch. Assets were about to auctioned off to repay the debt, and Nicaragua’s major dairy operation faced tailspin entry.

Then the financial group LAFISE bought the debt and Parmalat continued supplying the local market. A deal involving shareholdings was worked out. Dairy farmers and cooperatives sighed relief. They still could sell milk to pay off bank loans taken out to upgrade production.

Meanwhile, a years-long multi-million dollar lawsuit launched by Haroldo Montealegre against LAFISE Group president Roberto Zamora was enjoying hot favors in local courtrooms. Judge Ligia of the Managua 5th District Court ordered that Montealegre now “owned” the $5.8 million dollar bailout LAFISE loan as partial settlement in that case and she gave Haroldo full powers to intervene in the multinational corporation’s subsidiary.

 Montealegre set to work and talked of restructuring Parmalat’s Board of Directors, even though the $5.8M debt arrangement didn’t represent a majority of that company’s holdings. Word was that this might cause a diplomatic riff with Italy over security and guarantees for investors.

Parmalat’s original directors from Italy decided to appeal the intervention order, seeking recourse in their rights under the legal system. The appeal application was denied because Montealegre had used his full power in the company to revoke the powers-of-attorney held by the firm’s lawyers. Now, only solicitors selected by Haroldo can represent Parmalat-Nicaragua. That’s having your milk and drinking it, too.

The local business association COSEP voiced concern. Lawsuits are filed constantly in the shark pool of capital interests and with Nicaragua’s Judiciary – some say the finest system that money can buy – so byzantine, other firms could be “intervened,” depending on judicial whims and the interests they allegedly serve.

Parmalat’s fate naturally causes concern on the range where the milk cows roam. Publicly, talk is of how Montealegre has no experience in the dairy business. Between the lines, you could read the worries about his track record.

Haroldo does have ample experience in firms he has controlled. There was a short-lived daily newspaper, La Tribuna, in the late 1990s. There was Banco Mercantil, bankrupted in the early 2000’s. Customary practices involved high-priced contracts with firms the former banker had interests in. There were also the personal credits and a credit card for his wife, as recorded in Board meeting minutes. Haroldo has ample experience in milking business interests.

Given the amounts and the parties involved, this particular “legal” dispute will continue for some time to come, neither side cowing before the other.

Ready to rumble?

Beer battles are on in Nicaragua. Río Brewery of Guatemala recently introduced Brahva with a higher alcohol count (5.0%) and a lower price. Central American Breweries – makers of Victoria, Toña, and Premium – responded with Búfalo at an equally low price and a titch more alcohol content (5.1%). Their regular brands average around 4% alcohol content by volume. A media blitz of TV ads, posters, billboards and calendars stretch the limits for sexually-oriented sales pitches.  Bottles literally ejaculate foam all over comely bikini-clad lasses. On-site promotional events, with beer tents springing up like mushrooms, grace every public festival.  Watch for Río to truck in other labels from their house.