NICARAGUA: Chavez tries to buy Ortega the election
Thomas Cromwell

Daniel Ortega, long-time leader of Nicaragua’s Sandinistas and the former Central American president most blamed for giving the Soviet communists a solid foothold in the region, has once more been smiled upon by the socialist gods. This time, his benefactor is not a Russian or Cuban, but Venezuela’s Hugo Chavez, who has been delivering favors to his Nicaraguan ally by the tanker and truck load, conveniently timed to help Ortega win national elections in November this year.

Chavez, after all, is not your subtle international player. He offered Sandinista-controlled municipalities gasoline discounted by 40 percent, with the remaining 60 percent of the price said to be going to create a development bank that would be controlled by the Sandinistas. Then, he offered the same municipalities truckloads of fertilizers, for them to hand out to farmers. Oh yes, then there are the free flights to Caracas for free eye operations for Managuans. (Yes, Managua is a run by the Sandinistas.)

Uncle Chavez is a wonderful friend for Ortega, who is reviled by most Nicaraguans for his dictatorial style (in a recent poll 69 percent of Nicaraguans said they would not vote for Ortega under any circumstance), and only has a chance in the elections because of an unholy alliance he established with former president Arnoldo Aleman, who would be serving a 20-year sentence in prison for massive corruption, were it not for the immunity he enjoyed as a member of parliament.

Nicaragua’s ambassador to Washington, Salvador E. Stadthagen, has nothing good to say about Ortega. He told in a recent interview that: “Ortega’s negatives are very, very high.” He noted that Ortega “was almost a dictator for about a decade” and that most Nicaraguans remember that period with displeasure and would not like to see Ortega return to power.

Through his pact with Aleman, Ortega undermined the current president Enrique Bolanos, who had beaten him the last time elections were held, in 2001, by 56.3 percent of the vote to 42.3 percent for Ortega. But the bad blood goes deeper. While president, Ortega had confiscated property from Bolanos and put him in prison twice.

Since Bolanos and Aleman belong to the same Liberal Constitutional Party, Aleman’s deal with Ortega essentially created a parliamentary majority in opposition and undermined the president.

Ambassador Stadthagen said that Ortega and Aleman are in the business of subverting national institutions for their own benefit. The Nicaraguan judiciary is known to be largely controlled by the Sandinistas, as are a number of important municipalities, including the capital Managua. And while Aleman hopes to influence the judiciary to reverse his prison sentence, Ortega hopes to escape charges that he sexually abused his stepdaughter for years.

But the presidential race is heating up in more than one way. Ortega himself faces a rival from among his own ranks in former Managua mayor Herty Lewites, the son of Jewish immigrants from Poland. As mayor, he won plaudits from left and right for his campaign against corruption, but his opposition to the Ortega-Aleman pact led to his expulsion from the Sandinistas last year.

In the polls, the current frontrunners are Ortega and Eduardo Montealegre, a Harvard-educated banker, who comes from the Liberal party of the president but is now the head of a newly established Nicaraguan Liberal Alliance (ALN), which was formed from two liberal parties and one conservative party. Recent polls have returned quite varied results, but a CID-GALLUP poll published in late May gave Ortega 26 percent, Montealegre 22 percent, Lewites 17 percent and Jose Rizo (the candidate of Aleman’s Liberal Constitutional Party) 12 percent.

To win in the first round, a candidate needs to get at least 35 percent of the vote, and be at least five percent ahead of any rival. Otherwise, there must be a second round. “If there is a second round, Montealegre will win easily,” the ambassador said.

Which might explain why, in the ambassador’s words, “Chavez is working very hard in the Nicaraguan elections.” The object of all his attention is clearly Ortega, with whom he has signed at least one agreement in Caracas.

The Chavez largesse of 10 million barrels of oil to Nicaragua almost for free is enormous by Nicaraguan standards and a very clear attempt to sway the electorate. The ambassador said that the value of the 40 percent discount amounts to $250 million, which is offered as unsecured, long-term credits to the municipalities, while the 60 percent that, according to Ortega will be set aside for an investment bank, amounts to $400 million. The ambassador pointed out that for a country with a GDP of just $4.5 billion, the deal, which would be funneled through Sandinista political organizations to Nicaraguans who agree to vote for Ortega, is huge.

To sweeten the pot further, Chavez also is donating 20,000 tons of fertilizer to five Sandinista-controlled municipalities, a nice gift they can pass on to hard-pressed Nicaraguan farmers. And then there are those free eye operations, performed by Cuban doctors in Caracas.

The ambassador noted that if Ortega were to win, he might well seek to revoke CAFTA, which was approved by the Nicaraguan parliament last year, in favor of joining Chavez’s rival Bolivarian initiative, which now counts Cuba and Bolivia as members.

“If Ortega wins it would be a terrible regression for Nicaragua and Latin America,” Ambassador Stadthagen said. “Ortega is a known quantity. He nationalized banks. He was known for gross human rights violations, including the persecution of the Miskito Indians.”

Away from the political contests, Nicaragua has been making good progress economically. Due to economic reforms being implemented, the country became eligible in 2004 for $5.46 billion in foreign debt reduction (84 percent of the total $6.5 billion) under the Highly Indebted Poor Countries (HIPC) initiative. So far, $4 billion of debt relief has been secured, with the balance pending. Foreign direct investment has been on the rise, and growth of the economy in 2004 was 5.1 percent, the highest in Central America. Last year it was 4 percent. Also last year Nicaragua was elevated six places on the Human Development Index of the UNDP. And it has qualified for a $175 Millennium Challenge Corporation grant, assistance from Washington that is only given after countries meet certain developmental criteria.

The ambassador is concerned that these gains will be reversed should the Sandinistas return to power. He worries that with the Sandinistas controlling the judiciary and the election commission, there are real dangers that the presidential elections in November might be manipulated to give Ortega a win.  

Biography of Salvador E. Stadthagen

Salvador Stadthagen presented his Letters of Credence as Ambassador of Nicaragua in the United States of America to President George W. Bush on December 4, 2003.

The priorities of his mission include lobbying for ratification of the Central American Free Trade Agreement, CAFTA; the promotion of investment in Nicaragua and the protection and promotion of the Nicaraguan community in the United States, a community which he considers a fundamental asset for the development of Nicaragua.

A career diplomat, Mr. Stadthagen attended Law School in Nicaragua from 1975 to 1979 and later obtained a Business Administration degree from American University (Washington, D.C., 1983) and a Masters in Public Administration from Harvard University (2002). 

His professional experience include appointments as Chargé d’ Affairs a.i. and Minister Counselor of the Embassy of Nicaragua in Japan (1990-1992), Ambassador to the Republic of China on Taiwan (1995-1999), Secretary of Economics Relations and Cooperation at the Ministry of Foreign Affairs (1999-2000) and Deputy Minister of Foreign Affairs, position that he held from May 2002 until his appointment as Ambassador to the United States.

Before entering the Nicaraguan Foreign Service, Ambassador Stadthagen served as Official Liaison between the Nicaraguan Resistance (UNO) and the U.S. State Department (1985-1986).  From 1987 to 1990, he was involved in several international education programs with the Washington D.C.-based firm Creative Associates International, Inc. Between 1992 and 1995 he was Executive Director of the Education for Democracy National Program, implemented in Nicaragua by the Ministry of Education and The American Federation of Teachers with funding from USAID and The National Endowment for Democracy.  

Born on April 20, 1957 in the northern Nicaraguan city of Jinotega, Ambassador Stadthagen’s first professional experiences took place in the private sector, mainly in coffee production, something that fostered a special bond with the Nicaraguan agricultural sector.

Married to Analía Vargas, he has four sons: Sebastian, Arturo, Federico and Francisco Javier.