	Nicaragua's Current Political Situation

Nicaragua began to establish a new democracy in the early 1990s after eight years of civil war in which the United States supported the anti-Sandinista contra movement in the country. Since the late 1990s, these institutions have become increasingly politicized. Current President and FSLN leader Daniel Ortega was a member of the junta that took power in 1979 after overthrowing dictator Anastasio Somoza and was elected president in 1984. He was reelected in 2011 and 2016. As opposition leader in the National Assembly from 1990 to 2006 and during his two subsequent terms as president, Ortega slowly consolidated Sandinista—and his own—control over the country's institutions. In summer 2016, the government removed some of the last checks on Ortega's power by removing members of the opposition from the legislature, easing Ortega's way to winning a third consecutive presidential term that November. In June 2016, the Sandinista-controlled Supreme Court issued rulings that prevent any major opposition force from running against Ortega and the FSLN. Since his long-sought return to the presidency in 2006, Ortega has implemented social welfare programs that have benefited Nicaragua's poor—reducing poverty, raising incomes, and providing subsidies and services—and thereby buoyed his popularity. As his popularity and power increased, so did Ortega's family wealth and influence. Ortega is reputed to be one of the wealthiest men in the country, and his children all own businesses, inviting comparisons to the Somoza family dictatorship the Sandinistas overthrew in 1979. Measured International Response to Ortega's Authoritarian Tendencies

The United States and some other countries have responded in critical but measured terms to Ortega becoming more authoritarian. But he also carefully balances his antagonistic stance against the United States and parts of Europe with cooperation on issues of importance to these countries and to Nicaragua, such as counternarcotics efforts, free trade, and Central American integration. Essentially, in the minds of many Nicaraguans, Ortega's authoritarian tendencies appear to be outweighed by populist measures that have improved their standard of living. Similarly, for many in the international community, the relative stability in Nicaragua seems to outweigh Ortega's perceived provocations and authoritarian proclivities. Critics both at home and abroad question the legitimacy of the electoral process. The World Bank says Nicaragua stands out for maintaining growth levels above the average for Latin America and the Caribbean. President Ortega's stated goal has been to implement socialism in Nicaragua, which he defines as a mixed economy. Nonetheless, he has maintained many elements of a market-based economy, including participation in the U.S.-Central America-Dominican Republic Free Trade Agreement (CAFTA-DR). Poverty has declined in recent years but remains high. Nevertheless, Nicaragua remains the poorest country in Central America—in terms of per capita GDP—and the second-poorest country in the Western Hemisphere, ahead of Haiti. The Ortega administration is preparing for that possibility, however. Controversy over Proposed Canal

Controversy and conflict have been growing over Ortega's decision to grant a 100-year concession for an inter-oceanic canal through Nicaragua to a private Chinese company, HK Nicaragua Canal Development Investment Company Ltd. (HKND). The government maintains the project will stimulate the economy and provide jobs. It has sometimes reduced assistance to sanction the Nicaraguan government. The United States and Nicaragua cooperate on security and counternarcotics issues. Human Rights

For decades, various U.S. administrations and Congresses have expressed concerns about respect for human rights in Nicaragua. Nicaragua's Relationship with Russia and Other Extra-Hemispheric Actors

Some Members of Congress have expressed concern about Nicaragua's relationship with Russia, especially recent military purchases.
This report discusses Nicaragua's current politics, economic development, and relations with the United States, and it provides context for Nicaragua's controversial reelection of President Daniel Ortega late last year. After its civil war ended, Nicaragua began to establish a democratic government in the early 1990s. Its institutions remained weak, however, and they have become increasingly politicized since the late 1990s. Ortega was a Sandinista (Frente Sandinista de Liberacion Nacional, FSLN) leader when the Sandinistas overthrew the dictatorship of Anastasio Somoza in 1979. Ortega was elected president in 1984. An electorate weary of war between the government and U.S.-backed contras denied him reelection in 1990. After three failed attempts, he won reelection in 2006 and again in 2011. Ortega consolidated control over national institutions, which facilitated him winning a third consecutive term in the November 6, 2016, presidential elections. The Sandinista-controlled Supreme Court issued rulings that prevented any major opposition force from running against Ortega and the FSLN and allowed Ortega's wife, Rosario Murillo, to run as his vice president despite a constitutional prohibition against relatives of a sitting president running for office. As in previous elections at all levels in recent years, opposition figures and international analysts strongly questioned the legitimacy of this election.
As a leader of the opposition in the legislature from 1990 to 2006 and as president since then, Ortega slowly consolidated Sandinista—and personal—control over Nicaraguan institutions. As Ortega has gained power, he reputedly has become one of the country's wealthiest men. His family's wealth and influence have grown as well, inviting comparisons to the Somoza family dictatorship. As president, Ortega has implemented social welfare programs that have benefited Nicaragua's poor—reducing poverty and raising incomes—and thereby buoyed his popularity.
The United States and other countries have responded in critical but measured terms to Ortega becoming more authoritarian. For many in the international community, Ortega's cooperation on issues of importance to them, such as counternarcotics efforts and free trade, and the relative stability in Nicaragua seem to outweigh Ortega's perceived provocations and authoritarian proclivities. Similarly, in the minds of many Nicaraguans, Ortega's authoritarian tendencies appear to be outweighed by populist measures that have improved their standard of living.
Although President Ortega's stated goal has been to implement socialism in Nicaragua, which he defines as a mixed economy, he has maintained many elements of a market-based economy. Nicaragua has maintained growth levels above the average for Latin America and the Caribbean in recent years. Over the past decade, poverty has declined significantly. Nevertheless, Nicaragua remains the poorest country in Central America and the second-poorest country in the Western Hemisphere, ahead of Haiti. The Ortega administration is taking steps to prepare for a probable sharp contraction in funds from Venezuela, a major source of government revenues in recent years. Controversy and conflict have been growing over Ortega's decision to grant a 100-year concession for an inter-oceanic canal through Nicaragua to a Chinese company. The government maintains the project will stimulate the economy and provide jobs. Critics argue it will displace rural communities and harm the environment.
The United States and Nicaragua cooperate on issues such as free trade and counternarcotics. U.S. aid has sometimes been reduced over concern for the narrowing democratic space in Nicaragua. Currently, Nicaragua is part of the U.S. Strategy for Engagement in Central America. Tensions rose recently when Nicaragua expelled three U.S. officials. Other U.S. concerns include violations of human rights, including restriction on citizens' rights to vote; government harassment of civil society groups; arbitrary arrests and killings by security forces; and corruption. The Administration and some Members of Congress have expressed concern about Nicaragua's relationship with Russia, especially recent military purchases.