Stories
Economic Turbulance In A Volcanic Country
Lisa Evans (Volunteer, Oxfam, Toronto)
It was Nicaragua's rich political history that drove me to travel to this volcanic country twice during the year 2003. My first visit in February centered around my research on coffee production and the fair trade system. My second visit in May and June had a more personal motivation. Despite my motivations, I consistently walked away from Nicaragua having learned much more about the country, the people, humanity, and myself than originally intended. I was fascinated by this country torn apart by war, natural disasters, and economic stresses.
Nicaragua is the only country in Central America to have experienced a successful revolution in 1979 when Anastasio Somoza was overthrown by the left-wing guerillas, after 30 years of brutal dictatorship. Accused by the United States of being communists aided by Cubans and Soviets, the Sandinistas, led by Daniel Ortega, faced a rough and dirty 11-year journey. Let us not forget that the Sandinistas were successful because the majority of the population, including some sectors of the business class, supported their beliefs and their vision for the country. The Sandinistas' image as a "people's party" became shattered once they were forced to make some difficult economic decisions that alienated them from the population that supported the goals and ideology of the revolution. During the war, which was financially and militarily supported by the United States under Ronald Reagan, the Sandinistas were forced to turn the majority of their finances to the war effort. It became impossible for them to follow through on their promises of land and income redistribution while the contras, financed and trained by the United States, reeked havoc on the country, terrorized the population, destroyed businesses and homes, causing thousands to flee to neighbouring Costa Rica.
While the story of the revolution remains very much alive in the hearts and minds of Nicaraguans, the country now faces a devastating economic fate similar to its Central and South American neighbours. The local currency, the Cordoba, is continually devaluing with every passing day. In a country that relies on export production, the coffee crisis and devalued primary commodities has left thousands of workers unemployed. Natural disasters have destroyed homes, caused deaths, and have led to further unemployment. There are now eight free trade zones (FTZs) throughout the country. The majority of the factories are Taiwanese or American owned. While these factories employ thousands of workers, they pay depressing wages that keep workers in a continuing cycle of poverty. It is no surprise that these FTZs are often located in the poorest areas of town. The workers are not oblivious to their repression - they simply have no other options.
During my second visit to the country, I stayed in Leon, a small town that is the home of several universities. The city, while bursting with educated minds, does not have much to offer in terms of sustainable employment for its graduating students. During my time there, I met several individuals who worked for a factory located in one of the free trade zones a short distance outside of Leon. They often talked of their lack of employment options and worried about their future. One night, a young man said to me: "I'm 24 years old and I work for $20 a week. At this salary how am I going to be able to live my dream? How can I buy a house? How can I raise a family? How can I live independently?" Many young men and women are asking these questions. Many men have left for the United States or Canada in search of work, shattering the traditional structure of the family, leaving women to head the household and live off remittances from their husbands or partners living abroad. I was not surprised when I was told that more money enters the country through remittances than the country earns in exports.
Nicaraguans are faced with tough decisions: leave the family and go to the United States to earn a living, or stay in Nicaragua and live in poverty. It is ironic that the United States, the country that is responsible for much of the repression and economic hardships of Nicaragua, is the country that many of its citizens are choosing to migrate to in pursuit of a better life.
Editor's note:
30,000-50,000 Nicaraguans were killed during US-led Contra war. Despite UN Security Council and World Court condemnations, the US has never compensated Nicaragua for economic losses and human rights atrocities. In 2000, over 75% of Nicaraguans are officially poor, 40% extremely so. Between 60% and 80% are unemployed or underemployed. The country has Latin America's highest rate of teenage pregnancies and 750,000 children have no access to education. The IMF-dictated structural adjustment means that 35% of exports covers the interest on the $5.5 billion debt.