If sanctions failed to solve Nicaragua’s crisis, will more sanctions succeed?
If sanctions failed to solve Nicaragua’s crisis, will more sanctions succeed?
As Ortega Tightens His Grip, Nicaragua Braces for Volatile Elections
As Ortega Tightens His Grip, Nicaragua Braces for Volatile Elections

If sanctions failed to solve Nicaragua’s crisis, will more sanctions succeed?

Nicaragua's President Daniel Ortega and his wife, Vice President Rosario Murillo, have arrested more than 30 high-level opponents in recent weeks. In this commentary for Global Americans, Crisis Group's Central America Analyst Tiziano Breda explains what's at stake.

A few months ago in Managua, a leading figure of the opposition met me at an exclusive club frequented by critics of the government for meetings and press conferences, often under the watchful eye of the police. Before excusing himself to join his daughter’s graduation, he told me that if President Daniel Ortega were to win elections later this year, business leaders should forget past differences and “get together with him again, there’s no other way.” The man I met is now in jail, completely incommunicado, and reportedly without access to the medical care he requires. He has been accused of “betraying the homeland.” Ortega’s government never ceased harassing its critics since the mass protests of 2018. But not even in the worst nightmares of the opposition did it seem possible that the government would move on to the sort of witch hunts more typical of a military dictatorship.

Daniel Ortega, the 75-year-old president of Nicaragua and a former guerrilla fighter, initiated his latest crackdown in May of this year. After reasserting control over Nicaragua’s electoral authorities and pushing through an electoral “counter-reform,” he introduced a set of repressive laws aiming to inhibit the political participation of anyone who had joined in the 2018 civic uprising against his government. Over the course of a few weeks, he and his wife, Vice President Rosario Murillo, orchestrated the arrest of over 30 high-level opponents, including presidential hopefuls, political and business leaders, and journalists, and opened investigations against another thirty. Most are believed to be in Managua’s notorious El Chipote jail, but their relatives and lawyers have not been able to confirm their whereabouts. Meanwhile, the crackdown is far from over. Many other politicians, business leaders, and journalists are either hiding or on the run. Ortega’s goal seems to be to instill terror among opponents, and he is enjoying some success.

The World Reacts

The sudden spate of detentions pushed Nicaragua back into the international spotlight after two years of relative invisibility, mostly attributable to the absence of mass protests, the regional prominence of the Venezuelan conflict, and the global focus on COVID-19. The Biden administration, busy with a turbulent transition and a surge in northern Central Americans’ arrivals at the U.S. southern border, was caught by surprise. Mindful of the shortcomings in Trump’s use of sanctions as a means to apply political pressure—which in the case of Nicaragua, far from forcing Ortega to make concessions, led him to step up his preferred brand of anti-imperialist vitriol—the Biden White House initially launched a sanctions policy review. However, Washington had not arrived at an alternative strategy by the time Ortega began locking up his adversaries.

Foreign powers, above all the U.S. and the EU, now find themselves torn among three options: resorting again to targeted sanctions; scaling up to general punitive economic measures; or trying to get the parties to negotiate a way out of the crisis. Since the spate of arrests started, the U.S. Treasury has imposed targeted sanctions, while the U.S. Congress and European Parliament are making increasingly strident calls to revise free trade deals with Nicaragua. The United Nations and the Organization of American States (OAS) have discussed the country’s predicament and issued strong condemnations of recent events.

The shift against Ortega in the OAS has been particularly striking. A total of 26 states, including many that usually side with Nicaragua or abstain, voted in favor of the condemnatory resolution passed on June 15, leaving the Sandinista government almost alone in the organization and raising the possibility that Articles 20-21 of the Inter-American Democratic Charter could be applied, leading to the country’s expulsion or suspension from the body. Meanwhile, Mexico and Argentina—which both abstained in the vote on the resolution— are seeking to forge a “third way,” neither ostracizing Nicaragua’s government nor accepting its misdeeds. They have voiced concern over the wave of detentions, but have not signed multilateral statements and resolutions. The two countries may possibly be aiming to leave some channels open to enable a dialogue between Managua and other foreign governments, particularly the U.S., despite Ortega’s apparent resistance to any diplomatic approaches.

The Case for Outside Pressure

There is some truth to the argument that “Ortega only understands pressure,” which underpins calls for stronger punitive measures. Since the eruption of the 2018 mass protests, triggered by a controversial social security system reform, Ortega has engaged in talks with the opposition groups gathered under the umbrella of the Civic Alliance only when he felt acutely weak or exposed. This happened once in May 2018, when hundreds of thousands of people were marching every day in the streets of the country’s main cities, and again in early 2019, when one of his key allies, Venezuela’s Nicolás Maduro, seemed on the brink of being toppled.

But since the end of the second attempt at dialogue—which ended in deadlock in April 2019 over political and judicial reform—several rounds of targeted U.S. and EU sanctions, as well as strongly-worded OAS resolutions, have done nothing to break the Sandinista ranks. Contrary to expectations, outside pressure has revealed impressive levels of cohesion and loyalty to Ortega in the highest echelons of the security forces, the legislature, and the judiciary.

An increasing number of U.S. and European lawmakers reckon that the solution could be to raise the cost to Ortega of his authoritarian lurch by reconsidering Nicaragua’s participation in free trade agreements. Constraining trade would certainly have a significant impact on the country’s already ailing economy: 100,000 jobs are expected to vanish if Nicaragua is expelled from the Central America Free Trade Agreement (CAFTA), adding to the 200,000 lost even before the pandemic hit, mostly due to the wreckage left by the 2018 turmoil and the subsequent flight of national and foreign investment. This would likely prompt thousands to flee, first to neighbouring Costa Rica. But that country is already coping with almost 100,000 Nicaraguan asylum requests and its own economic difficulties, which could prompt many to change their final destination. Arrivals of Nicaraguans at the U.S. border are set to reach a two-decade high this year.

Yet, there is little certainty that this would succeed in pressing Ortega into concessions, at least before the elections. Defeat for the president is roughly equivalent to political and personal extinction, as leaving power could put him at risk of prosecution for abuses committed during the crackdown on 2018 protests. Moreover, his risk assessment may be influenced by the fact that he has already lived through a civil war against U.S.-backed armed groups, coupled with a trade embargo, during the 1980s: “They think that with sanctions they will vanquish Nicaragua; Nicaragua has endured much more difficult times,” the president recently stated.

A Middle Way

Neither force nor dialogue is likely to change Ortega’s electoral strategy, but doing nothing would invite other aspiring authoritarians in the region to follow in his footsteps. Instead, foreign governments should aim to craft a sequenced approach that serves two goals: seeking to rescue the elections through dialogue so long as that is possible, and demonstrating that similar repressive moves will come at a cost if diplomacy fails to lure Ortega into changing course.

Before the elections, foreign governments should persist in seeking to engage with Ortega, using the few diplomatic channels still open (such as those of Argentina and Mexico), and others that might be created (e.g., by the Vatican and Sandinista-friendly governments in the region, like Bolivia), to convey the message that only the results of free and fair elections will be recognized, whereas disputed or fraudulent polls would deepen the government’s international isolation. At the same time, some punitive measures (particularly U.S. and EU sanctions) could be lifted on an action-for-action basis as a reward for concrete steps by Ortega to ease repression, starting with the release of recently arrested opponents.

If these efforts prove unsuccessful, as they well might, the U.S., EU and OAS are sure to come under pressure to deploy stronger punitive measures to hold Ortega accountable for his actions—including economic sanctions or even the suspension of Nicaragua from the OAS. Even so, the U.S. and the EU should refrain from ejecting Nicaragua from free trade agreements given their huge potential impact on people’s livelihoods. Foreign governments should instead consider sanctions on firms and economic sectors close to the government, calibrating them to mitigate humanitarian impact. Invoking the Inter-American Democratic Charter and expelling Nicaragua from the OAS would also hinder the country’s access to loans, yet the overall economic impact would be somewhat lower than expelling Nicaragua from CAFTA.

If stronger sanctions are applied, foreign governments should also take steps to prepare for the humanitarian fallout that these might prompt. And they should also at all times keep diplomatic channels open and design a roadmap to lift punitive measures in the event that the Ortega government decides to back down and relax its stifling control over Nicaraguan society. Hopes for that outcome may seem slender. But confidence that tougher sanctions will do the job on their own may be even more misplaced.

As Ortega Tightens His Grip, Nicaragua Braces for Volatile Elections

It’s hard to imagine that three years ago, Nicaragua was rocked by huge anti-government protests that paralyzed the country before being ruthlessly quashed. Today, despite the COVID-19 pandemic and a lack of vaccines, the capital, Managua, is abuzz with activity. Shopping malls are teeming, while the intersections are crowded with beggars and vendors. Everyday life in this Central American country seems to have returned to normal. Visible scars of the 2018 unrest remain only in the form of graffiti, although many of the protest slogans have been daubed over with pro-government messages proclaiming, “The commander remains”—a reference to President Daniel Ortega. Anti-riot police watch over traffic roundabouts, clearly bored but ready to quell the first signs of public dissent.

With presidential and legislative elections scheduled for November, the coming months will test whether the calm is more than skin deep, as Nicaraguans face the prospect of lifetime rule by Ortega and his wife, Vice President Rosario Murillo. During a recent visit to the country, I heard a common refrain from disenchanted Nicaraguan voters: “They’re going to steal the elections.”

Ortega, who turns 76 in November, has a revolutionary past that belies his modern-day authoritarianism. As a young Marxist rebel with the Sandinista National Liberation Front, he spent seven years in prison under the dictator Anastasio Somoza’s regime before going on to help overthrow him in 1979—one of only two successful armed uprisings in Latin America after World War II. He then led the Sandinista government as it waged a civil war against the U.S.-backed contra fighters and won the country’s first post-revolution presidential election in 1984. He lost his reelection bid in 1990, but staged a successful comeback in the 2006 presidential poll and has been in power ever since.

This November, he will seek a fourth consecutive term as president in an election clouded by memories of the 2018 mobilization and crackdown, when over 300 people, chiefly protesters, were killed during around five months of unrest, many of them by police and parapolice forces. Since then, Ortega has lost allies at home and become increasingly isolated internationally. His recent moves to consolidate control over the electoral authorities and hamstring the opposition mean that, absent a change of course, the polls are likely to be seen as heavily rigged in his favor. That raises the prospect of another wave of unrest that further isolates the government and worsens the already dire economic and humanitarian situation in one of Latin America’s poorest countries.

Ortega’s government is clearly not inclined to concede any ground to the opposition. After the 2018 protests, the regime outlawed marches and strengthened a grassroots intelligence system employing local party loyalists, ex-convicts and even parking valets to gather information about Ortega’s opponents, the most vocal of whom are constantly harassed by security forces. Anti-government gatherings have been largely nonexistent over the past couple of years, while political discussions are taboo even within households.

Over the past year or so, the regime has enacted a series of laws and other measures that seek to stymie opposition parties’ participation in the polls, including by stacking the Supreme Electoral Council, the country’s top election body, with loyalist magistrates. The new government-friendly magistrates, appointed in early May, set a May 12 deadline for registration of political alliances, sparking a frenzied but ultimately unsuccessful effort by the two main opposition blocs, the National Coalition and the Citizen Alliance, to forge a united front against Ortega, with the latter registering on its own.

The council then moved to annul the legal credentials of the Democratic Restoration Party, the main political vehicle of the National Coalition. At the same time, judicial authorities recently launched investigations into money-laundering allegations against several journalists as well as Cristiana Chamorro, the most popular of the opposition’s presidential hopefuls and daughter of former President Violeta Barrios de Chamorro, who bested Ortega in the 1990 polls. This week, the attorney general’s office issued a statement effectively forbidding Chamorro to run for any public office. On Wednesday, she was placed under house arrest.

Ortega has tried before to meddle with the electoral process. Since he reassumed the presidency in 2007, several municipal and national elections have been tainted by allegations of wrongdoing, including the withdrawal of some opposition parties’ credentials and reported interference in the vote count. On those occasions, Ortega managed to get away with the alleged offenses thanks to his high level of public support—underpinned by robust economic growth—and strong working relationships with two of the country’s most important constituencies: the Catholic Church and the private sector.

Much of this public and institutional backing has since drained away. Businesses, the clergy and an increasing number of Nicaraguans have grown averse to the president since the 2018 crackdown, while resentment runs high among those who oppose the government but are unable to express their criticism with any safety. Only one-third of Nicaraguans continue to support Ortega, according to opinion polls. Three consecutive years of contracting GDP have induced a deep economic slump, aggravated last year by the COVID-19 pandemic and two back-to-back hurricanes.

Aware of the vulnerability of the economy and people’s livelihoods, the Ortega government avoided imposing any strict coronavirus lockdowns and managed pandemic-related data with great secrecy. The virus nevertheless claimed the lives of several high-ranking Sandinistas, including close Ortega allies, paring down the ruling party’s aging leadership at a time when there is no credible presidential successor.

Acclaimed even by critics for his political cunning, Ortega still has a clear edge over his rivals in this November’s election, when he will face a weak and fractious opposition that lacks public support. Although the opposition could in theory still band together under the Civic Alliance’s umbrella, it has broadly failed thus far to capitalize on public discontent and shape a convincing alternative to the government. Whereas students and civil society activists led the protests three years ago, well-known political and business figures—many of whom also face harassment by security forces, but attract less public support because of their perceived association with the traditional political establishment—have mostly displaced them as the chief anti-Ortega spokespeople. As a result, opposition movements and parties have performed poorly in recent opinion polls: None of them attracts support from more than 4 percent of Nicaraguans.

As recent crises in other Latin American countries such as Honduras and Bolivia have shown, a disputed election could plunge the country into fresh turmoil.

Even so, as recent crises in other Latin American countries such as Honduras and Bolivia have shown, a disputed election could plunge the country into fresh turmoil. Should the poll be widely perceived as rigged in favor of Ortega and the Sandinistas, it could rekindle public anger, particularly if the main opposition forces are able to muster enough unity to rally around one candidate. A disputed poll would also further isolate Ortega internationally, hindering any economic recovery and possibly adding to the exodus of Nicaraguans to neighboring Costa Rica, which has received most of the 100,000 people who have fled since 2018.

Unsurprisingly, the United States, the Organization of American States and the European Union have expressed alarm, firmly rejecting Ortega’s electoral “counter-reform” and reiterating their willingness to press for fair elections. Yet these reproaches cannot hide the fact that Nicaragua remains just one hotspot in a troubled region where diplomatic engagement, particularly from the U.S., needs a rethink. President Joe Biden has promised to reengage with Central America after Trump restricted cooperation to a narrow, migration-focused agenda, but for now, Biden is still concerned primarily with a dramatic increase in arrivals at its southern border. Nicaragua has received far less attention than the three Northern Triangle countries that are seen as the drivers of northward migration—El Salvador, Guatemala and Honduras—and which have been appointed their own U.S. special envoy, Ricardo Zuniga. When I asked one Civic Alliance representative about support from the Biden administration in March, the person sarcastically responded, “What Biden administration? They haven’t shown up yet.”

The White House will have its work cut out for it in crafting a strategy that would address Central America’s chronic challenges in governance, inequality and security, while neither legitimizing nor antagonizing political leaders with dubious records on the rule of law and corruption. Strongly worded statements, targeted sanctions and other punitive measures, which tend to be Washington’s preferred means of applying pressure, have fallen far short of their goal of correcting Central American governments’ behavior. In the case of Nicaragua, instead of causing defections among Sandinista loyalists or prompting concessions, the sanctions that the U.S. has imposed since 2018 against 26 top officials have led the government to dig in, reinforce its anti-imperialist rhetoric and bring to a halt virtually all communications with its Western partners.

At a time of a great stress across Central America, it would be in both Washington’s and Managua’s interests to explore solutions that serve regional stability

Withdrawing sanctions against the Nicaraguan government would be politically difficult for the Biden administration, particularly in light of the bipartisan support they enjoy in Congress. Still, refraining from imposing new ones and offering to lift some—at least privately—might help persuade Ortega to level the political playing field somewhat. Such concessions should be part of a broader effort to step up diplomatic engagement in order to prevent any electoral strife. Including Nicaragua in Zuniga’s portfolio could also be a useful first step to opening fresh communication channels. At a time of a great stress across Central America, it would be in both Washington’s and Managua’s interests to explore solutions that serve regional stability and keep Nicaragua from slipping toward greater isolation.

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