Caribbean & Central America - January 2014 (ISSN 1741-4458)

Delay to Nicaragua Canal: On 6 January, Nicaragua’s canal authority, set up to oversee the massive US$40bn project to construct a new inter-oceanic canal (‘Gran Canal’) through Nicaragua, announced that work on the project (approved in June 2013) would start "at the end of 2014", and not in May 2014, as initially proposed. This appeared to contradict an announcement two days previously by president of the canal authority, Manuel Coronel, who told reporters that the project would begin in 2015, once the feasibility studies had been completed, with a definitive route for the canal to be decided in the third quarter of this year. On 18 December, the project got the definitive green light from Nicaragua’s supreme court (CSJ) – which is controlled by President Daniel Ortega’s ruling Frente Sandinista de Liberación Nacional (FSLN) – after the court rejected 32 appeals against a June 2013 law granting the Hong Kong-based HKND Group the 50-year concession to build and operate the ‘Gran Canal’. The appeals were lodged by various sectors including the parliamentary opposition bench, Bancada Democrática Nicaragüense (BDN), which alleged that the law violated Nicaragua’s sovereignty and property rights legislation. Indigenous representatives from the Región Autónoma del Atlántico Sur (RAAS) also alleged property rights violations. Nicaragua’s influential private sector lobby, Cosep, also objected on similar legal grounds.

Inflation: On 6 January Nicaragua’s central bank reported that monthly inflation for December 2013 was 1.08%, bringing the accumulated rate for the year to 5.54%, less than the 6.62% registered in 2012. Meanwhile Eclac put Nicaragua’s GDP growth at 4.6% in 2013, down from 5.2% in 2012. Eclac expects GDP growth of 5.0% in 2014.

• Ortega one step closer to indefinite rule

On 10 December Nicaragua’s 92-member unicameral legislature approved a package of constitutional reforms proposed by President Daniel Ortega that among other things removes the ban on consecutive presidential re-election, further concentrates power in the hands of the executive and enhances the role of the military. The package, watered-down slightly [RC-13-12], awaits further voting in the current legislative session, which began on 10 January 2014.