Friends,

On the heels of the newly negotiated and what some might feel are mistakenly accepted, trade pact with Iran, I did wish to reassure you all that we are moving and shaking here and see no decline in the buying market. At least not up on our hill.

I’ve been conspicuously silent but certainly not immobile as we’ve experienced The First 100 Days of Nicaragua’s new government. They have not been definitive. Rather than clear policy initiatives, or other indication of actual intentions, for now anyway the players have effected more of a holding pattern. Meanwhile, there is a marked inclination toward secrecy in the executive and the legislative thus far have contrived to forestall any serious reforms. Both circumstances entirely predictable; the executive is a minority government with an entirely understandable inferiority complex, and the legislative branch is consumed by protecting their status.

Cynics have commented on Ex-President and convicted criminal Arnoldo Alemán’s receipt of the extraordinary boon of conditional liberty. Despite a 20-year prison sentence for money laundering, he now is permitted to travel the country, without restriction. It has even been suggested that this is the Sandinista judges’ reward to him for throwing the last election to Ortega. Loose talk, no doubt. 

The new president has shown a propensity to straddle, one foot in the international investment camp and the other in the cloud-cuckoo-land of ALBA. The latter, an energetic whim of Venezuela’s Hugo Chavez, is intended as an economic structure to rival US trade liberalization agreements in the region, notably including DR-CAFTA. 

It is well to remember the fate of those that too long try to keep a foot on the dock and on the boat. The likely, if apparently not immediately imminent death of Fidel and, very likely his brother, Raul, the effective if not literal bankruptcy of Chavez, possible civil war in Ecuador and a threatened one in Bolivia, will bring an inevitable sorting out. 

Discussion of DR-CAFTA can cause spittle to form at the corners of the new Nicaraguan president’s mouth. The very idea of it offends him to the core; a trade liberalization scheme involving the US, what’s to love? His dilemma is that DR-CAFTA is responsible for a surge in growth of Nicaraguan exports and is a key factor in attracting industrial investment to the country. 

Meanwhile in Costa Rica -- where a vocal minority are aggressively resisting ratification of DR-CAFTA -- industries lay off hundreds workers and are even packing up to move, some few to Nicaragua. Given the level of antipathy between Nicaragua’s new-old president and, Costa Rica’s likewise re-elected Oscar Arias, there may be some schadenfruede in certain Managua quarters, even if the source is vile DR-CAFTA.

Ortega increasingly is isolated in the region; he has no allies here, not even the center-left Torrijos in Panamá. He sends his vice-president to international meetings and has distanced himself from regional integration. He disparages Plan Puebla Panama, an originally Mexican effort at socio-economic development throughout the six impoverished southern Mexican States and Central America. His nominal objection is the latterly involvement of Colombia but at bottom it is because all this is seen as competition to the intended hegemony of Chavez. 

The president is said to be malleable, often reflective of whomever he has just spent time with. It is certainly true that he startled everyone, apparently his own handlers included, when he got off a plane returning from Caracas and went directly to give a speech in Carazo. Fire and brimstone it was, threatening everyone if they didn’t get out of the way of the peoples’ will. The next day? Not so much.

It is said that there are three groups vying for influence over him; they are the group around his redoubtable wife, Rosario; those around Bayardo Arce, the head of the party’s business interests; and, the group around Lenin Cerna, often caricatured holding a gun and wearing earphones, reminders of his days as head of internal security. It has been observed that this division is no bad thing, in that no one coterie commands enough power to do harm. 

It is a matter of public record that there have been ruptures among the players. The Frente is famously disciplined and these ruptures have been papered over in each case but the gist seems to be a certain level of resentment at the degree to which the party has come to be focused on one man, one wife, and one family. The presidential offices are currently in Ortega’s house, along with the party offices. Even Managua’s Sandinista mayor has expressed concern that there is too little differentiation between party and government.

It may be instructive to consider that all of the same problems facing the country the day before the inauguration still obtain. There is no pleasure in considering how unlikely the current government is to be able to adequately address those problems. Already they are fighting with teachers, the transport cooperatives, various municipal employees and the medical profession. 

It is true that one of the two main opposition parties is remarkably docile, feeding those persistent rumors regarding the ex-president’s complicity in Ortega’s election. Still, much of the press is relentless in its criticism as are the remaining two opposition parties. There are multiple checks on the new government and the pressures on them to maintain stability are pretty compelling. And there is a flipside to Chavez’s friendship. At least one.

Here in the region, despite all the posturing and the rhetoric, Chavez’s popularity is down somewhere with President Bush’s numbers. Notwithstanding his not inconsiderable puddle of oil Mr. Chavez is discovering that inflation and price controls can undermine even a strong economy. There now are regular shortages in the state stores and private vendors’ prices are rising. Chavez’s response is to make threats to nationalize the food industry; this does not bode well for Venezuela’s food supply. 

Chavez has sent troops, er, ‘advisers’, to back up Morales in Bolivia and this is being watched very carefully by the other Latin-American governments. Already the moderates like Bachelet and Lula are pulling back and the growing closeness between Mexico and Colombia reflects a realpolitik reaction to Chavez’s increasingly destabilizing force in the region.

Ortega is the junior partner in the Castro-Chavez-Correa-Morales-Ortega project. He is the only one elected with a minority of public support, little more than a third of the votes cast. He cannot produce the kind of dramatic upheaval that Morales and Correa are attempting, in Bolivia and Ecuador, respectively. He only avoids the kind of impasse he helped engineer to block the last government by the remarkable cooperation of Arnoldo Alemán.

No doubt he would dearly love for Chavez’s new international development bank to allow him to thumb his nose at the IMF but if that ever happens it is not happening now. Ortega finds himself well and truly woven into the international donor community, with his room to maneuver reduced to a bare minimum. To defy any donor group risks emulating Samson in the temple, bringing it all crashing down. 

No one is more keenly aware than the new president, of how much time and how much scheming and double-dealing were necessary to produce this second chance. Every day he has one less day remaining in his window of opportunity to build a more positive legacy for himself and his party. Every day he needs hundreds more jobs for people starting out to find one. On his good days, he also knows that the quickest way to get jobs for those people is through economic development, investment and tourism.

Anything can happen but that first, toxic, post-election flush has passed and, for now at least, the result seems to be a grumpy and occasionally ranting acceptance of the status quo. 

Best to all,

Chris R.A. Berry