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Nicaragua Elections:  Too Close to Call

While the opposition is divided, Daniel Ortega leads a well-oiled political machine deeply intermeshed with government agencies staffed by FSLN cadres. Ortega heads the polls, but the outcome could be decided by last-minute support for his main rivals.


In the November 5 elections, Nicaraguans will select among four experienced presidential candidates, each representing a major historical tradition in Latin American politics. Nicaraguans have never before faced so many meaningful options – a luxury for voters that makes predictions a very risky business. 

There is a real possibility that Daniel Ortega, caudillo of the Sandinista National Liberation Front (FSLN), will return to the presidency (which he held following the 1979 revolution until losing the 1990 elections). But Ortega’s re-emergence has little to do with the wave of grassroots populism passing through the South American Andes.  Rather, Ortega leads a well-oiled political machine deeply intermeshed with government agencies staffed by FSLN cadres. His opposition is divided, and he has successfully maneuvered to reduce to 35 percent (along with a 5 percent margin over the second-place candidate) the minimum required to win a first-round victory and avoid a run-off – polls consistently show that some 60 percent of Nicaraguans would under no circumstances vote for him.


Ortega’s opportunity also stems from the split within the traditional Liberal Constitutional Party (PLC), the main opposition to the Sandinistas. Former president and convicted embezzler Arnoldo Aleman retains tight reigns over the party apparatus, blocking the ambitions of financier and former senior government minister Eduardo Montealegre. The Ivy League-educated Montealegre, with the backing of most of the private sector, split from the PLC and set up his own National Liberal Alliance (ALN). The 51 year-old Montealegre represents the modernizing, educated Nicaragua sick and tired of the gross corruption, cronyism and systematic extortion practiced by the Aleman clique. 

The Bush administration tried mightily to unify the Aleman and Montealegre factions behind a relatively clean candidate, but could not overcome the personal ambitions, as well as the real substantive differences, between the two camps. The United States opposed the Aleman faction for two strong reasons. Having stolen and misallocated a good portion of the $2 billion in US assistance provided Nicaragua since 1990, the Aleman crowd bears significant responsibility for Nicaragua’s mediocre economic performance; the bedrock US interest in Nicaragua – consolidation of democracy - is threatened by persistent high unemployment and growing popular cynicism toward democratic institutions. Second, Aleman’s illegal activities left him open to extortion by the FSLN, and Ortega has cleverly used this leverage to forge an FSLN-PLC working alliance that has enabled Ortega to stack party cadres throughout key government agencies, including the judiciary and the national electoral system.

According to current polls, the traditional PLC candidate, Jose Rizo, commands about 15 percent of the electorate, with his strength coming from traditional Liberal families, the less educated rural poor and some middle-class urbanites resentful of the financial elites gathered around Montealegre. Montealegre, meanwhile, registers around 25 percent, trailing Ortega by about 5 points. Montealegre’s strength is also his weakness: he’s the capable, efficient administrator who will move Nicaragua forward – but whose undeniable aristocratic bearing is ill-suited to political campaigning. In the closing weeks of the campaign, his well-financed media barrage will stir bitter memories of the Sandinista 1980s – civil war, consumer shortages, hyper-inflation – and hope to attract the voter looking for the candidate most likely to defeat Ortega.


Montealegre is batting for the centrist, undecided voters against FSLN dissident Edmundo Jarquin, formerly an economist with the Inter-American Development Bank.  Most of the intelligentsia and leftist idealists abandoned Ortega to form the Sandinista Renovation Movement (MRS), and under Jarquin articulate a social democratic vision emphasizing clean governance and growth with equity. Jarquin stepped up from his vice presidential slot upon the sudden death of the popular Herty Lewites, and gained some quick name recognition with a catchy series of TV spots: “The ugly guy who wants a pretty Nicaragua.” (El feo que quiere una Nicaragua linda.) With his deep baritone voice, Jarquin projects a statesman-like authority and excelled in the CNN en Español debate. But he remains relatively unknown and is short of campaign funds, relying largely on his $1 million share of the public monies available to candidates. The private sector and upper-middle class distrust the former FSLN comandantes that surround Jarquin, and also fear that he will leech undecided voters away from Montealegre, hampering their favorite’s chances of winning in the first round. However, Jarquin also bites into Ortega’s base, seriously threatening the comandante’s first-round chances.  Polls fix Jarquin at 15-18 percent of the vote; any eleventh-hour surge would arise from his high popular ratings for honesty and empathy, and his perceived potential to bring change and create jobs within a democratic framework.


For his part, Ortega is running a surreal campaign stressing peace, love, religion and national reconciliation – his vice presidential running mate is a former Contra leader and the pre-confiscation owner of his own residence. To broaden his appeal, Ortega has gone so far as to embrace the campaign by the Catholic Church and Evangelicals to outlaw therapeutic abortions and mandate 10-year sentences for the doctor, mother and her complicit family. This effort at image make-over contrasts with the more belligerent Ortega that re-surfaces in some speeches before party loyalists where he ritualistically denounces “savage capitalism” and accuses his three opponents of being mere “lawyers” for foreign corporations, and collides with his very public affirmations of fealty toward Fidel Castro and Venezuelan president Hugo Chavez. He also refuses to participate in organized debates with the other candidates. While most Nicaraguans are not buying into the new image, at around 30 percent in the polls – possibly as high as 33 percent once absenteeism is factored in – Ortega only needs a few more points to reverse the humiliation of 1990 and restore “the revolution” to power.

Ortega can count on a disciplined political party and affiliated unions, seemingly infinite financial resources, support from many of those who fought with the FSLN during the civil war, and those who received some direct benefits during the 1980s or from the many FSLN-controlled municipalities today. Some younger voters, painfully aware of the mediocre performance of the capitalist economy over the last 16 years and the ever-more glaring inequalities, are attracted to Ortega’s promises of “zero unemployment.”  Although strongest in the cities, the FSLN has worked assiduously to build support in small towns and rural areas as well. And there is the unstated racial appeal: Ortega’s common man face contrasts sharply with the European whiteness of the Nicaraguan elites and of Montealegre.


Then there is the Chavez factor. Following the defeats of the candidates in Peru and Mexico that he so vocally supported, Chavez has toned down his backing for Ortega. But the Sandinistas are boasting that, if they are elected, Chavez will cover Nicaragua’s burdensome energy imports with subsidized oil. To date, Chavez has delivered only one tiny tanker with 84,000 gallons of diesel fuel although a second shipment is supposed to arrive just before the elections. To distribute the Venezuelan fuel, the FSLN have set up a company, Alba Petroleos de Nicaragua (Albanic), named in honor of Chavez’s Bolivarian Alternative for the Americas (ALBA).  FSLN economic guru and wealthy investor Bayardo Arce has spoken of annual oil shipments from Venezuela of $700 million at current market prices, 40 percent to be paid with low-interest bonds and the remainder in bartered exports – a big bite of Nicaragua’s current export capacity. Chavez has also been shipping fertilizer to FSLN-controlled rural associations.

If elected, the FSLN pledges that it will not engage in the outright property expropriations of the 1980s - a credible promise since many Sandinistas are now capitalists and landowners. But the Sandinistas – like the Somozas and Aleman - are already adept at manipulating state power to create an unequal playing field by subsidizing their colleagues and squeezing their competitors.

The other three campaigns have asserted their strong support for the US-Central America Free Trade Agreement (CAFTA), and its derivatives: application of international quality standards, more open competition and transparent government, an attractive business climate for private investment, and the rule of law.  Both the Montealegre and Jarquin campaigns emphasize CAFTA’s dynamic growth potential, for only if national growth rates rise substantially can Nicaragua make visible progress in poverty alleviation.  Already the “CAFTA moment” – the tariff reductions, investment guarantees, image enhancement – is yielding positive results: Nicaraguan exports to the U.S. jumped nearly 40 percent in the second quarter of 2006, with good performance in an expanding range of traditional (coffee, meat) and non-traditional agricultural exports (fresh fruits and  vegetables, peanuts); while new investments are flowing into textiles and apparel, tourism, and international real estate developments, with many more projects on hold pending the election results.  


Ultimately, the outcome on Sunday, November 5 will be driven by these factors:

  • The useful vote: at the last minute, will voters swing behind the candidate most likely to stop Ortega, to the probable advantage of Montealegre?
  • The hidden vote: are there many Sandinistas who publicly proclaim their allegiance to Ortega but are privately planning to switch to Jarquin?
  • The disappearing vote: the higher the abstention rate, the more likely that the hard-core Sandinista vote could reach the magic 35 percent.

While the electoral system is considered immune to massive fraud, there is concern that if the election is very close the Sandinistas will use their partisan influence at the voting tables and electoral court to challenge just enough votes to make the difference. Ortega’s public derisions of international election observers is feeding fear of fraudulent intentions.  Further, the Organization of American States’ observer mission may be neutered by Venezuelan influence in the OAS’s governing body, the Permanent Council.  That could place the observer mission led by President Jimmy Carter – who since 1979 has repeatedly played a key role in Nicaraguan politics – once again in a fateful role.

Richard Feinberg is professor at the Graduate School of International Relations and Pacific Studies, University of California, San Diego.  Previously, he served as President Clinton’s Latin American expert on the National Security Council.  He wrote this report for Latin Business Chronicle. His previous report on Nicaragua appeared July 31, 2006.

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