Saturday 19 June 2021

Nicaragua recedes in economic freedom

The 2019 Index of Economic Freedom placed Nicaragua in the 107th freest of 180 countries evaluated worldwide, a drop of seven positions compared to the previous year’s report.

Since April 2018, government supporters began taking private property throughout Nicaragua, affecting national and foreign investment.

The report, prepared by The Heritage Foundation, measures components such as respect for private property, operation of state entities, taxes and market opening to name a few.

Nicaragua overall score decreased by 1.2 points, with lower scores for trade freedom, business freedom, and government integrity outweighing an improvement in property rights. Nicaragua is ranked 21st among 32 countries in the Americas region, and its overall score is below the regional and world averages.

- Advertisement -

The report lists Nicaragua in the “moderately free” group.

“Investor confidence was badly shaken by the deadly violence deployed by the authoritarian Ortega regime in 2018 against peaceful protestors opposed to perceived undemocratic rule.

“Land-grabs of farms by pro-government groups, although limited in scope, appear to have been aimed at undermining political opponents. The business environment has deteriorated, and state-owned enterprises have continued to receive favored treatment.

“Government revenues have fallen in parallel with continuing declines in assistance from Venezuela. Institutional weaknesses and an inefficient judicial system fail to protect property rights and combat corruption,” the report said.

- Advertisement -

The report says “private property rights in Nicaragua are not protected effectively, especially for foreign investors. Contracts are not always secure. The judicial system suffers from corruption and long delays, and the government controls the politicized Supreme Court. Public-sector corruption and bribery of public officials are major challenges.

“The Ortega family’s authoritarian rule is the greatest threat to the evenhanded rule of law.”

Reports from the Union of Agricultural Producers of Nicaragua (Upanic), invasions of private property by government supporters began in June 2018, when 22 properties were taken a month later they invaded another 27 properties and in August there were another 16 reported cases.

The invasions totaled 9,800 hectares, of which 66.5% are for agricultural use, 24% livestock and 6.5% of the forest type; and although little by little they have been returning them, up to May 2019, 29 properties were still invaded in seven departments of the country, equivalent to an area of 4,673 hectares, according to Upanic.

The report also mentions that efforts to transform the productive structure of the country have been slow, due to government regulation and that is palpable in the significant interference in the economy through the actions of state-owned companies.

- Advertisement -

“The lack of employment opportunities has caused chronic underemployment, the Government controls the prices of butane gas and electricity for homes, as well as pharmaceuticals and largely subsidizes fuel and water,” says the report.

Finally, when addressing the country’s commercial flexibility, the report explains that the combined value of exports and imports is equal to 96.7% of GDP, the average applied tariff rate is 2.0 percent.

“As of June 30, 2018, according to the WTO, Nicaragua had 54 nontariff measures in force. The judicial and regulatory systems impede foreign investment. The low level of financial intermediation undermines private-sector growth.

“About 33% of adult Nicaraguans have an account with a formal banking institution,” the report concluded.

Rankings in Central America

  • Panama – 50
  • Costa Rica – 61
  • Guatemala – 77
  • El Salvador – 84
  • Honduras – 93
  • Nicaragua -107
  • Belize – 123

Article originally appeared on Today Nicaragua and is republished here with permission.

- Advertisement -

FACT CHECK:
We strive for accuracy in its reports. But if you see something that doesn’t look right, send us an email. The Q reviews and updates its content regularly to ensure it’s accuracy.

Q24N
Q24N is an aggregator of news for Latin America. Reports from Mexico to the tip of Chile and Caribbean are sourced for our readers to find all their Latin America news in one place.

Related Articles

Ortega government accuses imprisoned opponents of receiving money from the United States to overthrow him

TODAY NICARAGUA – The Nicaraguan government assures that the imprisoned political...

Nicaragua government assures that detainees violated one of the Ten Commandments

TODAY NICARAGUA – The vice president of Nicaragua and First Lady,...

MOST READ

COVID vaccines in the workplace: Can I ask who got their shots?

(DW) Jon works for the local government in the US state of Virginia. The 40-year-old received both his COVID shots in April. Most of...

Nicaragua government assures that detainees violated one of the Ten Commandments

TODAY NICARAGUA – The vice president of Nicaragua and First Lady, Rosario Murillo, assured that those who feel persecuted are for the crimes they...

The “rebound” effect boosted growth in Costa Rica’s economic activity

QCOSTARICA - Costa Rica's economic activity registered in April 2021 a year-on-year growth of 8.8%, a figure affected by a “base” or “rebound” effect,...

Vaccination commission endorses J & J vaccine, says no to Sinovac

QCOSTARICA - The Comisión Nacional de Vacunación y Epidemiología (CNVE)  - National Vaccination and Epidemiology Commission - endorsed the use of Johnson and Johnson...

Despite investigation, construction of road works by H. Solís will continue

QCOSTARICA - Five major road works under the responsibility of the H. Solís company will continue in development despite investigations for alleged corruption involving...

Bribed with cars, sexual favors and money in exchange for road works contracts

QCOSTARICA - The OIJ uncovered a big pothole on Monday when it was announced that public officials had allied with construction companies that, apparently,...

Fifth tropical wave precipitation will be heavier in the north of the country

QCOSTARICA - For this Wednesday, the arrival of the fifth tropical wave of the season is expected, thus reinforcing the rainy activity mainly to...

Tourism’s path to recovery

QREPORTS - A new travel trends research paper released today by Tripadvisor®, the world's largest travel guidance platform, reveals that vaccine rollouts globally are...

Immigration system failure affected passengers at the San Jose airport Monday

QCOSTARICA -  In yet another system-wide failure in the immigration check-out, passengers looking to leave Costa Rica Monday morning by way of the Juan...

WANT TO STAY UP TO DATE WITH THE LATEST!

Get our daily newsletter with the latest posts directly in your mailbox. Click on the subscribe and fill out the form. It's that simple!

Article originally appeared on Today Nicaragua and is republished here with permission.

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.