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PRESIDENT Donald Trump signed into law the “Nica Act” (Nicaraguan Investment Conditionality Act) on December 20 2018, over two years after the draft legislation was first approved by the US House of Representatives in September 2016.
The Act seeks to use the US’s “voice, vote and influence” within international financial institutions, including the World Bank, the International Monetary Fund and the Inter-American Development Bank, to stop them providing “any loan or financial or technical assistance” to Nicaragua’s government.
This is of course extremely significant as the US is a strong and, at times, dominant voice in these institutions, and a voice that many international actors do not want to be at odds with.
The Act also gives the US president the authority to impose targeted sanctions on Nicaraguan government officials, former officials, or people purportedly “acting on behalf of” the government in Managua.
The secretary of state is instructed by the Act to submit a report to congressional committees within six months as to whether the Nicaraguan government is complying with a range of US demands, including a demand for early elections.
The US demand for early elections is significant as Nicaragua’s elected president is less than half way through his constitutional term of office, having won the last presidential election in 2016 with 72 per cent of the vote on a turnout of around 65 per cent.
By incorporating the International Emergency Economic Powers Act, the act also paves the way for the president to go even further in infringing Nicaragua’s sovereignty.
Powers granted to the president under this Act enable Trump to block and prohibit financial and other asset transactions and deny or revoke visas, and such measures have been the precursor for further interventions in other countries.
The legislation is a clear violation of international law and Article 1 of the charters of the United Nations and the Organisation of American States Charters, both of which condemn such actions.
The campaign behind the Nica Act within the US was largely led by recently retired neoconservative Florida Representative Ileana Ros-Lehtinen, with help from Florida Representative Mario Diaz Balart and Senators Marco Rubio and Ted Cruz, all Republicans. Their political history includes aggressive support for the blockade of Cuba and sanctions against Venezuela, and even calling for a coup in the latter country.
The Nica Act’s supporters hope it will cut off future financial loans to Nicaragua through the World Bank, and other lenders.
Loans to Nicaragua are running at $250 million (£189m) annually and are being invested in education, social programmes, electrification, roads and other infrastructure initiatives.
One such project is a $60m (£45m) World Bank-funded project to strengthen the public health care system in Nicaragua, part of a drive to improve health and education services.
Additionally, there is a danger that donor nations may use negative loan decisions to guide their own bilateral aid and loans, creating a multiplier effect and cutting some European aid as well.
The Nica Act could therefore be a heavy additional blow to what had been achieved under the FSLN (Sandinista) government’s poverty reduction programme, under which the poverty rate was nearly halved, from 45.8 per cent of the population in 2005 to 24.9 per cent in 2016.
These sanctions will hit ordinary people hard, whether or not they support Nicaragua’s current government, and it is is the poor and most vulnerable in society who will suffer the most serious consequences as a result.
Additionally, history in the region, and indeed elsewhere, suggests such US sanctions are likely to further exacerbate the country’s divisions and difficulties rather than help the country move forward.
These factors also explain why within Nicaragua, the Nica Act has been opposed by a wide-range of voices, including both some business organisations (including CONAMIPYME, the organisation of small and medium businesses) and trade unions, who are both for and against the current government.
The reality is that the Nica Act has little to do with US concern for human rights, democracy and the rule of law.
The Act is instead a tool to help effect the Trump administration’s “regime change” agenda, which is not confined to Nicaragua but includes Cuba and Venezuela, with Brazil having been successfully delivered back into pro-US, extreme right-wing hands following the 2016 coup and jailing of Lula, the frontrunner in the presidential elections before that grave injustice.
Statements made by White House national security adviser John Bolton and recently by Secretary of State Mike Pompeo make this abundantly clear. On November 1 2018, Bolton denounced Nicaragua, along with Cuba and Venezuela, as a “troika of tyranny” and stating that he “looks forward to watching their governments fall.”
Furthermore, it is against international law for the Trump administration to decide who should be the government of any other country, and both historical and current experience in Central and Southern America shows us that social progress and people’s rights are not things that come near the top of US-installed regimes’ priorities.
There are a wide range of views on recent developments in Nicaragua within the left internationally, but whatever one’s views, sanctions from Trump that will damage the living standards of ordinary people are not the answer.
You can follow Ken Livingstone at www.twitter.com/Ken4London and www.facebook.com/KenLivingstoneOfficial For more information on campaigning against the sanctions visit the NSCAG website at http://www.nscag.org/
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