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Nicaragua Digging Out From the Mud and Mire
The Washington Diplomat / January 1999

By Larry Luxner

As anyone who's ever been to Managua can attest, much of the Nicaraguan capital still looks like a ghost town, with shattered buildings and large grassy patches where downtown shops and restaurants once stood providing stark reminders of the 1972 earthquake that killed 6,000 people.

Yet the earthquake -- as devastating as it was -- pales in comparison to Hurricane Mitch, according to Nicaragua's ambassador in Washington, Francisco Aguirre Secasa.

"I was on the last flight into Managua, on Oct. 29, before the airport was shut down by Mitch," recalled Sacasa in an interview at the Nicaraguan Embassy. "I was there during the hurricane, and left Managua on Nov. 2, on the first flight out."

Says Sacasa: "The earthquake destroyed much of Managua but it didn't even touch our productive apparatus. This hurricane was much worse. Although Managua was not that badly affected -- except for overflowing of Lake Managua -- Mitch will affect our exports for years to come."

The hurricane and tropical storm system left an estimated 4,000 Nicaraguans dead and 900,000 homeless -- which on a U.S. scale is equivalent to 50,000 dead (nearly the number of American soldiers who died in Vietnam) and 50 million homeless. The provinces of León and Chinandega suffered the worst, with over 2,000 Nicaraguans alone dying in a storm-related mudslide on the slopes of Mount Casita volcano in Posoltega. As Nicaraguan President Arnoldo Alemán remarked a few weeks ago in Washington, "entire villages of farming families were buried, with the mud erasing all traces of their existence in a single apocalyptic event."

Likewise, says the ambassador, the $1.5 billion in damages sustained by Nicaragua, on a U.S. scale, would be equivalent to a whopping $5 trillion.

"I've been trying to work very hard on explaining to people how bad the disaster was," says Sacasa, 54, who has been Nicaragua's envoy here since March 1997 and was a World Bank official in Washington before that. He has appeared on CNN, the Today show and a number of other TV programs. "As the U.S. authorities understood the magnitude of the crisis, they've become more forthcoming."

Mitch, which dumped 60 inches of rain over a four-day period, destroyed over 100 bridges and caused massive damage to the country's shrimp ponds along the Gulf of Fonseca, the source of valuable shrimp exports to the United States and elsewhere. Tobacco exports in the Estelí region also suffered in the wake of the storm, while coffee exports -- valued at $300 million a year -- will effectively be cut in half.

"The coffee sector has been hard-hit, but the greatest problem we have is not destruction of the trees, but getting workers to harvest the crop, because there are no roads," he said. "So much of the 1998 crop may go unharvested."

In response to the devastation, delegates representing donor nations pledged $6.3 billion at a Dec. 13-14 conference at the Inter-American Development Bank in Washington to help Central America recover from the effects of Mitch. In Nicaragua, this is particularly crucial, says Sacasa, since the country's 4.5 million inhabitants are burdened with a per-capita external debt of $1,400 -- the highest in the Western Hemisphere. That, he claims, is a legacy of years of economic mismanagement by the leftist Sandinistas.

"For a change, these meetings went way beyond our expectations. What came out of them was extraordinary. We got a massive outpouring of solidarity with Latin America," he said, adding that money so far given by the United States "means more food, more helicopters, more economic assistance at a time when we're trying to get out of the mud and mire Hurricane Mitch left us in.

"The United States will forgive 90% of Nicaragua's debt, and both the World Bank and the IMF will consider Nicaragua's access to the HIPC (Heavily Indebted Poor Countries) initiative," he continued. "There will be a meeting in January to review our economic performance. I expect that instead of waiting until 2000, that'll be brought forward to 1999."

Sacasa says despite the enormous setbacks, the hurricane won't set back Nicaragua's ambitious privatization plans. "Next year, Enitel [the state-owned telephone monopoly] will be sold off. We expect to get half a dozen takers."

On another front, the Nicaraguan ambassador is pushing for the CBI-NAFTA parity bill, which would give Central American and Caribbean nations the same U.S. trading preferences that Mexico now enjoys under the North American Free Trade Agreement. He says that during a bipartisan meeting between congressional leaders and the presidents of four Central American nations, "we asked for more favorable access to the U.S. market. There was a great willingness to help us in Congress."

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