Caribbean & Central America - May 2007 (ISSN 1741-4458)

During his election campaign President Daniel Ortega promised many things to many different sectors of Nicaraguan society. Four months into his mandate it is becoming increasingly clear that the declarations he made to business leaders about following the recommendations of the IMF are of a much lower priority than his promises to the Sandinista's traditional support base among the poor.

A delegation from the IMF arrived in Managua in late April for 10 days to discuss the terms of a new agreement; the last deal, which was negotiated under former president Enrique Bolaños, expired in December 2006. The government is budgeting on receiving US$115m of IMF money in 2007, but the talks were inconclusive and the IMF team returned to Washington on 11 May. According to local media reports further negotiations will be held in June. 

A statement released by the IMF on 12 May described the talks as "very productive". However, Ortega's attitude seems to have hardened towards the organisation, following the lead of his Venezuelan ally, President Hugo Chávez , who has been fulminating against Washington-based multilateral institutions and developing his idea of Latin America's own fund, the Banco del Sur. Speaking on 12 May at the government palace, Ortega publicly warned the IMF that he would continue with his plan to increase public sector salaries despite their recommendations to not increase public spending.

Wage rises
His strident rhetoric was aimed at pacifying both Sandinista and non-Sandinista trade unions which have been determinedly demanding higher wages; non-Sandinista trade unions, in the Congreso Permanente de los Trabajadores, are pushing for a 25% increase in the minimum wage while Sandinista unions want it to be doubled. The current minimum wage stands at US$77 a month. The canasta básica (the index of staples that a family needs to survive each month), which contains 53 products, currently costs US$169. 

Although the government had initially offered a minimum wage increase of 10.4%, Ortega said in his speech on 1 May, the International Day of the Worker, that he wanted to liberate the country from "this bourgeois empire of savage capitalism" and that he may increase the minimum wage by as much as 20%. He said that this will be financed by adjustments to the tax system which would mean that "those who earn more, pay more". 

Ortega launched his government's flagship "zero hunger" campaign on 5 May in the village of Raití­, in the northern department of Jinotega, on the banks of the River Coco near Honduras. The programme aims to lift 75,000 families out of poverty by 2012 through an investment of US$150m. Families will be granted a US$2,000 bond, including a cow and pig, poultry, seeds, fruit plants, and other agricultural supplies.

Perhaps these policies will shore up the support that Ortega seems to have been losing since coming to office. Although he won the election with 37% of the vote in November, a poll with a 2.5% margin of error carried out by M&R in April showed that only 27% of Nicaraguans thought his leadership to be good or very good. 51.5% of respondents said Ortega was an authoritarian leader who was prepared to disobey democratic rules. His decision to appoint his wife, Rosario Murillo, as the government spokesperson was unpopular, and those questioned also disliked the fact that Ortega runs the government from the headquarters of his party, the Frente Sandinista de Liberación Nacional. 

• Name change
  The leader of the Partido Liberal Constitucionalista (PLC), Arnoldo Alemán, announced that he wants the party's name to be changed to the Partido Liberal. He said he hoped the name change would unite "the liberal family and democratic forces". In last year's elections the liberals competed as two different parties, the dissident Alianza Liberal Nicaragüense led by Eduardo Montealegre and the PLC. Alemán hopes to unite the party in time for the municipal elections of 2008.