The national dish of Nicaragua, gallo pinto, depends on them. They are a basic staple in the diet of most every Nicaraguan. And the price for them has been going up and up and up, beyond the reach of the majority of households.

The spike in bean prices this past fall is emblematic of a market system that does not pay attention to people’s needs. Beans are sown throughout the country, usually in two plantings, sometimes three, a year. Trading houses buy up the first harvest and sell it on the export market. Climatic factors then come into play and a large part of the second crop fails, as it did this year because of heavy rains.

So some of the beans are then re-imported, at a higher price naturally. This time, the final sale price to a consumer buying a pound from a family store shot up to over 20 córdobas a pound (about $1.10). In some cases, the re-importation involves beans that never even actually left the country. They were stored in bonded warehouses waiting for a price increase. This does not, however, become a political issue with one side accusing the other of playing with the hunger of the poor, since the businesspersons involved are from all political persuasions.

It’s winter in northern latitudes, but the period from December to February is without a doubt the best time of the year to visit Nicaragua climate-wise, and so the people here call it the start of “summer.” The rainy season (or “winter” is over), the skies are clear and blue with puffy white clouds drifting in the fresh breeze, everything is still green, and temperatures are more moderate. It’s almost like the land is calling you to come outside and play or indulge in some outdoor activity, even if it is only to sit out on a porch with some friends and a refreshing beverage or two. Taking a rental to different parks and sites all over the country is also better at this time of year, although you may experience some brief delays along some stretches where Transport Ministry crews are fixing stretches that were battered during the last rains.

Antenor Rosales, the President of the Central Bank, announced during the third quarter of this year that projections for the annual growth rate of the economy have been revised downward, from 4.2% to 3.9%. He attributed this to a decline in domestic consumption and construction, combined with the energy crisis that has meant daily four-to-eight-hour power cuts all over the country. Rosales also said that the inflation rate would be 10% and not the 7.5% that was projected earlier this year.

This was all announced before the recent round of petroleum price increases. At the same time, the government’s economic authorities are working out the budget for next year. The first draft looks good on paper but apparently has a fatal flaw. Illustrating the fact that economists are not fortune tellers, the budget proposal is based on a projected price of oil of $76 a barrel.

This, together with the need to channel funds to rebuild parts of the country damaged in recent storms, will require some artful juggling of budget lines. The billion dollar question: Where will the money come from to pay for the promises made during the last elections? Many of the poor put their faith in the FSLN’s promises of zero hunger, zero unemployment, decent housing and free health care and education. It is highly doubtful that calls for austerity and belt-tightening and more waiting will be received well.

It makes you wonder sometimes. Germany is ready to donate around $18 million. The national government and the city government would kick in a few million more. The contract was signed in October 2006. The plan is to fix up the drinking water and sanitary drainage system in the City of Granada.

But a year has passed and work on the ground has yet to begin. At issue is how the renovated system will be run. The State agency ENACAL wants to assume full control of its management. Privatization of water is something that is anathema to many here, and the director of ENACAL appears to feel that that is what is at stake.

The German donors are not proposing privatization: they recommend that the project be managed by a separate agency that is part of ENACAL, a kind of local water authority. Rates for service would be established by INAA, the government’s regulatory authority. But first of all, the taps have to be installed.

Cacao was the base for the drug of choice in the 16th century royal courts of Europe after some intrepid scurvy-ridden plunderers returned from the New World with the recipe for a stimulating beverage. Before that, it was currency in Mexico and down through Central America, putting the lie to the old saying that money doesn’t grow on trees. Cacao ruled.

Nicaragua used to be a major producer of the bean that goes into every chocolate bar, with harvests from plantations along the Rivas isthmus and elsewhere in the country. Little by little, this agricultural tradition is being rescued and some Nicaraguan farmers are reaping the benefits from different projects financed from abroad to produce the raw material.
With the increasing strength of the euro, the German company Ritter Sport recently announced it will pay a better price for organic Nicaraguan cacao, raising it from $3,000 for a metric ton to $3,650. Ritter Sport has been buying between 100 and 150 metric tons over the last few years.

Nicaragua’s capacity for this crop is increasing. There are now about 5,000 hectares being cultivated by 6,500 small farmers. The Ministry of Agriculture projects that there will be 10,000 hectares by 2008 and wants to have the area under cultivation increase to 100,000 hectares over the following five years.

Still no word though about any plans to actually process this fruit and make chocolates here. What would a locally made chocolate bar be called? An “esnickersagüense”?

In the wake of Hurricane Felix and the torrential rains that wreaked havoc on wide areas of Nicaragua, the country’s political class decided to focus on their version of the priorities: reforms to the Constitution in order to establish a new system that would, they say, be a form of parliamentarianism. The figure of Prime Minister would be created but the President would still retain a lot of power.
This is viewed by many as an open attempt to ensure the perpetuation in power of the two main political forces: the Sandinistas of Daniel Ortega and the PLC (Constitutional Liberals) of former president and convicted felon Arnoldo Alemán.

Central to the reforms is the overturn of the ban on a president seeking office for two terms in a row. The idea of no reelection exists because of concerns around the possibility of establishing an “elected dictatorship.” Another reform proposes that whoever gets the most votes in a presidential election is the winner. At present, a candidate needs at least 35% of the vote with a five percent lead over the runner up.

This suggested reform would virtually ensure a continuation of the rule of Daniel Ortega after the next elections in 2012 since he consistently gets more votes than any other non-Sandinista candidate.

That wind blowing up dust in your eyes and trash around your feet is soon going to be generating electricity. The “green breeze” could happen as soon as the end of this year. A European wind power consortium recently made a deal with the Ministry of Energy and Mines to invest $72 million for a wind farm in Rivas, near the shores of Lake Nicaragua.

You won’t be able to miss it as you drive along the Pan-Am Highway. Nineteen 80-meter tall towers with three 44-meter blades will scoop power from the breezes off the lake: up to 2.1 megawatts each. The electricity produced, to be sold to the national grid, is equivalent over a year to what would come from burning 217,000 barrels of bunker C.

Parallel 15 as it is known (referring to 15th line of latitude north) comes straight out of Cabo Gracias a Dios, the site where Columbus washed ashore on his fourth failed voyage in search of a passage to India. Parallel 15 is more or less where the northeast corner of Nicaragua enters the Caribbean Sea. But since the border with Honduras runs at an upward angle,

Nicaragua felt that its territorial waters should extend angularly out onto the continental shelf. Honduras, naturally, felt differently: that the obvious demarcation should run straight east.

This international dispute began after Nicaragua under Somoza agreed in the International Court at the Hague to cede a large chunk of its northeastern territory to Honduras, what is known as the Mosquitía, back in the late 1950s. Offshore rights were somehow left out of that settlement. Then Colombia came onto the scene, making a deal with Honduras to recognize its claim in exchange for more rights to the continental shelf.

Colombia had already taken over a large chunk of offshore Nicaragua back in the early 20th Century in exchange for allowing the separation of Panama in order to form a new republic that would let a canal be built through it. That arrangement, brokered by the United States, resulted in international litigation around the possession of the Caribbean islands of San Andrés, Providence, Quitasueño, and Roncador that has yet to be resolved, at least according to the Nicaraguans.

For quite some time, nationalist sentiments and resentments were building up. A turf war between Honduras and Nicaragua, two diminutive countries that are the poorest on the continental mainland of the Americas, was unlikely. But history has shown that such a thing is never completely out of the question, which is why the military in both countries have been keeping themselves in a state of readiness. This has resulted in ongoing discussions about a “balance of forces” in the region. Nicaragua has been hanging onto what it can of its stock of Soviet-era surface-to-air missiles while Honduras has fighter bomber jets. Colombia has even more military arms.

Besides national pride, at stake was the wealth of seafood resources. The grouping of islands known as the Mosquito Keys is a breeding ground for lobsters, shrimp, and other marine species of commercial value.

And then there are persistent reports of petroleum resources in the vicinity. Some exploratory wells were drilled offshore in the 1970s. An aerial survey by Soviet planes in the 1980s indicated the existence of a significant amount of oil, with speculative estimates of up to billion of barrels. At today’s prices… well, you can do the math.

Meanwhile on the Pacific side, there is constant arguing over the territorial rights of Honduras, Nicaragua, and El Salvador in the Gulf of Fonseca. Once again, fishery resources are the bone of contention. Over the years, different buoys were installed to mark where the rights of one country end and the other’s begin. These, of course, were often ignored and from time to time, reports of one navy or another capturing fishing boats from the other country appeared in the press.

Now, apparently, the neighbors are getting together to work out a relationship mutually beneficial to all three. These two settlements are happening on President Daniel Ortega’s watch. Who knows? At this rate, perhaps he may be able to bring a final resolution to the dispute with Costa Rica over the San Juan River that marks much of the border between the two countries.

Nicaragua suffered severe damages and loss of life from meteorological phenomena in September and October. Hurricane Felix, a category five storm, hit the northeast of the country on September 4. Between 100 and 200 people died, many of them fishermen out at sea in small craft, and an estimated 200,000 people saw their homes and livelihoods trashed by the strong winds and rain. Livestock drowned, tens of thousands of hectares of crops were washed out, 20,000 homes were destroyed, and fishing gear was lost. The government set the figure for damages at $850 million.
Then came 55 days of steady rain. The areas affected most are in Nicaragua’s northwest. Loss of life was low, but damages to farms and roadways were heavy.
Reconstruction efforts have begun and the authorities of the North Atlantic Autonomous Region (RAAN) and the Sandinista government have designed a plan for the areas affected by Felix that calls for the investment of almost $300 million over six months. Another $100 million is needed for zones in the northwest of the country.
Emergency international relief has been arriving, with the largest donors being the World Food Program, the USA, and Venezuela. It will take a lot of work to repair the damaged homes and, meanwhile, food has to be provided to tide the people over until crops can be replanted and harvested.
The government has had to make adjustments to the national budget in order to redirect scarce funds to cover the costs of, for example, road repair. A moratorium on paying back part of the country’s debt has been proposed in order to free up hundreds of millions of córdobas.