[wvns] Nicaragua Building Ties With Iran
Nicaragua Building Ties With Iran
By Joachim Bamrud
Wednesday, Aug. 15, 2007
http://www.newsmax.com/archives/articles/2007/8/14/204426.shtml?s=lh
Nicaragua's new left-wing president has begun building a strategic
alliance with Iran, calling America a "terrorist nation."
The president, Daniel Ortega, is no stranger to Americans. Back in the
1970s and 1980s he headed the Sandinista junta that ruled Nicaragua
with the support of Castro's Cuba and the Soviet Union.
Ortega and the Sandinistas were ousted from power — though they kept
control of the state police — after a plebiscite in 1990 gave
pro-democracy forces control of the nation's parliament.
But the Sandinistas have re-emerged with the election of Ortega last
November, giving him control of the strategically located Nicaragua,
the poorest country in Central America and the second poorest in the
Western Hemisphere.
Dangerous Alliance
Though Ortega had campaigned to keep Nicaragua democratic and open to
free enterprise, there are worrisome signs he is increasingly joining
ranks with Hugo Chavez's neighboring Venezuela to oppose U.S.
interests in the region.
And now he is seeking to establish ties with Iran.
Iran is set to pump nearly $500 million into Nicaragua to build a new
hydroelectric project, invest in a new port and build 10,000 new
houses, Ortega announced in early August after hosting an Iranian
government delegation that included Iran's deputy energy minister,
Hamid Chitchian.
That visit came after Ortega flew to Tehran in June and Iranian
President Mahmoud Ahmadinejad visited Nicaragua in January, shortly
after Ortega assumed office.
Ahmadinejad has made little secret of his disdain for the U.S.,
denouncing what he calls America's "devilish rule" — a throwback to
Ayatollah Khomeini calling the U.S. the "Great Satan."
"An Iranian embassy in [Nicaraguan capital] Managua is worrisome for
Nicaragua's neighbors because Iran doesn't travel alone: It comes with
terror and terrorist organizations, such as Hezbollah," warns Jaime
Daremblum, a senior fellow with the Hudson Institute and director of
its Center for Latin American Studies.
"Remember what happened in Buenos Aires during the early 1990s and one
can visualize what an Iranian mission in Managua may bring to the area."
Iran and Hezbollah have been charged as the intellectual and material
culprits behind the 1994 bombing of the AMIA Jewish community center
in Buenos Aires that killed 85 people and wounded more than 200. An
Argentine federal judge last year ordered the arrest of Iran's former
President Akbar Hashemi Rafsanjani and eight other former officials
for the attack.
The growing ties with Iran come on the heels of Ortega renewing
diplomatic ties with North Korea in May.
"If Nicaragua gets itself tied into that gang of losers, it's just bad
news for Nicaraguans," says William Ratliff, a research fellow at
Stanford University's Hoover Institution. "They have enough bad news
as it is."
U.S. officials are also concerned.
"We urge Nicaragua to choose international partners that share the
democratic aspirations of the Nicaraguan people, that abide by
international commitments, and that are responsible members of the
global community," a spokesperson for the U.S. State Department said
when asked for a comment on the growing Iran-Nicaragua ties.
Disturbingly, the increasing links with Iran and North Korea come on
top of close relations with Venezuela.
In July, Ortega hosted Venezuelan President Hugo Chavez, who
inaugurated a $2.5 billion oil refinery. That followed Chavez's visit
only four months earlier when the two leaders signed several
agreements on oil and development assistance.
In addition, Nicaragua has joined ALBA, a political-economic alliance
of leftist countries that also includes Cuba, Bolivia and Venezuela,
and Telesur, a pan-regional TV network started by Chavez.
Venezuela was active in Nicaragua even before Ortega assumed the
country's presidency in January, thanks to ALBA Petroleos de Nicaragua
(Albanic), a Sandinista company that imported oil at favorable prices
from Venezuela.
Meanwhile, Ortega has also increased his anti-U.S. rhetoric. "We
condemn the blowing up of the [New York twin] towers, but we also
condemn the terrorist action by the United States to invade Iraq," he
said during a recent press conference.
During Chavez's visit, he called President George Bush a "world
tyrant" who came to power "through fraud," according to The Associated
Press.
Playing Both Sides
"Ortega is performing a balancing act," says Jerry Haar, a professor
of management and international business and associate director of the
Knight Ridder Center for Excellence in Management in the College of
Business Administration at Florida International University.
"He cannot fully embrace nor fully reject either the U.S. on the one
side or Chavez and his autocratic allies on the other."
The new policies and rhetoric are leading to renewed worries that
Ortega plans to repeat past mistakes from his 1979-90 administration,
when he led a Cuba/Soviet-supported government that abused human
rights and created economic chaos.
Inflation jumped from 35.1 percent in 1980 to 3,004.1 percent in 1990,
while GDP went from growth of 4.6 percent in 1980 to a decline of 0.1
percent in 1990.
All in all, the economy declined in all but three of the 10 years
Ortega ruled Nicaragua.
This time around, Ortega threatened to expel Spanish electricity
company Union Fenosa — before getting a pledge for further investments
— and recently claimed that "world trade was dominated by the tyranny
of global capitalism."
Ratliff says, "I don't think he's changed that much, if one judges by
the way he chooses his friends."
Yet most experts believe Ortega won't follow the radical policies of
Chavez and nationalize private companies.
"Oil abundance allows Chavez to behave as he does," Haar points out.
"Nicaragua does not have that luxury. Moreover, I suspect that Ortega
has learned from the first go-around in power that publicly owned
enterprises do not create the revenue, efficiency, and overall
performance of those that rest in private hands.
"If he does begin nationalizing industries and companies, the
beneficiaries will be his neighbors [capturing Nicaraguan private and
foreign investment] ... and the Miami condo market, of course."
Add to the mix that Nicaragua's economy is getting a boost from demand
for its commodities, growth of the ethanol market and the DR-CAFTA
(The Dominican Republic–Central America Free Trade Agreement) — the
free trade agreement with the United States, Haar adds. Nicaragua is
the CAFTA country that has benefited most from the treaty, seeing
exports to the United States grow by 29.2 percent last year.
That in addition to an aggressive pursuit of opportunities in call
centers, tourism, and non-traditional exports (organic and fair trade
products and processed and fresh tropical fruits), which provide
reasons for optimism, Haar says.
"Tourism is expanding in the country's interior and colonial cities,
and the country is the safest in Central America; with minimal
presence of Mara Salvatrucha gangs," Haar says, referring to the
infamous gangs that are causing serious crime problems in several of
Nicaragua's neighboring countries.
Daremblum agrees. "Daniel Ortega, so far, has shown to be careful not
to scare private and foreign businesses and investors," he says.
"Although he pays lip service to Chavez and his revolution-minded
minions, he's been far from undertaking the type of rhetoric or legal
breaking measures of the Chavez model …
"In any event, he needs foreign investment, particularly American, to
improve the lot of his people and he knows where the red lines are."
Loans from the U.S. and the Inter-American Development Bank keep
Ortega's hands tied when it comes to any mischief that could scare
away the "bread providers of his country," Daremblum asserts.
So far, the United States has responded with its own balancing act.
'Quiet' Policy: The Best Policy
While U.S. officials are concerned about Nicaragua's ties with
Venezuela and Iran, they appear to be following a non-confrontational
policy aimed at keeping Nicaragua open to U.S. trade and investment.
"The U.S., post-election, has been very cooperative with Ortega and
the State Department has refrained from any offensive tirades against
the Sandinista president," Daremblum says.
And that's a sensible policy, argues Ratliff. "I think a relatively
quiet policy is best," he says. Nicaragua today is not a threat to
U.S. national security the way it was during Ortega's previous
administration, when the U.S. and the Soviets fought over Nicaragua as
part of the Cold War, he points out. However, that could change if
Iran's diplomatic presence turns out to be more than just that.
Haar says, "Should those `ties' produce tangible, documented threats
to stability in the region and to the U.S., then I would definitely be
concerned."
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