Nicaragua

NICARAGUA

LOCATION, SIZE, AND EXTENT
TOPOGRAPHY
CLIMATE
FLORA AND FAUNA
ENVIRONMENT
POPULATION
MIGRATION
ETHNIC GROUPS
LANGUAGES
RELIGIONS
TRANSPORTATION
HISTORY
GOVERNMENT
POLITICAL PARTIES
LOCAL GOVERNMENT
JUDICIAL SYSTEM
ARMED FORCES
INTERNATIONAL COOPERATION
ECONOMY
INCOME
LABOR
AGRICULTURE
ANIMAL HUSBANDRY
FISHING
FORESTRY
MINING
ENERGY AND POWER
INDUSTRY
SCIENCE AND TECHNOLOGY
DOMESTIC TRADE
FOREIGN TRADE
BALANCE OF PAYMENTS
BANKING AND SECURITIES
INSURANCE
PUBLIC FINANCE
TAXATION
CUSTOMS AND DUTIES
FOREIGN INVESTMENT
ECONOMIC DEVELOPMENT
SOCIAL DEVELOPMENT
HEALTH
HOUSING
EDUCATION
LIBRARIES AND MUSEUMS
MEDIA
ORGANIZATIONS
TOURISM, TRAVEL, AND RECREATION
FAMOUS NICARAGUANS
DEPENDENCIES
BIBLIOGRAPHY

Republic of Nicaragua
República de Nicaragua

CAPITAL: Managua

FLAG: The national flag consists of a white horizontal stripe between two stripes of cobalt blue, with the national coat of arms centered in the white band.

ANTHEM: Salve a ti, Nicaragua (Hail to You, Nicaragua).

MONETARY UNIT: The gold córdoba (c$) is a paper currency of 100 centavos. There are coins of 5, 10, 25, and 50 centavos and 1 and 5 córdobas, and notes of 1, 2, 5, 10, 20, 50, 100, 500, 1,000, 5,000, 10,000, 20,000, 50,000, 100,000, 200,000, 500,000, 1,000,000, 5,000,000, and 10,000,000 córdobas. c$1 = us$0.59701 (or us$1 = c$1.675) as of 2005.

WEIGHTS AND MEASURES: The metric system is the legal standard, but some local units also are used.

HOLIDAYS: New Year's Day, 1 January; Labor Day, 1 May; Liberation Day (Revolution of 1979), 19 July; Battle of San Jacinto, 14 September; Independence Day, 15 September; All Saints' Day, 1 November; Christmas, 25 December. Movable religious holidays include Holy Thursday and Good Friday.

TIME: 6 am = noon GMT.

LOCATION, SIZE, AND EXTENT

Nicaragua, the largest of the Central American countries, has an area of 129,494 sq km (49,998 sq mi), which includes the area covered by the waters of Lake Nicaragua (about 8,000 sq km/3,089 sq mi) and Lake Managua (about 1,025 sq km/396 sq mi). Comparatively, the area occupied by Nicaragua is slightly smaller than the state of New York. The country has a length of 472 km (293 mi) n–s and a width of 478 km (297 mi) w–e. Bounded on the n by Honduras, on the e by the Caribbean Sea, on the s by Costa Rica, and on the w by the Pacific Ocean, Nicaragua has a total boundary length of 2,141 km (1,330 mi), of which 910 km (565 mi) is coastline.

In 1980, Nicaragua unilaterally abrogated its 1928 treaty with Colombia, confirming that nation's sovereignty over the Caribbean archipelago of San Andrés and Providencia, about 190 km (120 mi) off the Nicaraguan coast. Nicaragua also disputes the Treaty of Quita Sueño, ratified by the US Senate in July 1981, according to which Colombia received the uninhabited islands of Quita Sueño Bank, Roncador Cay, and Serrana Bank.

Nicaragua's capital city, Managua, is located in the southwestern part of the country.

TOPOGRAPHY

The Caribbean coast, known as the Mosquito (or Miskito) Coast or Mosquitia, consists of low, flat, wet, tropical forest, extending into pine savannas 80–160 km (50–100 mi) inland. The coastal lowland rises to a plateau covering about one-third of the total area. This plateau is broken by mountain ranges extending east-ward from the main cordillera to within 64–80 km (40–50 mi) of the Caribbean coast. The mountainous central area forms a triangular wedge pointed southeast, rising at its highest to some 2,000 m (6,600 ft).

The plains and lake region, in a long, narrow structural depression running northwest to southeast along the isthmus, contains a belt of volcanoes rising to 1,500 m (5,000 ft) and extending from the Gulf of Fonseca to Lake Nicaragua. In this region is located Lake Managua, at 41 m (136 ft) above sea level, which drains through the Tipitapa Channel into Lake Nicaragua, at 32 m (106 ft) above sea level, which, in turn, drains through the San Juan River eastward into the Caribbean. Lake Nicaragua is about 160 km (100 mi) long and 65 km (40 mi) wide at the widest point, while Lake Managua is 52 km (33 mi) long by 25 km (16 mi) wide.

The principal waterways are the Coco (or Segovia) River, navigable up to 240 km (150 mi) inland from the eastern Mosquito Coast, and the San Juan, navigable to within a few miles of the Caribbean, where a series of rapids halts transportation.

Nicaragua lies in an earthquake zone where hundreds of minor tremors, shocks, and earthquakes occur each year. More severe earthquakes have occurred periodically. Some of these are centered off the coast of Nicaragua, such as the 6.9 magnitude earth-quake on 9 October 2003 and the 6.6 magnitude quake of 2 July 2005.

CLIMATE

Except in the central highlands, the climate is warm and humid. Average humidity in Managua in June, the most humid month, is 84%; in April, the driest month, 62%. The mean temperature, varying according to altitude, is between 20° and 30°c (68° and 86°f). In Managua, monthly average temperatures range from a minimum of 23°c (73°f) and a maximum of 30°c (86°f) in January to a minimum of 26°c (79°f) and a maximum of 31°c (88°f) in July. There are two seasons: a wet season, from May to December, and a dry season, from January through April. Rainfall, however, varies according to region, and the rainy season in the eastern area may extend 9 or even 12 months. Average annual rainfall along the Mosquito Coast reaches 254–635 cm (100–250 in) as a result of the easterly trade winds blowing in from the Caribbean; the highlands also have heavy rainfall. Managua receives 114 cm (45 in), while the Pacific coast averages over 102 cm (40 in) a year.

FLORA AND FAUNA

The central highlands region has extensive forests of oak and pine on the slopes, but lower valley elevations show damage from fire and agricultural activities. The largest pine savanna in the rainy tropics stands on the lowlands behind the Mosquito Coast. The wet and humid Caribbean coastal plain has an abundance of tropical forest, with wild rubber, cedar, ebony, mahogany, and rose-wood attracting some exploitation.

Wildlife includes the puma, deer, monkey, armadillo, alligator, parrot, macaw, peccary, and several species of snakes (some poisonous). Lake Nicaragua contains the only freshwater sharks in the world, owing to a prehistoric geological movement that separated the lake from the Pacific Ocean, gradually changing the ocean water into fresh water.

As of 2002, there were at least 200 species of mammals, 215 species of birds, and over 7,500 species of plants throughout the country.

ENVIRONMENT

Nicaragua's major environmental problems are soil erosion, caused in part by cultivation of annual crops on steep slopes, and depletion of upland pine forests for lumber, fuel, and human settlement. The nation lost an average of 3% of its forest and woodland each year between 1990 and 2000. One contributing factor is the use of wood for fuel. Excessive or ineffective use of pesticides to control malaria, along with widespread agricultural use, has resulted in some environmental contamination.

Industrial pollutants have contaminated the lakes and rivers. The nation has 190 cu km of renewable water resource, with 84% of annual withdrawals used for farming and 2% in industrial activity. As of 2002, 93% of Nicaragua's city dwellers and 65% of its rural population have access to improved water sources. Dumping of sewage and chemical wastes has made Lake Managua unsuitable for swimming, fishing, or drinking. Primary responsibility for resource conservation is vested in the Nicaraguan Institute of Natural Resources and Environment (Instituto Nicaragüense de Recursos Naturales y del Ambiente—IRENA), established in October 1979.

In 2003, 17.8% of the total land area was protected, including eight Ramsar wetland sites. According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), threatened species included 6 types of mammals, 8 species of birds, 8 types of reptiles, 10 species of amphibians, 17 species of fish, 2 types of mollusks, and 39 species of plants. Threatened species in Nicaragua include the tundra peregrine falcon, four species of turtle (green sea, hawksbill, leatherback, and olive ridley), the spectacled caiman, and the American crocodile.

POPULATION

The population of Nicaragua in 2005 was estimated by the United Nations (UN) at 5,774,000, which placed it at number 105 in population among the 193 nations of the world. In 2005, approximately 3% of the population was over 65 years of age, with another 42% of the population under 15 years of age. There were 100 males for every 100 females in the country. According to the UN, the annual population rate of change for 2005–10 was expected to be 2.7%, among the highest in the region. The projected population for the year 2025 was 8,318,000. The population density was 44 per sq km (115 per sq mi).

The UN estimated that 59% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 2.91%. The capital city, Managua, had a population of 1,098,000 in that year. Other major cities and their estimated populations are Granada 450,439; León, 145,000; Chinandega, 133,700; Esteli, 119,000; Masaya, 118,000; Matagalpa, 109,100; Chichigalpa, 97,387; Tipitapa, 67,925; and Juigalpa, 54,700.

MIGRATION

During the 1980s, Nicaragua hosted more than 10,000 refugees, mainly from El Salvador and Guatemala. Most have since repatriated. Those who chose to remain have been naturalized or granted permanent resident status.

After the Sandinista takeover in 1979, thousands of Nicaraguans left the country. It was estimated in 1987 that 24,000 had fled to Honduras, 16,000 to Costa Rica, and over 200,000 to the United States, chiefly to Florida. After the defeat of the Sandinistas in the 1990 elections, some 200,000 Nicaraguans returned from abroad. Under the CIREFCA plan, during the period 1989–94, 70,000 Nicaraguans repatriated. In 2002 worker remittances were 29% of GDP. Worker remittances in 2004 amounted to $810 million, or 10.8% of GDP. In 2005, the net migration rate was -1.19 migrants per 1,000 population. The government viewed the migration levels as satisfactory.

ETHNIC GROUPS

The Nicaraguan population is basically mestizo, a mixture of white and Amerindian. There are no census data on racial composition, but estimates place the mestizo component at 69% and the white population at 17%; blacks account for 9% and Amerindians for the remaining 5%.

Traditionally, the Atlantic littoral has been inhabited mainly by blacks from Jamaica, Belize, and various present and former British possessions in the Caribbean. The more densely populated Pacific coast highland has long been basically mestizo in composition. Most Amerindian groups in Nicaragua have been assimilated, but Miskito Amerindians, as well as Sumus, make their traditional homes on the Mosquito Coast and neighboring areas. The Garifuna and Rama are other indigenous groups with a somewhat significant number of people.

LANGUAGES

Spanish is the official language and is spoken by the overwhelming majority of the population. Some Nahuatl and other Amerindian words and phrases are in common use. English is often spoken as a second language at professional levels.

RELIGIONS

Roman Catholicism is the predominant religion, claiming about 72.9% of the population. Approximately 15.1% of the populace are members of evangelical Protestant churches. Another 1.5% are members of the Moravian Church, and 0.1% belong to the Episcopal Church. An additional 1.9% claim membership in other churches or religious groups, which include Mormons, Amish, Mennonites, and Jehovah's Witnesses; 8.5% profess no religion or are atheistic. There are small communities of Jews, Muslims, Unification Church members, Baha'is, and members in the Church of Scientology. Amerindian tribal religionists and spiritists also practice, usually combining elements of Christianity and African religions.

Nicaragua does not have a state religion; however, the Roman Catholic Church seems to have significant political influence in the country. The political party Partidon Camino Cistiano (Christian Path Party) was formed by evangelicals. Churches register with the government for legal recognition in much the same process as other nongovernmental groups. Certain Catholic holidays are recognized as national holidays.

TRANSPORTATION

Main transportation arteries are concentrated in the more densely populated Pacific region. The national road network in 2002 totaled 18,712 km (11,639 mi), of which 2,126 km (1,322 mi) were paved. The Inter-American Highway from Honduras to Costa Rica was completed in 1972. The Pacific Highway begins in Granada and passes through Managua, León, and Chinandega to Corinto. In 2003 there were 64,650 passenger cars and 99,350 commercial vehicles registered.

Pacific Railways of Nicaragua, government-owned with a length of 373 km (231 mi), was shut down in 1993. As of 2004, there were only 6 km (3.7 mi) of narrow gauge railway in operation, mostly for carrying passengers from Chichigalpa to Ingenio San Antonio.

The Naviera Nicaragüense provides regular services to Central America, the United States, and Europe. As of 2005 Nicaragua had no merchant fleet. Corinto is Nicaragua's only natural harbor on the Pacific coast and the major port, handling about 60% of all waterborne trade. Other ports include Puerto Sandino and San Juan del Sur on the Pacific and Puerto Cabezas on the Atlantic coast. A deepwater port at El Bluff/Bluefields on the Atlantic allows ships from Europe, Africa, and the Caribbean to deliver goods to Nicaragua without passing through the Panama Canal. Inland waterways total 2,220 km (1,380 mi), including Lake Nicaragua, Lake Managua and the San Juan River.

Air transportation is important because of limited road and railway facilities. In 2004, there were an estimated 176 airports, only 11 of which had paved runways as of 2005. A state-owned airline, Aerolíneas de Nicaragua (AERONICA), provides services to El Salvador, Costa Rica, Panama, and Mexico. The principal airport is Augusto Sandino, an international terminal at Las Mercedes, near Managua. In 2000 (the latest year for which data is available), 61,000 passengers were carried on scheduled domestic and international flights.

HISTORY

Nicaragua derives its name from that of the Amerindian chief Nicarao who once ruled the region. The first European contact came with Columbus in 1502. At that time the northern part of the country was inhabited by the Sumo Amerindians, the eastern region by the Miskitos, and the region around Lakes Nicaragua and Managua by agricultural tribes.

The first Spanish settlements in Nicaragua were founded by the conquistador Gil González de Ávila in 1522. The cities of Granada and León were founded in 1524 by Francisco Hernández de Córdoba. During the next 300 years—most of the colonial period—Nicaragua was ruled as part of the captaincy-general of Guatemala. The independence of the five provinces of Central America, including Nicaragua, was proclaimed on 15 September 1821. After a brief period under the Mexican empire of Augustín de Iturbide (1822–23), Nicaragua joined the United Provinces of Central America. Nicaragua declared its independence from the United Provinces on 30 April 1838, and a new constitution was adopted.

Nicaragua did not immediately consolidate as a nation. The Spanish had never entirely subdued Nicaragua, and the Mosquito Coast at the time of independence was an Amerindian and British enclave, especially around the Bluefields area. Britain occupied the Mosquito Coast during the 1820s and 1830s, and maintained a significant presence thereafter. Beyond that, Nicaragua was torn apart by a bitter struggle between liberals, based in León, and conservatives, based in Granada.

Yet another factor impeding Nicaragua's development was constant foreign intervention focusing on the trade route through the country. Commodore Cornelius Vanderbilt competed with the British for control of the transisthmian traffic, a rivalry settled by the Clayton-Bulwer Treaty of 1850. In 1853, liberals led by Máximo Jérez and Francisco Castellón revolted and invited the US military adventurer William Walker to help their rebellion. Walker invaded Nicaragua in 1855, capturing Granada and suppressing Jérez, and had himself elected president in 1856. He lasted only one year, and was captured and executed in Honduras in 1860. Conservatives seized control in 1863 and ruled until 1893.

The 30-year conservative reign brought increases in coffee and banana production. Liberals successfully revolted in 1893, making José Santos Zelaya dictator for 16 years. In this time, he incorporated most of the Mosquito territory into Nicaragua, developed railroads and lake transportation, enlarged the coffee plantations, and stirred up revolts among his Central American neighbors. In 1901, by the Hay-Pauncefote Treaty, Great Britain gave the United States the undisputed right to build a Central American canal.

After Zelaya was deposed in a conservative revolt in 1909, US influence on Nicaragua grew steadily until 1933, often at the behest of Conservative requests for help.

The United States placed an American agent in the customhouse in 1911, and US banks extended considerable credit to the bankrupt treasury. US marines and warships arrived in 1912 to support President Adolfo Díaz. US forces remained active in Nicaraguan politics and administered the country directly or through handpicked rulers until August 1925. During this period, the Bryan-Chamorro Treaty of 1914 allowed the United States to build a canal across Nicaragua. After the marines withdrew, the liberals revolted against the US-backed conservative government of Diego Manuel Chamorro and established a government on the Mosquito Coast. The marines returned in 1926 to reimpose Díaz and supervised the electoral victor of the liberal José María Moncada, with whom the conservatives had made peace, in 1928. However, the guerrilla hero General Augusto César Sandino had begun organizing resistance to the marine occupation force in 1927, and fought the US troops to a standstill. With the inauguration of US president Franklin D. Roosevelt's "good neighbor" policy in 1933, the marines were pulled out for the last time. But the marines left a legacy, having built the Nicaraguan National Guard, headed by Anastasio ("Tacho") Somoza García.

In 1934, the liberal Juan B. Sacasa was elected to office. In the same year, however, officers of the National Guard shot Sandino, leaving them unchallenged in Nicaragua, and paving the way for Somoza's overthrow of Sacasa three years later. The Somoza family would rule Nicaragua directly or indirectly for the next 42 years. Somoza made constitutional changes as necessary to prolong his term until he retired in 1947. He returned in 1950, and was assassinated in 1956. Tacho's son, Luis Somoza Debayle, had been president of congress, and immediately became president under the constitution. The next year, he was elected by a rather suspicious 89% of the vote. Though a law was passed in 1962 that prohibited relatives within four generations from immediately succeeding Luis Somoza as president, his younger brother Anastasio Somoza Debayle would become president in 1967 (after the brief presidencies of René Schick Gutiérrez and Lorenzo Guerrero of the National Liberation Party). Though Anastasio's term in office was due to end in May 1972, he had worked out an agreement by March 1971 that allowed him to stand for reelection in 1974, ruling in the interim with a three-man coalition government. Anastasio and his triumvirate drew up a new constitution, signed by the triumvirate and the cabinet on 3 April 1971. Then, after declaring nine opposition parties illegal, Somoza easily won the September 1974 elections.

While Somoza consolidated his hold on Nicaragua, the Sandinista National Liberation Front (Frente Sandinista de Liberación Nacional—FSLN) began to agitate against his rule. At first the group was small and confined to the foothill and mountain regions of Nicaragua. But domestic opposition to Somoza mounted, driven by the family's monopolistic and corrupt economic practices. One powerful example of the corruption was the disappearance of half the US relief aid extended to Nicaragua after a devastating 1972 earthquake. Most of the rebuilding of Managua was done by Somoza-controlled firms on Somoza's land. Throughout the 1970s, Somoza's opposition grew and US support began to dissipate.

In December 1974, guerrillas kidnapped 13 prominent political personalities, including several members of the Somoza family. The group secured a ransom of us$1 million and the release of 14 political prisoners. Somoza responded by declaring a martial law and unleashed the National Guard. The Guard's repressive tactics created even more enemies of the Somoza regime. Repression continued throughout the 1970s, and climaxed in January 1978 with the assassination of Pedro Joaquín Chamorro, editor and publisher of the opposition newspaper La Prensa. The assassins were never found, but most felt that Somoza and the National Guard were behind the killing of this moderate leader from a prominent family. By 1979, loss of support from the Catholic Church and the business community left Somoza without domestic allies. He had become isolated diplomatically, and after the administration of US president Jimmy Carter cut off military aid, his ability to remain in power further weakened. In May 1979, the Sandinistas launched a final offensive. By July, the FSLN overthrew Somoza, who fled the country and was assassinated on 17 September 1980 in Asunción, Paraguay. By this time, an estimated 30,000–50,000 people had died during the fighting.

The Sandinistas engaged in an ambitious program to develop Nicaragua under semi-socialist lines, giving priority to healthcare, improved literacy rates, and land reform. To achieve these ends, they nationalized Somoza's land and commercial interests, initiated agrarian reform, and announced a series of literacy and public health campaigns. Politically, they professed democratic ideals, but delivered only sporadically. A Statute on Rights and Guarantees was adopted, but elections were postponed. As antigovernment activity increased in response to government control of production and distribution, the government became increasingly authoritarian, as reflected by the proclamation of a state of emergency from 1982–87, censorship (particularly felt by La Prensa), and the dissolution of the National Guard. In 1982, a number of former guard members and Somoza supporters ("Somocistas") joined into an anti-Sandinista, counter-revolutionary group of "contras." They were aided by the administration of US president Ronald Reagan, which had also cut off Nicaragua's aid in April 1981 and introduced a trade embargo in response to Nicaragua's support of leftist guerrillas in El Salvador. Though the Sandinistas made overtures to please the United States by pulling 2,200 advisors out of Cuba, the United States continued to support over 12,000 contras' operating out of Honduras and Costa Rica with aid channeled through the CIA and directed toward guerrilla-style offensives that disrupted Nicaragua's agriculture and oil supplies.

Daniel Ortega emerged as the leader of the Sandinistas in the 1984 presidential elections. However, in that election, the major opposition groups withdrew from the election, making it a rather hollow victory. Internationally, the Sandinistas made some gains. In 1986, the World Court ruled that the United States had violated international law by mining the harbors in Nicaragua. Though the United States refused to recognize the decision, the Congress proved more reluctant to fund the Nicaraguan resistance. In 1986, it was revealed that US government funds derived from covert arms sales to Iran had been secretly diverted to provide aid to the contras in violation of a US congressional ban on such aid.

On the domestic scene, the Sandinistas were less successful due to their failure to improve socioeconomic conditions; attempts to pin the economic woes on the civil war fell on deaf ears as the economic situation worsened. The inflation rate skyrocketed in 1988 and reserves dwindled. Price controls had led to serious shortages in basic foodstuffs. Lacking any capital for investment, the situation was becoming hopeless. Still, the Sandinistas continued to seek negotiated settlements for their internal strife. In 1986, they signed an accord with leaders of the Miskito Amerindians, granting autonomy to their region. In August 1987 Nicaragua signed the Arias peace plan for Central America. Nicaragua promised guarantees of democratic rights, and a reduction of hostilities with the contras, including a cease-fire, a reduction in the armed forces, repatriation or resettlement of refugees, and amnesty for the rebels. In exchange, the Nicaraguans were to receive guarantees of nonintervention by outside powers, and a further $9 million from the United States and aid from other countries, tied to the holding of free elections in 1990.

The 1990 elections had a surprise winner—Violeta Chamorro. Heading a 10-party alliance called the National Opposition Union (UNO), Chamorro received 54% of the vote to Daniel Ortega's 41%. UNO also took a majority in the National Assembly. Chamorro moved to liberalize the Nicaraguan economy, but found it sluggish. Austerity measures led to dislocations and political disquiet. The United States delivered miniscule amounts of economic aid, to the disappointment of hopeful Nicaraguans. Nevertheless, Chamorro's government succeeded in driving down hyperinflation that had reached 13,500% to an acceptable single-digit level and in obtaining relief of much of the country's $10 billion foreign debt. Stable economic growth of around 4% from 1994–96 was achieved.

Politically, Chamorro's situation was tenuous. With the Sandinistas still in control of the military, Chamorro had a difficult time achieving a reduction in force. Sandinista organizations and syndicates remained, often striking against the Chamorro government. Meanwhile, the resettlement and repatriation of the contras moved slowly. Some former contras took to the field again, resuming their previous attacks on civilian installations. Chamorro's own coalition, UNO, proved shaky, withdrawing support from her government in 1993 after she attempted to call for new elections. The beleaguered government persisted, but by 1994 the outlook for further progress in unifying the country and implementing democratic and free-market reforms was bleak.

The prospect of a peaceful political transition in the politically polarized country were considered so shaky that international observers were called in for the October 1996 elections, as they had been in 1990. Although the results were later contested due to allegations of corruption, and some irregularities found, the elections proceeded peacefully and without incident. With 80% of the electorate voting, Arnoldo Alemán, the conservative former mayor of Managua and leader of the Liberal Constitutionalist Party (PLC), defeated Sandinista leader Daniel Ortega, with each garnering, respectively, 51% and 38% of the vote. The Liberal Party took 41 of the 93 seats in the Chamber of Deputies, while the Sandinistas took 38; the remaining seats were won by leftist and conservative groups.

President Arnoldo Alemán Lacayo and Vice President Enrique Bolaños Geyer were inaugurated into office on 10 January 1997. Alemán, who had close ties to right-wing groups and American entrepreneurs, worked to instill economic reforms focused on economic growth in an effort to establish Nicaragua's market economy. Throughout Alemán's term, the GDP steadily increased. Despite the legacy of the civil war and years of financial mismanagement, growth continued until 1998, when it was dampened by Hurricane Mitch. The hurricane devastated Nicaragua and Honduras, leaving Nicaragua, already the poorest country in Central America, with $1 billion worth of damage. Worst hit was the agricultural sector, which the country depends on for the majority of its exports. By 1999, Alemán was forced to deal with a trade deficit approaching $900 million. However, despite the destruction caused by Hurricane Mitch, Nicaragua's economy continued to grow slightly, possibly due in part to aid, debt relief, and free market reforms.

Alemán and Daniel Ortega (the Sandinista former president) were charged with involvement in scandals during Alemán's presidential term that made these surprising bedfellows come together in PLC-FSLN talks. In 1998, Daniel Ortega faced accusations from his stepdaughter of sexual abuse dating back to her childhood. Meanwhile, Alemán faced charges that the presidential plane he had been using was actually reported stolen in the United States and that it had been used throughout Central America and Colombia to carry cocaine. Both Ortega and Alemán denied all charges against them, but worked together to create a PLC-FSLN political pact that protected them from scrutiny. This limited the substantive democracy in Nicaragua. These scandals, as well as border disputes, growing poverty, and migration issues all continued to be challenges throughout the rest of Alemán's term.

Enrique Bolaños won the 2001 presidential elections with 56.3% of the vote. Daniel Ortega, the Sandinista leader, came second with 42.3%. Surprising supporters and observers, Bolaños quickly moved to support a judicial corruption investigation against Alemán and to break up the PLC-FSLN alliance. In August 2001, the Bolaños administration brought indictments against Alemán officials. Alemán was personally indicted in August 2002. In December 2002, Alemán was denied his parliamentary immunity, which then forced him to serve 20 years in prison when he was found guilty of corruption and money laundering in December 2003. Yet, from prison Alemán maintained control of the PLC, which kept Bolaños from making further political progress. In 2004, the FSLN and PLC renewed the political pact and worked to extend the powers of the legislature and limit those of the executive. In response to these threats to democracy, Bolaños threatened to declare a state of emergency in January 2005, promoting the UN's involvement via the National Dialogue forum, intended to avert a possible political crisis. In March 2005, the Central American Court of Justice (Corte Centroamericana de Justicia–CCJ), ruled the constitutional reforms being sought by the PLC-FSLN-dominated legislature violated the principle of separation of powers. However, the PLC-FSLN also captured Nicaragua's Supreme Court and could use it to refuse the CCJ's jurisdiction and proceed with the constitutional amendments, despite the ruling. As of June 2005, the Organization of American States was also failing in its effort to mediate negotiations between the political leaders.

During Bolaños's term, the economy expanded slowly, but the president sought to generate further growth by increasing the country's exports and liberating the national economy. Although the country possesses few comparative advantages for economic development, President Bolaños set the goal of incorporating his country into the world economy to reduce poverty and boost employment. As of 2006, experts were predicting that the ratification of the Dominican Republic-Central American Free-Trade Agreement (DR-CAFTA) would boost Nicaraguan exports and energize its economy.

GOVERNMENT

Although constitutionally defined as a democracy, Nicaragua was ruled by the Somoza family from 1934–79; they did not hesitate to suppress political opponents with violence. The last of the constitutions promulgated during the Somoza period, effective 3 April 1974, provided for a bicameral congress, a president elected for a six-year term, and guaranteed political rights. After the FSLN took power as the Government of National Reconstruction in July 1979, this constitution was abrogated and congress dissolved. From July 1979 until November 1984, executive power was vested in a junta composed of five members (three members after April 1980).

The 1984 electoral reforms created an executive branch with a president elected for a six-year term by popular vote and assisted by a vice president and a cabinet. (The presidential term was shortened to five years in 1995.) Legislative power is vested in a 93-member unicameral National Constituent Assembly elected under a system of proportional representation for six-year terms. The electoral process in Nicaragua is said to be one of the most complicated in the Americas as it forces voters to select candidates for the office of president, National Assembly posts, and local municipalities from a vast number of political parties. Further, vote counting is still a tedious, manual process.

As of 2006 the Sandinista constitution of 1987 was in effect; it provides for a democratic system in which elections are held every six years and there is an executive, National Assembly (legislature), judiciary, and electoral council (Consejo Supremo Electoral—CSE). It also called for two new levels of elected government—municipal councils (131 in 1987; 153 as of 2006), and the two autonomous Atlantic coast regional councils.

POLITICAL PARTIES

Nicaragua's traditional two parties were the National Liberal Party (Partido Liberal Nacionalista—PLN) and the Nicaraguan Conservative Party (Partido Conservador Nicaragüense—PCN). The PLN favored separation of church and state, some social legislation, no foreign interference in the political process, and limited land reform. It was supported by government employees, the National Guard, and large segments of the middle and lower classes. The PCN desired government cooperation with the Catholic Church (but also advocated freedom of religion), less government interference in private business, and a regressive tax structure.

When the leftist Sandinista National Liberation Front (FSLN), which was founded in 1962, came to power in July 1979, all political parties except those favoring a return to Somoza rule were permitted. Since the Somozas had all been liberals, the PLN was specifically banned.

Under the Sandinistas, Nicaragua's governing political coalition, the Patriotic Front for the Revolution (Frente Patriótico para la Revolución—FPR), formed in 1980, consisted of the FSLN, the Independent Liberal Party (Partido Liberal Independiente—PLI), the Popular Social Christian Party (Partido Popular Social Cristiano—PPSC), and the Moscow-oriented Nicaraguan Socialist Party (Partido Socialista Nicaragüense—PSN). Opposition parties included the Conservative Democratic Party (Partido Conservador Demócratica—PCD), the Nicaraguan Social Christian Party (Partido Social Cristiano Nicaragüense—PSCN), and the Social Democratic Party (Partido Social Demócrata—PSD).

The National Opposition Union (UNO), under which Violeta Chamorro was elected president in 1990, was a 10-party coalition that included both the Conservatives and the Liberals, as well as several parties formerly aligned with the Sandinistas, including the PLI and the PSD. The PLI was also the party of Vice President Virgilio Godoy. Others included the Christian Democratic Union (UDC), the National Democratic Movement (MDN), the National Action Party (PAN), and the Neo-Liberal Party (PALI). President Arnoldo Alemán's Liberal Alliance, a conservative group that supported the Somoza dictatorship, also supported the National Opposition Union (UNO) candidate and President Violeta Chamorro during her six-year reign. Alemán's support diminished when Chamorro failed to control the UNO coalition; Alemán thus switched to the Liberal Party to launch his presidential campaign in 1996. The disbanded UNO party forced Chamorro to link with the Sandinistas in congress to maintain control of her office; she thus maintained the Sandinista control over the Revolutionary Army. Alemán's main purpose as the National Liberal Party representative was to overturn Chamorro and try to reverse some of the economic policies of her regime.

By the mid-1990s, the UNO coalition had disbanded. Nicaragua had numerous parties ranging across the political spectrum, although the country was dominated by two principal opposed groups—the Liberal Constitutionalist Party (PLC), a right-wing successor to the traditional liberal party, and, on the left, the stillactive FSLN. In the October 1996 presidential election, Arnoldo Alemán, former mayor of Managua and leader of the PLC, was elected with 51% of the vote, supported by a coalition of parties and factions called the Liberal Alliance (AL). Daniel Ortega, the FSLN candidate, won 38% of the vote, with the rest going to candidates from smaller parties. In the legislative elections, 42 of the 93 seats in the National Assembly were won by the National Alliance, with the FSLN winning 36, and the remaining 15 going to candidates from nine other parties. These included the Christian Way (Camino Cristiano), the Conservative Party of Nicaragua (PCN), the center-right Nicaraguan Resistance Party (PRN), the center-left Sandinista Renovation Movement (MRS), and the center-right Independent Liberal party (PLI). Altogether, 24 political parties and popular organizations participated in the 1996 elections.

Alemán and Ortega collaborated in bringing about a PLC-FSLN political pact in 2000 that increased their political influence and reduced their vulnerability to investigation by putting the two major political parties in control of important institutions that combat corruption and could change the election rules to deter smaller parties from challenging PLC-FSLN dominance. Illustrative of this damper on democracy, only one other party was able to register to contest the elections in 2000 and 2001.

In the 2001 parliamentary elections, held concurrently with the presidential election, the PLC won 53.7% of the vote, clinching 47 seats in the 93-member Assembly. The Sandinistas gained 43 seats and the remaining seats went to the Conservative Party of Nicaragua. The 2001 elections witnessed the consolidation of Nicaragua as a two-party system, with an overwhelming majority of votes going to the rightwing PCN and the leftwing Sandinistas.

The Economist Intelligence Unit projected that the prevailing dynamic of party politics in 2006 improved Ortega's chances of winning the presidency. This was because his only opponent in FSLN, Herty Lewites, would likely be barred from running, and the right-wing vote would be split, allowing Ortega to garner enough to win in the election scheduled for November 2006.

LOCAL GOVERNMENT

In July 1982, the nation's departments were consolidated into six regions and three special zones, each to be administered by an official directly responsible to the central government. However, under the Chamorro government, Nicaragua returned to the old system, with fifteen departments and two autonomous regions along the Atlantic coast.

Local elections for mayoralties accompany national elections.

JUDICIAL SYSTEM

Constitutionally, Nicaragua's Supreme Court is an independent branch of the government. However, selection of its 16 members (who serve five-year terms) is proscribed by politics, in that selection is limited to a list submitted by the president and political parties to the National Assembly. The court appoints judges to the lower courts. The selection of magistrates (who decide the Supreme Court's president and vice-president) has been historically political, making de facto judicial independence from executive and legislative pressures unlikely.

The Supreme Court has administrative, criminal, civil, and constitutional matters divisions. The judicial system consists of both civilian and military courts. Military courts investigate, prosecute, and try crimes committed by or against the police or armed forces. Therefore, the military courts have jurisdiction over citizens involved in security-related offenses. In a controversial 1993 decision, a military court exercised jurisdiction to convict a former member of the EPS (Sandinista Popular Army).

In 2004, it was legislated that the judicial career system should be based on merit. This is partly in response to a public lack of confidence in the training or fairness of judges. In 2006 the Economist Intelligence Unit warned that "corruption and influence-peddling in the judicial branch puts foreign investors at a sharp disadvantage in any litigation or dispute, and legal security for business in general is among the lowest in Latin America."

ARMED FORCES

In 2005 Nicaragua's armed forces numbered 14,000 active personnel. The Army had around 12,000 personnel equipped with over 127 main battle tanks, 10 light tanks, and 800 artillery pieces. The Navy had approximately 800 active peresonnel, operating 5 patrol/coastal vessels, and 2 mine warfare ships. The Air Force had 1,200 personnel, with 16 support helicopters but no combat aircraft. Nicaragua's defense budget in 2005 totaled $34.7 million.

INTERNATIONAL COOPERATION

Nicaragua is a charter member of the United Nations, having joined on 24 October 1945; it belongs the ECLAC and several nonregional specialized agencies, such as the FAO, ICAO, ICFTU, the World Bank, UNESCO, UNHCR, UNIDO, ILO, and the WHO. Nicaragua is a member of G-77, the Inter-American Development Bank, the Latin American Economic System (LAES), OAS, the Association of Caribbean States (ACS), and the Río Group. It is one of five members of the Central American Bank for Economic Integration (BCIE) and the Central American Common Market (CACM). The country also participates in the Central American Parliament (PARLACEN). In 2004, Nicaragua, the United States, Costa Rica, El Salvador, Guatemala, Honduras, and the Dominican Republic signed the US–Central America Free Trade Agreement (CAFTA). The agreement must be ratified by all participating countries before it enters into force.

Nicaragua is part of the Nonaligned Movement and a signatory of the 1947 Río Treaty, an inter-American security agreement. It is also a part of the Agency for the Prohibition of Nuclear Weapons in Latin America and the Caribbean (OPANAL) and the Organization for the Prohibition of Chemical Weapons. In environmental cooperation, Nicaragua is part of the Basel Convention, the Convention on Biological Diversity, Ramsar, CITES, the Kyoto Protocol, the Montréal Protocol, MARPOL, the Nuclear Test Ban Treaty, and the UN Conventions on the Law of the Sea, Climate Change and Desertification. The nation is also part of the Central American-US Joint Declaration (CONCAUSA).

ECONOMY

Nicaragua has long had, in effect, two economies: an export segment, producing mainly cotton, meat, coffee, and sugar, and a subsistence segment, tying a majority of both urban and rural Nicaraguans to an impoverished existence. Nicaragua has been one of the poorest countries in the western hemisphere, partially due to enormous external debt, low per-capital income, massive unemployment, and one of the most unequal income distributions in the world. Some 50% of the population lived below the poverty line. The 10% of the population with the lowest income consumed 1.2% of GDP, whereas 10% of the population with the highest income consumed 45% of GDP. As of 2004, per capita GDP was $2,300.

Agriculture and forestry remain mainstays of the Nicaraguan economy, employing about 30.5% of the labor force, but the services sector is increasingly important, employing about 52.2% of the labor force. Industry employs 17.3% of the labor force. Agriculture, industry, and services comprise 20.7%, 24.7%, and 54.6% of the GDP.

During 1960–64, the GDP increased by an annual average of 8.1%, the highest rate in Latin America. Annual growth ranged from 4–6% during 1965–73, largely because of favorable world prices for Nicaraguan commodities. The 1972 earthquake that struck Managua caused material losses estimated at $845 million, but the agricultural sector was left largely unscathed.

The civil war of the late 1970s disrupted the economy. Infrastructure was destroyed in the war and a US blockade was put in place against Nicaragua, resulting in the near-collapse of the economy. In 1978, the GDP fell by 7.9%; and in 1979, the year of the Sandinista takeover, by 25%. Under the Sandanista regime 80% of the economy was nationalized. Massive public spending resulted in a GDP growth of 10.4% in 1980 and 7% in 1981. However, because of floods in May 1982, a weak international market for export crops, the virtual collapse of the CACM, direct and indirect economic pressure from the US government, and disruption by the contras, the economy suffered a GDP decline of 1.4% in 1982. Because of shortages, rationing of soap, flour, and cooking oil was introduced in 1982. In 1983, high world prices and a bumper harvest boosted GDP growth to 4.6%, but decline set in again from 1984 to 1986. Across this three year period, GDP declined 6.7%, and on a per capita basis, with population growth averaging 3.4% a year, the decline was 16.3%. The average annual inflation rate during 1980 to 1984 was about 35%, but in 1985 this inflation jumped to 219.5%. In 1986 the United States imposed a formal trade embargo on Nicaragua, and inflation (as measured by consumer prices) soared for the rest of the decade: 681.6% in 1986; 912% in 1987; 14,316% in 1988; 4,770% in 1989; and 12,338% in 2000.

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. The candidate of the National Opposition Union (UNO), Violeta Barrios de Chamorro, whose campaign received financial support from the United States, won the election. She took over a country with a controlled economy, uncontrolled inflation, and debt outstanding at 508% of GDP. 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.

Nicaragua began free market reforms in 1991. Despite some setbacks, it made dramatic progress, privatizing 351 state enterprises, reducing inflation from 775% in 1990 to 12.4% in 1994 to 7.3% in 1997. Foreign debt had risen 638.4% as Nicaragua was given renewed access to IMF funding, but by 1997, this ratio had declined to 296.7% of GDP. The GDP continued to contract from 1991 to 1993, but 1994–97 GDP growth averaged 4.35%. As a result of the strong decline in foreign debt, the country's current account balance declined as a percentage of GDP from 60.0% in 1992 to 30.3% in 1997. In addition, the government's budget deficit in 1997 stood at 9.7% of GDP (before grants), down considerably from 20.3% in 1990. The election of Arnoldo Alemán in 1996 served to continue the social and economic reforms. (This trend was undermined somewhat when, in December 2002, Alemán was indicted for diverting $100 million of state funds for his own and others' personal enrichment during his term in office.)

Damage caused by Hurricane Mitch in 1998 reduced the GDP to 4% for that year, and shot inflation up to 18.5%, but an in-pouring of foreign assistance and activity on reconstruction projects pushed GDP growth to 7.4% in 1999 (the highest since 1982), while inflation fell to a new low of 7.2% by the end of the year. Growth continued in 2000, up 4.3% with inflation at 9%. However, in 2001, the global slowdown, and, in particular, a glut on the coffee market, drought, and lower demand in the United States for textiles and other manufactured goods from Nicaragua, reduced growth to 2%. Inflation was at 7.3% that year.

From 2001–05, the real GDP growth rate fluctuated from year to year, while the inflation rate dipped briefly in 2002 and continued steadily upward through 2005. In 2002, real GDP growth was 0.8% and inflation was 3.7%. The years 2003 and 2004 saw an increase in both GDP growth (2.3% and 5.1%, respectively) and inflation (5.3% and 8.5%, respectively). It was projected that GDP growth would fall to approximately 3.6% in 2005, and that inflation would continue to rise to approximately 10.1%. External debt was $4.573 billion, approximately one-third of the $12.34 billion of GDP for that year.

INCOME

The US Central Intelligence Agency (CIA) reported that in 2005 Nicaragua's gross domestic product (GDP) was estimated at $16.1 billion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. The per capita GDP was estimated at $2,800. The annual growth rate of GDP was estimated at 3.5%. The average inflation rate in 2005 was 10.1%. It was estimated that agriculture accounted for 16.8% of GDP, industry 27.6%, and services 55.6%.

According to the World Bank, in 2003 remittances from citizens working abroad totaled $439 million or about $80 per capita and accounted for approximately 10.6% of GDP. Foreign aid receipts amounted to $833 million or about $152 per capita and accounted for approximately 21.0% of the gross national income (GNI).

The World Bank reported that in 2003, household consumption in Nicaragua totaled $2.99 billion or about $546 per capita based on a GDP of $4.1 billion, measured in current dollars rather than PPP. Household consumption included expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated during 1990–2003, household consumption grew at an average annual rate of 3.7%. It was estimated that in 2001 about 50% of the population had incomes below the poverty line.

LABOR

In 2005, Nicaragua's workforce was estimated at 2.17 million. As of 2003, the labor force was estimated to have been distributed as follows: services 52.2%; agriculture 30.5%; and industry 17.3%. As of 2005, unemployment was estimated at 6.4%, although 46.5% of the workforce is said to be underemployed.

Nicaragua became a member of the ILO in 1919, withdrew in 1938, and rejoined in 1957. The former labor code, effective January 1945, was patterned on Mexican labor legislation. In establishing and protecting the rights of workers, emphasis was placed on law rather than collective bargaining. A labor code, effective as of 1996, allows all public and private-sector employees to form and join unions and legally recognizes cooperatives, as well as the right to strike. However, administrative requirements make it difficult for a union to engage in a legal strike. As of 2001, approximately 15% of the labor force was organized.

Children may not work until the age of 14 but this regulation is not effectively enforced and many children work in agriculture and in cities as urban street-peddlers. The maximum legal workweek is 48 hours, with one day of rest per week. The minimum wage varies from sector to sector throughout the formal economy. In 2001, the monthly minimum wage was $47 in agriculture, $118 in construction, and $75 in manufacturing. This does not provide a family with a decent standard of living. The legal workweek is set at 48 hours with one day of rest. The labor code attempts to bring work conditions up to the international standard.

AGRICULTURE

Nicaragua's economy is predominantly agricultural. Arable land amounted to 2,161,000 hectares (5,340,000 acres), or about 17.8% of the total land area. Some 61,000 hectares (150,700 acres) were under irrigation in 2003. The harvest season begins in November and lasts through January; during the rest of the year, most rural laborers are unemployed. Plantings begin in May immediately before the wet season.

The main agricultural exports are coffee, cotton, sugar, and bananas. Nontraditional exports are growing and include: honeydew melons, cantaloupe, sesame seed, onions, baby corn, asparagus, artichokes, and cut flowers. Sorghum, cacao, yucca, tobacco, plantains, and various other fruits and vegetables are produced on a smaller scale for the local markets. Bananas were once nearly totally decimated by Panama disease. By the late 1960s, however, production had begun a slow recovery, reaching 135,000 tons in 1992 (up from 29,000 tons in 1970). Banana production in 2004, however, was just 61,000 tons. Cottonseed production has expanded from virtually zero prior to 1950 to 105,700 tons in 1985, before returning to 1,860 tons by 2004. During the 1980s, coffee was severely threatened by contra activities; production of 71,000 tons in 2004 was an improvement over the 28,000 tons produced in 1990. In 2004, 4,090,000 tons of sugarcane were produced. Major food crops in that year were corn, 522,000 tons; rice, 242,000 tons; sorghum, 114,000 tons; and beans, 224,000 tons.

During the Somoza era, most of the titled land was held by large landowners (with farms of 140 hectares/346 acres or more), who owned some 60% of the land while representing only 5% of the farming population. About 36% of the farm population controlled individual holdings of less than 3.5 hectares (8.6 acres). The Sandinista government expropriated almost one million hectares (2.5 million acres) of land, of which over two-thirds became state farms and 280,000 hectares (692,000 acres) were turned into peasant cooperatives. Agriculture was severely disrupted in 1979–80 because of the revolution, but by 1981 it had recuperated. In May 1982, severe floods caused damages estimated at $180 million; the withdrawal of the Standard Fruit Co. in the following October caused losses of $400,000 per week in foreign exchange earnings. Bad weather continued to plague the sector through 1984. An estimated 450,000 hectares (1,111,500 acres) of land were redistributed in 1985. From 1983 to 1987, the contras sought to destabilize Nicaraguan agriculture by damaging agricultural machinery, destroying crop storage sheds, and intimidating farm workers. After eight years of steady decline, the agricultural sector grew by a modest 1–2% in 1992. During 1990–2000 agricultural output grew by a yearly average of 5.7%. During 2002–04, output was up another 6.5% from 1999–2001. In 2004, the agricultural trade surplus was $210.8 million.

ANIMAL HUSBANDRY

Nicaragua, the second-largest cattle-raising country of Central America (after Honduras), had 3.5 million head of dairy and beef cattle in 2005. There were also 268,000 horses, 123,000 hogs, and 57,000 mules and donkeys. Total beef production in 2005 was 152,000 tons. Meat exports, perennially one of Nicaragua's most important trade commodities, were valued at $23 million in 1981 but fell to $7 million by 1987. By 2004, meat exports had recovered, to $111.2 million. The primary markets for Nicaraguan beef are the United States, El Salvador, and Puerto Rico. In 1990, Nicaragua access to the US beef products market was restored, and since then the livestock industry has been a profitable business and a key economic indicator for the country. Milk production in 2005 totaled 612,945 tons.

FISHING

Commercial fishing in the lakes and rivers and along the seacoasts is limited. In 2003, the total catch amounted to 22,331 tons, over 97% of which came from marine waters. About 80% of the marine catch comes from the Atlantic coast. Shrimp and lobster catches in 2003 amounted to 10,753 and 3,922 tons, respectively. Exports of shrimp and lobster expanded after the 1960s and by 1980 had reached an export value of $25.9 million. In 2003, exports of fish products reached $67.6 million. Commercial fishing was trying to diversify its catch to include more red snapper, grouper, and flounder.

After the Sandinistas took over, the fishing industry was nationalized. The fishing port at San Juan del Sur was expanded in the early 1980s to service the tuna fleet. In late 1991, the government privatized the Atlantic seafood packaging plants, causing seafood production to rise.

FORESTRY

About 38.6% of Nicaragua is forested. The country has four distinct forest zones: deciduous hardwood, mountain pine, lowland pine, and evergreen hardwood. Nicaragua's largest remaining timber resources, in the evergreen hardwood zone, are largely inaccessible. Nicaragua is the southernmost area of natural North American pine lands. The most well-known cloud forest in Nicaragua is Selva Negra (Black Forest), in the Matagalpa region. In 2004, roundwood production totaled 5,999,000 cu m (212 million cu ft), with 98% burned as fuel wood. Sawn wood production was about 45,000 cu m (1.6 million cu ft) that year.

MINING

Gold, a leading export commodity, underwent a resurgence in the 1990s. After a long period of low production, gold output almost tripled in the late 1990s, from 1,500 kg in 1996 to 4,450 in 1999. In 2003, output was 3,029 kg. Gold and silver mines were in León, Chontales, and Zelaya departments. Mineral production for 2003 included silver, 2,040 kg, down from 2,198 kg in 2002; marine salt, 31,320 metric tons, up from 29,710 metric tons in 2002; and crude gypsum and anhydrite, 30,642 metric tons, up from 28,153 metric tons in 2002. Bentonite, lime, limestone, sand and gravel, and crushed stone were also produced. Deposits of iron, copper, lead, antimony, and zinc have been uncovered.

In the mid-20th century, Nicaragua ranked roughly 15th in the world in gold production, and the development of gold mining was emphasized during the Sandinista era, when the entire mining industry was nationalized. Gold exports reached $39.9 million in 1980, fell to $15 million in 1982, and were suspended through 1985. The Corporación Nicaragüense de Minas (INMINE), a subsidiary of the government holding company, controlled most of the country's mineral exploration and production. In 2001, the congress passed a Mining Code despite opposition from small-scale miners and environmentalists, who argued the law would unduly benefit multinational companies and lead to environmental damage; Congress was investigating ways to protect the interests of small-scale miners, and the law made submission of environmental impact statements mandatory. In 1997, the ban on new concessions was lifted.

ENERGY AND POWER

Although Nicaragua has no proven reserves of oil, natural gas, or coal, the country is one of only three nations in Central America (the others are Costa Rica and El Salvador) to operate an oil refinery.

Nicaragua imported all of the petroleum products it used in 2003. Imports that year averaged 27,950 barrels per day. In 2002, imports averaged 26,030 barrels per day, of which, an average of 16,560 barrels per day was crude oil. Demand for refined petroleum products averaged 25,770 barrels per day in 2003, up from 2002's average of 25,410 barrels per day. Nicaragua's refinery is the smallest of the three operated in Central America. Located in Managua, the facility has a capacity of 20,000 barrels per day. However, refined petroleum output in 2002 averaged only 17,010 barrels daily.

Nicaragua had no recorded imports or consumption of natural gas or coal in 2002.

The majority of the electric power generated in Nicaragua came from conventional thermal sources. Production of electricity in 2002 totaled 2.514 billion kWh, of which 78.2% came from fossil fuels, 11.9% from hydropower, and the rest from other renewable sources. Consumption of electricity in 2002 was 2.4p billion kWh. In 2002, Nicaragua had a total generating capacity of 0.641 million kW, of which approximately 16% was hydroelectric and 11.9% was geothermal.

INDUSTRY

Nicaraguan industry expanded during the 1970s but was severely disrupted by the civil war and nationalization in 1979. In 1980, the manufacturing sector began to recuperate, and modest growth continued through 1984. In 1985, however, net output again declined, by an estimated 5%. In the mid-1980s, there were still many state enterprises, some of them created by nationalization; in 1985, the government announced plans for a mixed economy. All state monopolies except for public utilities were eliminated; price controls were ended; and more than 300 state enterprises were privatized after 1990.

In 2000, the industrial sector contributed approximately 23% to the GDP and employed approximately 15% of the labor force. The industrial production growth rate in 2000 was 4.4%. In 2004, the industrial sector contributed 24.7% to the GDP and employed about 17.3% of the labor force. Among the most important industries are processed food, chemicals, metal products, textiles, clothing, petroleum refining and distribution, beverages, shoes, and wood. Nicaragua has one oil refinery, with a production capacity of 20,000 barrels per day. The services sector has become the major player in the country's economy since the reforms instituted by the Chamorro government. Services account for 52.2% of GDP and include commerce, financial services, transportation, energy and construction. The services and industrial sector share of GDP and the labor force has been growing as the shares in agriculture have decreased.

The construction sector rebounded after the destruction wrought by Hurricane Mitch in 1998, but slowed in 2000. The building of shopping centers and hotels, the industrial production of meat and poultry, and the development of transportation and communications were all growth sectors as of the early 2000s. Manufacturing in free trade zones rose 22.9% in 2000 to $250 million in 2005. Manufacturing overall accounted for around 20% of GDP.

SCIENCE AND TECHNOLOGY

Among Nicaragua's scientific learned societies and research institutes are the Geophysical Observatory, founded in 1980, the Nicaraguan

Country	Exports	Imports	Balance
World	584.5	1,835.8	-1,251.3
United States	201.3	477.7	-276.4
El Salvador	104.2	83.6	20.6
Costa Rica	49.1	164.4	-115.3
Honduras	43.4	32.4	11.0
Mexico	27.9	154.4	-126.5
Guatemala	25.9	127.9	-102.0
Canada	21.3	12.6	8.7
United Kingdom	16.8	14.4	2.4
Spain	15.9	26.8	-10.9
Russia	14.5	14.4	0.1
(…) data not available or not significant.

Society of Psychiatry and Psychology, founded in 1962, and the National Center of Agricultural Information and Documentation, founded in 1984. Part of the Ministry of Agriculture, all three institutes are in Managua. Nicaragua has six universities and colleges offering degrees in agricultural studies and other scientific studies. In 1987–97, science and engineering students accounted for 33% of college and university enrollments. The National Museum of Nicaragua, founded in 1896 in Managua, has exhibits concerning archaeology, ceramics, zoology, botany, and geology.

As of 2002 total research and development (R&D) expenditures amounted to $6.011 million, or 0.05% of GDP. In that same year, there were 50 researchers and 39 technicians engaged in R&D per million people. High technology exports in 2002 totaled $6 million or 5% of the country's manufactured exports.

DOMESTIC TRADE

Managua is the principal trading and distribution center and all importers and exporters have offices there. Exporters, except those concerned with cotton, coffee or lumber, are usually importers also. Managua has a variety of retail establishments, including department stores and numerous general stores; many small shops are in private homes. Managua also has a central market to which merchants come daily with all types of produce and domestic and imported consumer goods. Retail sales are mainly for cash. Price controls apply to pharmaceuticals, sugar, domestically produced soft drinks, national cigarettes, and liquefied natural gas.

The usual business hours are from 8 am to noon and from 2:30 to 5:30 pm, Monday through Friday, with a half-day on Saturday. Banking hours are from 8:30 am to noon and from 2 to 4 pm on weekdays; from 8:30 to 11:30 am on Saturday.

FOREIGN TRADE

Nicaragua's total trade volume grew considerably during the 1970s because of the country's membership in the CACM and because of worldwide inflation. Following the Sandinista revolution and the virtual collapse of the CACM because of political instability in the region, Nicaragua's imports and exports fell by more than half from 1976 to 1985.

By 1986, Latin America and EC member countries, particularly Germany, accounted for the bulk of Nicaragua's trade volume; the Communist bloc had filled the breach opened by the shutting down of US commerce. The Chamorro government changed Nicaragua's trading partners as it reduced trade barriers in 1991. The government issued export promotion incentives with special tax benefits for products sold outside Central America. The Communist bloc was discarded in favor of the United States and South American countries, but Germany remained an important partner. By the Law of Free Trade Zones, Nicaragua waived all duties for imports used in the free zones. The result was widespread availability of US goods in several newly established Managua supermarkets.

One of the key engines of economic growth has been production for export. Although traditional products such as coffee, meat, and sugar continue to lead the list of Nicaraguan exports, the fastest growth was in nontraditional exports: maquila goods (apparel), bananas, gold, seafood, and agricultural products such as sesame, melons, and onions.

The most important commodity export from Nicaragua is coffee (28%), followed by shellfish (19%) and meat (9.4%). Other exports include sugar (5.8%), oil seeds (5.2%), and gold (3.6%).

Money spent on principal imports well outweighed money earned from exports in 2004. Nicaragua spent $733.8 million on consumer goods, $646.1 million on intermediate goods, $404.6 million on capital goods, and $425.9 million on oil and derivatives. This contrasts with exports: $126.8 million earned from coffee, $110.4 million from beef, $80.5 million from shrimp and lobster, and $36.8 million from sugar.

In 2004, Nicaragua's exports were absorbed by the United States (64.8%), El Salvador (7%), and Mexico (3.6%). In the same year, 22.6% of imports came from the United States, 8.5% from Costa Rica, 8.4% from Venezuela, 6.8% from Guatemala, 5.8% from Mexico, 4.9% from El Salvador, and 4.5% from South Korea. Exports totaled approximately $750 million and imports totaled approximately $2.02 billion, resulting in a substantial trade deficit of $1.27 billion.

Nicaragua has been reducing trade barriers and working towards integration with its Central American neighbors, the United States and the Dominican Republic in the Dominican Republic-Central American Free-Trade Agreement (DR-CAFTA). The DR-CAFTA was expected to take effect in 2006, but ratification had not yet been accomplished by midyear. Nicaragua has a free trade agreement with Mexico and trade links with Taiwan.

BALANCE OF PAYMENTS

An adverse balance of trade with Nicaragua's major trading partners is the major factor in its deficit. Incoming capital in the form of public and private loans, as well as foreign capital investment and tourism, traditionally offset amortization and interest payments abroad. (The tourist industry has grown substantially in recent

Current Account			-779.5
Balance on goods		-972.1
Imports	-2,021.2
Exports	1,049.1
Balance on services		-123.1
Balance on income		-203.2
Current transfers		1,817.3
Capital Account			261.6
Financial Account			-9.2
Direct investment abroad		…
Direct investment in Nicaragua		201.3
Portfolio investment assets		…
Portfolio investment liabilities		…
Financial derivatives		…
Other investment assets		-16.0
Other investment liabilities		-194.5
Net Errors and Omissions			26.4
Reserves and Related Items			500.7
(…) data not available or not significant.

years and has become the third-largest source of foreign exchange.) The current account balance sustained a deficit averaging 30% of GDP throughout the 1990s.

The US Central Intelligence Agency (CIA) reported that in 2004 the purchasing power parity of Nicaragua's exports was $750 million while imports totaled $2.02 billion, resulting in a continued substantial trade deficit.

BANKING AND SECURITIES

The banking system, nationalized in July 1979, is under the supervision of the comptroller general. The National Bank of Nicaragua, established in 1912, has been government-owned since 1940. In 1979, the bank was reorganized to become the National Development Bank. The Central Bank of Nicaragua (Banco Central de Nicaragua), established in 1961, is the bank of issue and also handles all foreign exchange transactions. As of 1979, deposits in foreign banks were prohibited, but in May 1985, the establishment of private exchange houses was permitted. In 1990, legislation was passed that allowed for the establishment of private banks. There are no state-owned commercial banks in Nicaragua.

By 2002, there were at least seven private banks operating, after several mergers in the first few years of the new millennium. Three banks closed in 2000, and another was absorbed into another bank the following year. Banco de la Producción (BANPRO) assumed the performing loans in INTERBANK's portfolio, while the Central Bank took over control of the nonperforming loans. Banco de Finanzas (BDF) assumed BANCAFE's good loans in a similar deal. Also, Primer Banco Inmobiliario (PRIBANCO) merged with BANPRO, and Banco Mercantil (BAMER) merged with Banco de Crédito Centroamericano (BANCENTRO). The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $338.7 million. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $2.1 billion.

A small stock market began operations in the late 1990s.

INSURANCE

In 1979, the Nicaraguan Institute of Insurance and Reinsurance took over all domestic insurance companies. There were five domestic insurance companies operating in 2000, including the government-owned Iniser; Seguros America, Seguros Centroamericanos, Seguros Metropolitana, and Seguros Pacificano. All private insurance companies were majority owned by Nicaraguan banks.

PUBLIC FINANCE

Since the mid-1960s, government spending has consistently exceeded revenues. During the Sandinista regime, detailed public finance budgets were not a priority. The government budget deficit shrank from 18% of GDP in 1987 to 4% in 1998, while government revenues consistently reflected almost one-third of GDP. Nicaragua reached the decision point under the Heavily Indebted Poor Countries (HIPC) debt relief initiative in late 2000.

The US Central Intelligence Agency (CIA) estimated that in 2005 Nicaragua's central government took in revenues of approximately $1.1 billion and had expenditures of $1.3 billion. Revenues minus expenditures totaled approximately -$224 million. Public

Revenue and Grants	15,893	100.0%
Tax revenue	9,422	59.3%
Social contributions	2,468	15.5%
Grants	3,002	18.9%
Other revenue	1,001	6.3%
Expenditures	16,559	100.0%
General public services	…	…
Defense	…	…
Public order and safety	…	…
Economic affairs	…	…
Environmental protection	…	…
Housing and community amenities	…	…
Health	…	…
Recreational, culture, and religion	…	…
Education	…	…
Social protection	…	…
(…) data not available or not significant.

debt in 2005 amounted to 100.3% of GDP. Total external debt was $4.054 billion.

The International Monetary Fund (IMF) reported that in 2003, the most recent year for which it had data, central government revenues in córdobas were c$15,893 million and expenditures were c$16,559 million. The value of revenues in US dollars was us$1,053 million, based on a principal exchange rate for 2003 of us$1 = c$15.10 as reported by the IMF.

TAXATION

As of 2005, the standard corporate income tax rate was 30%. Capital gains are treated as ordinary income and are taxed at the corporate rate. Dividends are subject to a 10.5% withholding rate, but if distributed by an entity that has already paid income tax, the dividends are not considered taxable income. Interest and royalties are subject to withholding taxes of 22.5% and 21%, respectively. However, income received from motion pictures and radio and television shows are subject to a 9% withholding rate.

The individual income tax ranged from 10–25%. The main indirect tax is Nicaragua's value-added tax (VAT), introduced in January 1975 with a standard rate of 6%. As of 2005, the standard rate had risen to 15%. Basic necessities were zero-rated such as water and power, as well as exports and some imports. Exempted from VAT were finance, petroleum products, publications and medicines. Other taxes included a luxury tax; a 1% municipal tax levied on sales; and a 1% real estate tax on 80% of assessed value.

CUSTOMS AND DUTIES

In 1990, the government's liberalized import schedule allowed private sector imports for the first time in 11 years. Import licenses are only required for the import of sugar. Nicaragua follows the CACM common import tariff schedule with rates ranging from 5–15%. Duties are set on an ad valorem basis, and there are specific consumption (usually less than 15%) and sales taxes (15%). However, a small number of agricultural products are subject to higher rates, among them are chicken parts and rice. A VAT of 15% is placed upon most items based upon the item's CIF (cost, insurance and freight) value plus the duty. Agricultural raw materials are exempt. An industrial free zone operates at Las Mercedes near the Managua international airport.

Nicaragua has free trade agreements with Mexico and the Dominican Republic; and is a member of the Central American Common Market (CACM). The country is also a Caribbean Basin Initiative beneficiary.

FOREIGN INVESTMENT

Until the 1979 revolution, Nicaragua encouraged private investment. Virtually no restrictions were imposed on the remittance of profits or the repatriation of capital. The economic and political climate for foreign investors in the 1980s was bleak, despite the claim that the Sandinista government was prepared to offer more favorable investment terms (including 100% foreign ownership and repatriation of profits) than the Somoza government had provided. As of 1984, direct US investment in Nicaragua had stopped completely. However, in the 1990s Nicaragua began free market reforms, privatized over 350 state enterprises, decreased inflation from 13,500% to 5.3%, and cut foreign debt in half.

Under the New Foreign Investment Law, the government of Nicaragua has concentrated most of its efforts on the expansion and promotion of foreign and national investment. This law, among other things, guarantees the repatriation of invested capital and generated capital. Also, it allows for 100% foreign ownership in all areas. Foreign private capital inflows doubled from $97 million in 1996 to $184 million in 1998 and peaked at $300 million in 1999. For the period 1998–2000, Nicaragua's share of world FDI inflows was over three times its share of world GDP. In the global slowdown in 2001, FDI inflows to Nicaragua fell to $132 million in 2001, and then to an estimated $95 million in 2002. Most of the FDI during those years was invested in cellular communications, maquila operations, and tourist projects.

About 25 US companies, wholly or partly owned subsidiaries, do business in Nicaragua. The largest investments are in the energy, communications, manufacturing, fisheries, and shrimp farming sectors. In addition to those sectors, opportunities for further investment abound in tourism, construction, services, mining, and agriculture.

Foreign investment in commercial establishments in Nicaragua has been on the rise. Modern shopping malls have been built by investors from Taiwan and El Salvador, and supermarkets have been built by Costa Rican investors. US fast-food franchises have prospered and car sales from Asia have proliferated since 1999. However, formal commerce growth potential is limited by low income levels. Furthermore, property disputes, a corrupt judiciary, political unease, and a low-skilled workforce are all factors that serve to discourage further investment in Nicaragua.

ECONOMIC DEVELOPMENT

The Somoza government's 1975–79 National Reconstruction and Development Plan had as its major objective the improvement in living conditions through increased employment, continuing reconstruction of Managua, reduction in the economy's dependence on the external sector, acceleration of regional development, and strengthening of the country's role in CACM. The plan was disrupted by the civil strife in the late 1970s.

After the 1979 revolution, the government nationalized banking, insurance, mining, fishing, forestry, and a number of industrial plans. Although the government officially favored a mixed economy, in practice the private sector took second place in a development strategy that focused on public investment and control.

In response to the macroeconomic problems that arose in 1992, a series of measures were adopted by the Chamorro administration aimed at consolidating the stabilization process, increasing the competitiveness of exports and establishing a base for the promotion of growth. However, long-term success at attracting investment, creating jobs, and reducing poverty depends on its ability to comply with International Monetary Fund (IMF) programs, resolve the thousands of Sandinista-era property confiscation cases, and open its economy to foreign trade.

In 1999 the Alemán government was faced with poverty (over 70%), unemployment and underemployment (over 50%), one of the highest per capita debt ratios in the world ($6 billion), and one of the highest population growth rates of the hemisphere (2.8%). Alemán signed an IMF Structural Adjustment Program for Nicaragua that aimed at cutting the fiscal deficit, continuing liberalization, and maintaining monetary stability.

Nicaragua received at least $2.5 billion for reconstruction in the aftermath of Hurricane Mitch, debt deferral until 2001, and debt forgiveness through the Highly Indebted Poor Countries (HIPC) Initiative. In December 2002, the IMF approved a three-year $129 million Poverty Reduction and Growth Facility (PRGF) Arrangement for Nicaragua. However, in 2003, the IMF threatened to sever financial assistance to the country in the midst of a budget dispute between President Enrique Bolaños and the National Assembly. Bolaños had submitted his 2003 budget—in accordance with IMF criteria—to the National Assembly, which revised it, violating terms of the agreement with the IMF. The IMF also stipulated the government would have to sell off state-owned hydroelectric dams and the hydroelectric company, and 51% of the shares in the national telephone company, ENITEL. In 2002, the government began privatizing management of water systems. Despite the IMF threats to cut its aid to the country, Nicaragua still received $541.8 million in total foreign aid in 2003.

The Bolaños administration undertook macroeconomic policies that contributed to 5.1% growth in GDP in 2004. With increased tax collection and less public spending, fiscal deficits declined. Yet, unemployment and underemployment remain high at 12.2% and 35.4%, respectively. Foreign aid (donations and debt relief) comprised 42% of Nicaragua's GDP in 2004. In 2005, G-8 finance ministers agreed to forgive Nicaragua's foreign debt due to its HIPC classification. While debt relief under the HIPC program of the World Bank will continue, the debt relief by the G-8 countries was dependent upon Nicaragua's putting a PRGF (Poverty Reduction and Growth Facility) back in place. It was hoped that involvement in Dominican Republic-Central American Free-Trade Agreement (DR-CAFTA) would attract foreign, provide jobs, and spur steady economic development and growth.

SOCIAL DEVELOPMENT

A system of mandatory individual accounts replaced the social insurance system in 2004. All working persons are covered. These programs are financed by a 6% of payroll contribution from employers and a 4% of earnings contribution from employees. Retirement is set at age 60 for most workers. Employers cover the entire cost of work injury insurance. Medical care is provided to treat work injuries and occupational diseases. Family allowances vary depending on earnings and the age of the children.

There is no official discrimination against women and a number of women hold government positions. However, women continue to suffer de facto sex discrimination in many segments of society. They tend to hold traditionally low-paid jobs in the health, education, and textile sectors while occupying few management positions in the private sector. Sexual harassment in the workplace is prevalent despite laws designed to protect women. Domestic and sexual violence are common, and the perpetrators are seldom prosecuted. Dire economic circumstances force many children to work to contribute to household income. Many children work for low wages on banana or coffee plantations, while in urban areas, children often work as vendors in the streets.

Human rights abuses have been on the decline but there are continued reports of the mistreatment of detainees, although torture is punishable by law.

HEALTH

As of 2004, there were an estimated 164 physicians and 107 nurses per 100,000 people. Total health care expenditure was estimated at 12.5 % of GDP. Approximately 79% of the population had access to safe drinking water and 84% had adequate sanitation.

Slow progress in health care was made from the 1960s through the 1980s, as the crude death rate dropped from 19 per 1,000 people in 1960 to and estimated 4.8 in 2002. During 2005, the infant mortality rate was 29.11 per 1,000 live births and average life expectancy was 70.33 years. The maternal mortality rate was 150 per 100,000 live births. The fertility rate was 3.5 births per woman in 2000; 44% of married women (ages 15 to 49) used some form of contraception.

Malnutrition and anemia remain common, as do poliomyelitis, goiter, and intestinal parasitic infections (a leading cause of death). The prevalence of child malnutrition was 25% of children under five. The goiter rate was 4.3 per 100 school-age children. Immunization rates for children up to one year old were as follows: tuberculosis, 99%; diphtheria, pertussis, and tetanus, 94%; polio, 99%; and measles, 94%.

The HIV/AIDS prevalence was 0.20 per 100 adults in 2003. As of 2004, there were approximately 6,400 people living with HIV/AIDS in the country. Common diseases reported in Nicaragua were malaria, cholera, and tuberculosis.

HOUSING

Both urban and rural dwellers suffer from a dire lack of adequate housing. As a result of the 1972 earthquake, approximately 53,000 residential units were destroyed or seriously damaged in the Managua area. The Sandinistas launched housing-construction and tree-planting programs, but were hampered by a shortage of hard currency to pay for the construction equipment required. Hurricane Mitch in 1998 also destroyed thousands of dwellings.

At the last census in 1995, there were only about 751,637 dwellings to serve over 4.3 million people. Most dwellings are detached houses. Many rural residents live in ranchos or cuartes (private units with some common facilities). Estimates in 2005 indicated that there was a housing deficit of over 500,000 dwellings and that about 3.75 million people were living in substandard housing.

EDUCATION

Primary and secondary education is free and compulsory for 6 years between the ages of 6 and 12. Basic secondary education covers three years of study, after which students may continue in a two-year diversified secondary program or a three-year technical school program. The academic year runs from March to December.

In 2001, about 26% of children between the ages of three and six were enrolled in some type of preschool program. Primary school enrollment in 2003 was estimated at about 85% of age-eligible students. The same year, secondary school enrollment was about 39% of age-eligible students; 36% for boys and 42% for girls. It is estimated that about 74.6% of all students complete their primary education. The student-to-teacher ratio for primary school was at about 35:1 in 2003; the ratio for secondary school was about 34:1. In 2003, private schools accounted for about 15.5% of primary school enrollment and 29% of secondary enrollment.

The National Autonomous University of Nicaragua offers instruction in 10 faculties: medicine, law and social sciences, dentistry, chemistry, and humanities in León; and agriculture, education, economics, physical and mathematical sciences, and humanities in Managua. The Central American University, affiliated with Georgetown University, opened in Managua in 1961, and the privately controlled Polytechnic University of Nicaragua, also in Managua, attained university status in 1977. Some others include the Central American Institute for Business Management, affiliated with the Harvard Business School; the University of Mobile, affiliated with Mobile College, Alabama; Nicaraguan Catholic University; and the National Engineering University. There were a total of 14 universities in Nicaragua in 1998. In 2003, about 18% of the tertiary age population were enrolled in some type of higher education program. The adult literacy rate for 2004 was estimated at about 76.7%.

As of 2003, public expenditure on education was estimated at 3.1% of GDP, or 15% of total government expenditures.

LIBRARIES AND MUSEUMS

The National Library in Managua is the largest library in the country, holding a collection of 120,000 volumes. The National Autonomous University of Nicaragua in León holds the largest university collection with 36,700 volumes. Nicaragua has about 13 branch public libraries holding a total of 187,000 volumes. The largest branch is in León, and holds 32,000 volumes. There is a Central American Institute in Managua with 39,000 volumes focusing on the social and economic conditions of the region.

The National Museum, founded in 1896 and featuring archaeology and history, is in Managua at the National Palace, which houses the National Library and the National Archives as well. There is an archeological museum in Granada and three provincial historical and archeological museums.

MEDIA

Postal, telegraph, and telephone facilities are government-owned. Since 1990, TELCOR, the national communications company, has invested over $100 million on upgrading its facilities. Telephone service is limited to the heavily populated west coast and, except for Managua (where there is an automatic dial system), is inadequate. In 2003, there were an estimated 37 mainline telephones for every 1,000 people. The same year, there were approximately 85 mobile phones in use for every 1,000 people.

In 2004, there were 210 chartered radio stations in the country, 52 AM stations and 158 FM. The Voice of Nicaragua is the primary government station. There were 10 television stations based in Managua and 63 cable television franchises. In 2003, there were an estimated 270 radios and 123 television sets for every 1,000 people. The same year, there were 27.9 personal computers for every 1,000 people and 17 of every 1,000 people had access to the Internet. There were 17 secure Internet servers in the country in 2004.

There were two major daily newspapers in 2004 including, La Prensa, with a circulation of 37,000, and El Nuevo Diario, circulation 30,000. La Prensa, a harsh critic of Somoza rule and of the Sandinista regime, was closed in 1986 but, in accordance with the Arias peace plan, was allowed to resume publication in 1987. Press censorship ended with the departure of the Sandinista government. Confidencial is a popular weekly.

The constitution provides for freedom of speech and the press, and the government is said to be supportive of these rights in practice. The privately owned print media and the broadcast media openly discuss diverse viewpoints without government interference.

ORGANIZATIONS

Three cooperative organizations for cotton growers, shoemakers, and leather workers operate in the country. Of the four employers' associations, the most important was the Higher Council of Private Enterprise (Conejos Superior de la Empresa Privada—COSEP). The Nicaragua Chamber of Commerce is in Managua. The Augusto Cesar Sandino Foundation offers technical and methodological assistance to grassroots organizations for local development.

National youth organizations include the Union Nacional de Estudiantes de Nicaragua, Juventud Sandinista 19 de Julio, the Scout Association of Nicaragua, Girl Guides, and chapters of YMCA/YWCA. There are several sports associations active within the country. Fundacion Puntos de Encuentro is a national women's organization.

Volunteer service organizations, such as the Lions Clubs International, are also present. There are national chapters of the Red Cross, the Society of St. Vincent de Paul, UNICEF, and Habitat for Humanity.

TOURISM, TRAVEL, AND RECREATION

Although Nicaragua has beaches on two oceans, magnificent mountain and tropical scenery, and the two largest lakes in Central America, a decade of military conflict retarded the development of the tourist industry. The government, however, has made the development of its tourism industry a top priority. Foreign nationals must possess a passport valid for at least six months after entry. Tourist cards instead of visas are used for travelers from most countries. Baseball is the national sport. Basketball, cockfighting, bullfighting, golfing, and water sports are also popular.

In 2003, about 526,000 foreign visitors arrived in Nicaragua. Hotel rooms numbered 4,418 with 7,669 beds and an average stay of two nights. Tourism expenditure receipts totaled $155 million.

In 2002, the US Department of State estimated the daily cost for food, hotel, and other expenses in Managua at $176.

FAMOUS NICARAGUANS

International literary fame came to Nicaragua with the publication of Azul, a collection of lyric poetry and short stories by Rubén Darío (Félix Rubén Garcia-Sarmiento, 1867–1916). Born in Metapa (renamed Ciudad Darío in his honor), Darío created a new literary style in Spanish, exemplified by "art for art's sake" and a revelry in the senses. Miguel Larreynaga (1771–1845) was an outstanding figure during the colonial period and later an ardent independence leader, teacher, jurist, and author. Santiago Arguëllo (1872–1940) was a noted poet and educator. Three modern poets are Fray Azarías Pallais (1885–1954), Alfonso Cortés (1893–1963), and Salomón de la Selva (1893–1959). Luis Abraham Delgadillo (1887–1961), a writer, educator, and musical conductor, was also Nicaragua's leading composer.

The Somoza family, which ruled Nicaragua 1934–79, included Anastasio Somoza García (1896–1956), president during 1937–47 and again during 1950–56; his oldest son, Luis Somoza Debayle (1922–67), president during 1956–63; and a younger son, Anastasio Somoza Debayle (1925–80), president during 1967–72 and again from 1974–79 revolution. The Sandinistas, who overthrew the Somoza dynasty, take their name from the nationalist Gen. Augusto César Sandino (1895–1934). José Daniel Ortega Saavedra (b.1945) emerged as the leading figure in the junta that governed Nicaragua from 1979 to 1990.

DEPENDENCIES

Nicaragua has no territories or colonies.

BIBLIOGRAPHY

Agriculture in Nicaragua: Promoting Competitiveness and Stimulating Broad-Based Growth. Washington, D.C.: World Bank, 2003.

Brentlinger, John. The Best of What We Are: Reflections on the Nicaraguan Revolution. Amherst, Mass.: University of Massachusetts Press, 1995.

Calvert, Peter. A Political and Economic Dictionary of Latin America. Philadelphia: Routledge/Taylor and Francis, 2004.

Cruz, Consuelo. Political Culture and Institutional Development in Costa Rica and Nicaragua: World-making in the Tropics. New York: Cambridge University Press, 2005.

Gomez, Mayra. Human Rights in Cuba, El Salvador, and Nicaragua: A Sociological Perspective on Human Rights Abuse. New York: Routledge, 2003.

Health in the Americas, 2002 edition. Washington, D.C.: Pan American Health Organization, Pan American Sanitary Bureau, Regional Office of the World Health Organization, 2002.

Kagan, Robert. A Twilight Struggle: American Power and Nicaragua, 1977-1990. New York: Free Press, 1996.

Norsworthy, Kent. Nicaragua: A Country Guide. 2nd ed. Albuquerque, N.M.: Inter-Hemispheric Education Resource Center, 1990.

Paths to Central American Prehistory. Edited by Frederick W. Lange. Niwot, Colo.: University Press of Colorado, 1996.

Pezzullo, Lawrence. At the Fall of Somoza. Pittsburgh: University of Pittsburgh Press, 1993.

Solaun, Mauricio. U.S. Intervention and Regime Change in Nicaragua. Lincoln: University of Nebraska Press, 2005.

Vanden, Harry E. Democracy and Socialism in Sandinista Nicaragua. Boulder, Colo.: L. Rienner, 1993.