Envío Digital
Central American University - UCA  
  Number 73 | Julio 1987



The Arias Plan and the Tortuous Trip to the Summit

Nitlápan-Envío team

In our May issue we analyzed the Arias plan and indicated some of its limitations as far as Costa Rica and Guatemala are concerned. In February President Oscar Arias of Costa Rica modified his original plan, apparently in line with liberal Democratic visions of an alternative Central American policy. Guatemala was to be the host country for a summit meeting of the Central American Presidents—at that point on the immediate horizon—at which the plan would be a major agenda point.

The summit and the peace plan itself were fraught with risky gambles for all concerned. Costa Rica saw the peace plan as a way to lay the groundwork for the reconstruction of Central American trade and the restoration of its democratic image, identifying itself with the future political alternative of Reagan's Democratic Party rivals. Guatemala was betting on the plan and the summit as a way to recover international prestige and win a leadership position in the region. For Nicaragua the plan suggested the end of US aid to the counterrevolution and thus an end to the contra aggression. Although the Reagan administration expressed verbal support for the proposal, it was confident that, thanks to the docility of Honduras and El Salvador, it would be able to change the plan to make it work against Nicaragua.

As the date for the summit meeting rolled around, the Reagan administration and its allies seem to have been uncomfortable with the odds and decided not to gamble. El Salvador thus postponed the summit, delaying discussion of the Arias plan. However, Nicaragua managed to transform the postponement into new life for the Contadora effort, which as we noted last month was the only framework in which to overcome the limitations of the Arias plan. What could have been a trap for Nicaragua became a diplomatic step forward.

The main developments in June, then, centered on the intense diplomatic struggle over the Arias plan and the presidential summit.

June's newsreel at a glance

On June 4 in Paris, as President Arias was winding up his European trip to drum up support for his peace plan, he described his initiative as "within the framework of the Contadora concept." With this comment he was only reflecting the reactions he had received from the European governments he had visited, all of which were interested in maintaining that framework.

On June 11, Nicaraguan President Daniel Ortega set out the position his country would take in the Guatemala summit. He recalled the urgent need to comply with the actions stipulated by the Contadora and Support Groups in the January 1986 Caraballeda Message and, referring to the Arias plan as "a contribution to peace in the region," said that Nicaragua viewed it as a way to get back to discussing the Contadora Treaty. He insisted that the Arias plan should not replace the "Latin American framework" of the Contadora negotiations.

On June 13, after meeting with special US ambassador for Central America Philip Habib, President José Napoleón Duarte of El Salvador asked that the summit be postponed until August and be preceded by several meetings of foreign ministers. With only 12 days to go before the summit, this was a critical development. On June 17 President Ortega stated that he considered June 25-26 the only valid dates for the meeting and that Nicaragua would not take part in the postponed summit since that would be a discussion not of the Arias plan but of what he called the "Habib-Duarte plan." The next day President Reagan made it clear to President Arias that his plan was unacceptable to the United States since its first point was the ending of US aid to the counterrevolution.

Given this crisis, President Cerezo of Guatemala asked Panama, a Contadora member, to try to mediate so that the summit would be held with the five Presidents present. At the invitation of President Del Valle of Panama, President Ortega visited that country on June 24. There he announced that Nicaragua would in fact take part in the August summit but would not accept any further postponements and that it would go to the preparatory meetings of foreign ministers only if they were called by Contadora. At the close of a bilateral meeting in Mexico at the same time, Presidents De La Madrid of Mexico and Alfonsín of Argentina announced that Contadora and the Support Group were preparing a plan to help Nicaragua economically and were also working towards a summit of the eight Latin American Presidents involved in the Contadora mediation effort.

The voice of Latin America, openly confronting Reagan’s militaristic policies, was making itself heard more forcefully in the Central American conflict. Nicaragua and Central America were once again becoming a symbol of Latin America’s political will to be, at last, a Latin America for Latin Americans.

The Arias plan: Two versions

The Arias plan came on the scene at a moment when Contadora was once again stagnating. A series of events converged to put it back at the head of the table in the Central American peace negotiations.

The story goes back to June 1986, when a political maneuver of the Contadora and Support Group countries themselves seemed to condemn the mediating effort begun in 1983 to failure. Contadora took this false step when it put a deadline—June 1986—on the signing of the treaty. The rigidity of this deadline undermined the most important aspect of the mediating effort: the very fact that it existed and was prepared to continue functioning until a solution was found. That is, the determined existence of this negotiating forum implies a significant reality: Latin America’s insistence on resolving a regional and Latin American conflict on a regional, Latin American level. Even in the absence of that solution, the forum itself was beginning to act as a restraint on direct US intervention in Central America and on the widening of the war against Nicaragua into a Central American war.

It was impossible to arrive at a signing of the Contadora Treaty in June 1986 because the moment was simply not ripe for any of the countries. Nicaragua tried to move the discussions along by presenting a proposal concerning a regional reduction of offensive weapons. With this as a starting point it might have been possible to come to an agreement with real content on the limits that each Central American state was willing to place on itself. But while the Nicaraguan proposal gave some new impetus to Contadora, it didn’t convince the other Central American governments to become any more flexible. From then on the Contadora mediation process began to go nowhere.

Through its proposal Nicaragua showed how lacking the Contadora Treaty was in concrete details concerning its most important aspect: security. But the Reagan administration made Nicaragua's reasonable attitude look like a refusal to sign the treaty. This came about when Democrats in the US Congress tentatively and timidly began to back the Contadora initiative as an alternative to the Republicans' military policy. The crisis in the negotiating process—provoked, as we saw above, by the forced deadline—was one of the factors that would make it easier for Reagan, that very same month, to get approval for the renewal of military aid to the counterrevolution and for the lifting of restrictions on the CIA's involvement in the war.

With the vote for "the hundred million," Nicaragua prepared to reinforce its military effort to hasten the already irreversible decline of the armed counterrevolution. At the same time it considered the congressional vote, in practice, a declaration of war. With the favorable verdict of the World Court strengthening the legitimacy of its cause, Nicaragua decided to apply its state of emergency legislation more strictly to prevent the formation of an internal conspiracy that would facilitate the sabotage campaign now predictable in the wake of the US$100 million.

In November, after a four-month silence from Contadora, the secretaries general of the UN and OAS offered their political and diplomatic services to revitalize the Contadora process. In January 1987 in Mexico, at the end of a trip through Central America with the OAS secretary general and the Contadora and Support Group foreign ministers, UN Secretary General Pérez de Cuéllar presented a significant bottom line: "We have not found in Central America the political will for peace." The negotiating train was still going nowhere.

In February, with the process still stagnating, President Arias took the initiative to get it moving. And he took up this initiative exactly where the Reagan administration had left off in June 1986. He indicated that the obstacle for peace in Central America was Nicaragua and that the other four Presidents, without Nicaragua, could come to an agreement that would either push forward the stalled regional negotiations or justify the definitive isolation of Nicaragua and the eventual destruction of the Sandinista government.

This was the background of the meeting of the four Central American Presidents called by Arias for February 15 in San José to discuss his plan, clearly designed to be against Nicaragua.

This anti-Nicaragua meeting coincided with a trip through Central America by Democratic Senator Christopher Dodd. All speculation about the visit suggests that Dodd explained to the Central American leaders what a Democratic Party policy toward Nicaragua would be, based on an end to contra aid and containment of the Sandinista revolution through political, economic and diplomatic rather than military means.

As a result of Dodd's visit the Arias plan underwent a transformation in San José to become the Arias plan we now know, which states as a first and fundamental measure that the Central American governments should ask the United States to stop contra aid. President Cerezo of Guatemala also played a part in putting the brakes on the initial Arias plan, refusing to sign any agreement in San José unless Nicaragua were included. He got agreement, probably proceeding from Dodd's proposals, to present the new Arias plan to Nicaragua and put discussion of it on the agenda for a summit of Central American Presidents to be held in Esquipulas, Guatemala—the same summit now postponed until August. But before it even got off the ground, El Salvador and Honduras were already expressing serious difficulties with the second version of the Arias plan.

The gambles of the Guatemala summit

This summit was a high-risk political gamble—very high-risk, in fact, since discussion of the second Arias plan was becoming the central point on the agenda. This version as well as the summit itself had become possible because of the general perception in the United States, Latin America and Central America that Reagan's policy towards Nicaragua was doubly weakened: on military grounds because of the continual defeats suffered by the contras and on political-diplomatic grounds because of the Iran/Contragate scandal.

In these circumstances an educated guess can be made about Dodd's message to Arias: Costa Rica should begin to distance itself from the Reagan policy and come closer to a new policy towards Central America that the Democrats, very probably Reagan's successors, would pursue. Another factor leading Costa Rica to begin to distance itself from the Reagan policy was Arias' perception that the continuation of the conflict in Nicaragua affects the stability of Costa Rica and is incompatible with the needed reactivation of trade among Central American countries, crucial if Costa Rica is to limit its excessive dependence on US aid to prop up its sagging economy. Moreover, the Tower Report embarrassed Costa Rica by making public the pressures the Reagan administration exercised on its government. Finally, Arias has wanted to create an international image of himself as a promoter of peace in Central America, putting himself forth as a statesman of stature who deserves a Nobel Peace Prize and would give Costa Rica a position of leadership in Central America such as it has never held.

President Cerezo is also playing an important foreign policy card in adopting a posture of relative independence from US policy, offering his country as the host for the presidential summits and thus keeping alive the project to create a Central American Parliament. Apparently unable to bring about any substantial improvement in his country’s critical economic situation and lacking the power to lead the military along any other path than that of repression, Cerezo seems to be relying on his foreign policy to bring dignity to his presidency and assure the continuance of civilian governments in Guatemala.

Part of the Democratic Party in the United States, aware of the growing unpopularity of contra aid and looking for a way to reduce military spending in order to confront the growing fiscal deficit, found in the Arias plan a possible alternative platform to the military policy of the Republicans. If the Central Americans were to reach some understanding among themselves and keep the Nicaraguan revolution within its own borders, the Democrats seem to be able to live with a Central America which, generally speaking, would remain relatively docile. The Democrats would reserve the right to wield economic sticks to keep Nicaragua in economic crisis, thus forcing it to present to its neighbors and the world the image of a revolution in tatters. They would move beyond the Republicans' policy of armed confrontation towards one of economic containment.

Nicaragua was willing to discuss the Arias plan because it includes a basic position of the Sandinista government: an end to US aggression as a premise for beginning any negotiations. Furthermore, Nicaragua sees the presidential summit as the most striking refutation of the Reagan propaganda claiming that the Nicaraguan revolutionary process is a threat to the other Central American governments. If the five Presidents can sit down to talk, even if in the worst-case scenario they don’t arrive at any immediate agreement, the basic message that dialogue is the only way to solve conflicts cannot be avoided. By discussing the Arias plan, Nicaragua risks the disadvantageous outcome that the negotiating framework of a peace settlement might become less Latin American and more US/Central American. In view of the lack of autonomy shown by the Central American governments regarding US policy, this was a real risk indeed for Nicaragua: the possibility that Contadora and the Support Group might be cast aside. It must be noted that Contadora and the Support Group drafts never accepted some of the Arias plan’s interventionist aspects, such as the supervision of internal electoral processes by international agencies.

On the other hand, it is obvious that the Reagan administration was also running a risk with the presidential summit and the Arias plan: the failure of its policy, insofar as it is based on presenting the Nicaraguan contras as an autonomous force against the totalitarian power of the Sandinistas. The fact that the Central American Presidents would be getting together and discussing a plan whose first point is ending aid to these contras, plus the fact that this would have the support of three of the five Presidents (Ortega, Arias and Cerezo), made it less likely that Reagan would get new funds for his "freedom fighters" in the next congressional vote. In view of this basic problem, anyone analyzing the situation could foresee that the United States would respond to the Arias plan by doing everything possible to neutralize it or remove it from the scene. And that was precisely what it did.

The summit was first scheduled for May but was postponed until June. To do that, Arias claimed that he needed to get European support for his plan, which would be kept within an exclusively Central American context. But the governments he visited in Europe insisted on linking his plan to the Contadora process. The results of Arias' trip ended up convincing the Reagan administration that it was necessary to postpone the meeting and manipulate its agenda in such a way as to turn it into a trap for Nicaragua. This led to Habib's trip, barely two weeks before the five Presidents were to meet in Guatemala.

Once the way had been cleared in the US Congress for Honduras to get the F5-E fighter planes it had requested, the Honduran government began to express serious concern about the problem of resettling the contras in the event of an end to Reagan's support for them. Furthermore, the contras' defeat would be accelerated with any progress on the Arias plan. In view of this, Honduras needed time to arrange with the US government how the contras would leave Honduran territory.

Finally, accepting the Arias plan would also be risky for El Salvador, which was facing an important military advance by the FMLN and the increased development of the Salvadoran mass movement, with unions and other grassroots organizations becoming highly active during the first half of 1987. Accepting the Arias plan would mean having to return to the negotiating table to discuss the question of foreign military advisers in El Salvador, a general amnesty for all insurgents and a mandatory dialogue with the FDR. Moreover, the Salvadoran government and armed forces are so totally dependent on the US government that they had little chance of resisting Reagan's pressures to postpone the summit. No one knows better than Duarte that his government’s political survival is at risk with the Arias plan—a risk the plan does not entail for the Sandinista government. The Nicaraguan government has never seen masses of people in the streets of the capital to repudiate Sandinista policy. But the Salvadoran military have seen just that, and have confronted them.

On June 13 President Duarte, the "weakest link in the chain," asked that the summit be postponed. Even though this meant a real crisis, Honduras and Costa Rica quickly accepted it as an accomplished fact.

Arias plan dies in the White House

By trying to break the fragile and dependent desire for peace of the Central American governments, the Reagan administration showed once again that it had no desire for peace. While Arias' trip through Europe had put his peace initiative into the international limelight, and as a result a direct attack on it would cost a great deal politically, it was a cost the Reagan administration did not hesitate to pay.
After the meeting between Habib and Duarte led to the postponement of the summit, Guatemala, lamenting the Salvadoran decision, immediately agreed with Honduras and El Salvador on a new date. Arias, having no other choice, accepted the new date a little later, indicating that any continued postponement would be "a mockery" of the peace efforts. Cerezo stated more clearly that "the whole world will think it was US influence that determined the failure of this meeting."

But it was Nicaragua’s President who exposed the US maneuver most clearly, saying that the preliminary meetings of foreign ministers would only be a "waste of effort." If the Arias plan is seen as a variant on the Contadora Treaty, and it is recalled that there have been many meetings of the technical teams of the Contadora foreign ministries and indeed of their ministers themselves, then there seems no need to have at least three prior meetings of ministers, as Duarte proposed when postponing the summit. Furthermore, in view of the fact that in Esquipulas in May 1986 the Central American Presidents were unable to sign the agreement previously prepared by their Vice Presidents, it is understandable that Nicaragua is critical of the idea of having preliminary meetings of the foreign ministers. "We are the ones, as Presidents, who can make firm decisions at difficult times," said Daniel Ortega on June 17.

Looking toward the Guatemala summit, the five Presidents were aware that it would achieve some of its potential simply by being held and thus keeping the governments "in a state of dialogue" and on the way to concrete agreements. For instance, agreements on matters like bilateral border commissions, economic cooperation and refugees seemed quite possible. Other more basic issues would have to be taken back to Contadora for renewed negotiation on the treaty.

With the postponement, the summit moved from the realm of a near and viable reality into the more shadowy world of possibility: The summit would supposedly be held within two months, but there was fear that it might never take place due to some predictable stagnation in the foreign ministers' negotiations. Moreover, if the ministers' meetings failed or came to a standstill, it would be a simple matter to attribute the failure to Nicaragua's intransigence, since Contadora would not be taking part in these meetings. Nicaragua had indicated that these meetings would not be about the Arias plan but, in Ortega’s words, "the Habib-Duarte plan." This US plan would probably involve renewed insistence on dialogue between the Nicaraguan government and the contras and on holding elections in Nicaragua, not "in the time frame established in the respective constitutions," as called for by the Arias plan, but sooner. If there were no consensus on these and other points, the summit set for August could be postponed once again, thus regenerating stagnation.

Meanwhile, September, the month in which Reagan asks Congress to renew military aid to the contras, would roll around. A good pretext to pressure Congress to vote for the aid would be to present Nicaragua as boycotting the Arias plan; this would show the need to keep pressuring it through the FDN’s military actions.

But what was really behind the summit’s postponement came out clearly with Arias' visit to Washington and Reagan's stormy reaction to the Costa Rican President and his plan. Arias had an appointment in Indianapolis and was hoping to talk with Vice President Bush in Washington, as he later did, but Reagan invited him to the White House and confronted him with Carlucci, Elliott Abrams and Habib. Arias himself commented that what became clear in his talk with Reagan was that the plan is incompatible with Reagan's desire to continue helping the contras. Reagan had already affirmed publicly that he would keep up that aid until the last day of his tenure in office, and just an hour after the Reagan-Arias conference, the White House reiterated that policy and suggested that the Arias plan should be changed to make it acceptable to the US government. Arias stated that he did not agree with Reagan's suggestion. Reagan's actions showed the accuracy of the Nicaraguan President’s analysis the previous day.

A high-level official of the Nicaraguan foreign ministry told envío: "The US reaction to Arias and his peace plan really surprised me, since Arias is a US ally and his plan was, at least for a time, a useful tool to the US. We expected opposition to the plan to come later and were surprised that it came so soon and in such an open and heavy-handed way."

In case there is any need for further confirmation of the analysis of the result of the summit's postponement, Senator Dodd reacted to the White House statement by noting that Reagan was giving verbal and public support to peaceful solutions while in reality undermining them. "In spite of the fact that he said he supported the plan," Dodd said, "it is a fact that he opposed it from the very start. He instructed his ambassadors to oppose it, and sent his officials from one capital to another [in Central America], suggesting how to destroy and even kill off the plan." Dodd predicted that in September Reagan will once again use the plan in his request for more contra aid, claiming that military pressures are necessary to get Nicaragua to accept the plan.

In the diplomatic events of the first half of June, what became clear was the weakness and dependency of the Salvadoran and Honduran governments and the error in judgment made by the Costa Rican government in working out a peace plan thinking that the Democrats were already in the White House. Arias, wanting to create some space between himself and a militaristic policy and develop his international image as a champion of peace and democracy, had to witness Reagan's shameless undermining of his plan. In any event it is clear that although Reagan delivered a mortal blow to the plan, President Arias gained international credibility merely for putting up some opposition to Reagan in a meeting one Costa Rican official described as "bitter, tense and forthright."

Contadora: A way out

In the days following the Reagan-Arias meeting, a series of European and Latin American statements pointed to a way out of the crisis: a return to the Latin American Contadora peace process. Spanish President Felipe González, visiting Brazil, put forth a European perspective, which he had expressed to Arias during his visit: "The road to peace continues to be the regional effort represented by Contadora. There is no other. Regional conflicts find a better response in a regional arena and are only aggravated when seen in terms of an East-West confrontation. The region has a right to seek peace through its own efforts."

In Philadelphia, Argentine President Alfonsín confirmed his government's position against contra aid and recalled that the Arias plan had received the backing of the Contadora and Support Groups because it followed the same lines as the Caraballeda Declaration. Foreign Ministers Consalvi of Venezuela and Sepúlveda of Mexico respected Nicaragua's decision not to attend the rescheduled summit meeting in August as "a sovereign decision," even though they surmised that the crisis provoked by postponing the summit meeting pointed towards the revitalization of the mediating role of the Contadora and Support Groups.

At Duarte’s suggestion, the first meeting of foreign ministers was to be June 25—the very date originally scheduled for the Central American Presidents’ summit meeting—and was to be held in Tela, Honduras. Duarte himself remained silent after announcing the postponement of the presidential summit. Azcona took up the baton, declaring that the meeting of Presidents would have to go on, with or without Nicaragua. When Guatemala decided not to attend the Tela meeting, its decision was strongly criticized by the Honduran foreign minister, who accused Guatemala of taking a position "similar to Nicaragua's." One Honduran official, taking refuge in anonymity, went even further: "Guatemala has lost all moral authority to talk about neutrality in the future, now that it has shown its clear alignment with the Nicaraguan position." From the Honduran point of view, Guatemala could only be neutral if it backed Honduras, El Salvador and Costa Rica in their opposition to Nicaragua, thus fulfilling Reagan's dream of four against one.

In the meantime, Costa Rica was walking a tightrope. Without accepting modifications to his plan, Arias agreed to go to the ministers' meeting in Tela and promised to convince Daniel Ortega to attend the postponed summit. Arias said that Costa Rica agreed with the United States "in the ends but not the means" of resolving the Central American conflict, identifying those "ends" as the democratization of Nicaragua. In an interview with Time before his trip to Washington, he said, "After more than 40 years of the Somoza dictatorship, the Nicaraguan people deserve more than another extremist dictatorship." But moments before meeting with Reagan he spoke out of the other side of his mouth on Voice of America: "Nicaragua is David, struggling with Goliath. It is a tiny country besieged by the contras, and behind them, the government of the United States of America, the most powerful government on earth.... I'm not in favor of a military solution to the problems of El Salvador and Nicaragua.... What I am hoping for [from Reagan] is that he will support my plan."

The pace of events accelerated on June 23. Guatemalan Foreign Minister Quiñónez announced his country's intention to request Contadora's mediation on the question of the Central American Presidents' meeting. A few days later it was disclosed that Guatemala had asked Panama to invite President Ortega to that country to talk him into attending the summit meeting. The invitation of Panamanian President Del Valle left no doubt as to what this trip was about: "The government of Panama looks with concern on countries with interests and links in the Central American region that continue to exercise pressure that hinders the efforts of this [Contadora] group and of the Central American countries. For these reasons I invite [President Ortega] to visit Panama June 24th to arrive at a solution that will allow the Guatemala meeting to take place, where the Arias plan and other peace initiatives will be considered in the spirit of Contadora."

On the same day it was leaked that in their bilateral meeting in Ixtapa, Mexico, the Presidents of Mexico and Argentina had discussed a plan for supporting Nicaragua in light of the military and economic harassment it was undergoing from the US. They were also reported to have discussed the reactivation of Contadora and a meeting of the Contadora and Support Group Presidents to be held before the end of the year.

On the 24th, Costa Rica announced that it would not attend the foreign ministers' meeting in Tela, and the Honduran government was obliged to cancel the meeting given the lack of support for it. Honduras then asked Contadora to assume "full responsibility for mediation of the Central American situation," given the failure of "the possibility of a direct negotiation among Central Americans."

In this context, Nicaragua announced in Panama its acceptance of August 6-7 as the date for the presidential summit meeting, communicating Nicaragua's decision to Contadora through Panama, whose government's "constructive efforts" it recognized. At the same time Nicaragua indicated that it would accept no new postponements or attempts to interfere with the meeting’s success. Nicaragua also urged that the Contadora and Support Groups be entrusted with arranging any consultations prior to the summit.

This month's intense diplomatic activity began with a Salvadoran-US maneuver to isolate Nicaragua in a hostile Central American atmosphere and ended with a Latin American challenge to the Reagan administration. This challenge expressed the intention of the majority of Latin American nations to reject US tutelage and interference by the US government in their internal affairs. The Reagan administration's weakened credibility forced its anti-peace, anti-dialogue positions out into the open before Arias, Europe and Latin America. In this situation Nicaragua again became a reference point for Latin American dignity and Contadora emerged as the symbol of a long-term, continental struggle. If the Contadora and Support Groups also manage to develop a plan for economic aid to Nicaragua, they will have made another important advance in challenging Reagan administration policies.

In Nicaragua, the struggle continues

June's intensive diplomatic efforts were waged in the midst of Nicaragua's efforts to revive the flagging economy and stave off an impending oil shortage, continued military vigilance against the contras' ongoing war against civilian and economic targets, and preparations for celebrating the eighth anniversary of the revolution.

Managing the economic crisis

The economic crisis was under discussion in the Sandinista Assembly on June 1. On June 6, in a variant of the weekly town meeting "De Cara al Pueblo," a nine-hour meeting with 1,500 participants from a broad spectrum of Nicaraguan society, the President of Nicaragua announced new measures for controlling the economic crisis. He announced that salaries would be adjusted periodically, tied to prices rises for 54 essential products included in the "basic market basket." He frankly recognized that production problems would not allow for a consistent supply of those 54 products sufficient for the needs of all, but promised that when they were available the government would make every effort to see that they got to all workers through reliable channels. He also announced the decision to make adjustments in the exchange rate between córdobas and dollars on certain imports to somewhat reduce the fiscal deficit and called for a 5% reduction in fuel consumption in state agencies as well as public sales. Finally he announced a cautious rise in the prices of gasoline, diesel and butane fuel, which could be a trial balloon to find out how much influence rising fuel prices have on inflation.

In the discussion that followed the announcement of the new measures, President Ortega insisted that the economic crisis must be seen as the price Nicaragua has had to pay and will continue to pay for the ability to win the war with the counterrevolution. Several of the peasants and workers who spoke out from the audience affirmed that never before in Nicaragua had the great majority of the people had a relationship with the government in which their opinions and contributions were treated as worthy of consideration and never had they experienced such willingness on the government’s part to respond—within the scope of its ability—to their fundamental needs.

It is likely, however, that even if these economic measures work well, they won’t be sufficient. The Nicaraguan government's economic choices are tightly circumscribed by political realities, as it attempts to distribute products fairly in a situation of scarcity. Given this interdependence of political and economic policy, only a continuous reading of the results of both can show the way. June's economic measures have already demonstrated the beginning of a more creative strategy for confronting and "managing" the crisis. There are, of course, serious limits to what can be done, because the real source of inflation is the war, which profoundly affects the entire national budget and the productive capacity of such a very underdeveloped country.

Petroleum problems

Toward the end of May, the Minister of Foreign Cooperation Henry Ruiz announced that Nicaragua was facing difficulties this year acquiring sufficient crude oil for the economy’s needs.

Since 1985, the Soviet Union and the socialist countries of COMECON (including Cuba, which had already provided 50%) have supplied 90% of Nicaragua's fuel needs—in round numbers, 765,000 tons of crude per year at a value of approximately $225 million. This situation occurred when Mexico, under some pressure from the United States, decided to stop supplying Nicaragua on credit due to its own severe economic problems. (Mexico did continue to supply the oil necessary to produce asphalt.)

Ruiz made clear that the portion carried by the USSR of the oil quota agreed on with COMECON—40% or 300,000 tons—had already been delivered to Nicaragua. The deficit then, was in the portion of the quota due from other Eastern European countries.

On June 10, Nicaraguan Vice President Sergio Ramírez traveled to the Soviet Union and the other socialist countries of Europe, accompanied by Minister of Economic Planning Dionisio Marenco. Returning from this trip, Ramírez undertook another, to Iraq, Greece, Yugoslavia and Algeria, to continue efforts to get the necessary oil supply. A few days later, National Assembly President Carlos Núñez visited Iran, also with Marenco, on yet another mission connected with the oil deficit.

On June 11, the Mexican daily La Jornada reported that an official of the Mexican government's Secretariat of Energy had said that shipments of crude to Nicaragua would be resumed, indicating that this decision formed part of a comprehensive, long-term plan of aid to Nicaragua that the eight Contadora and Support Group countries were going to take responsibility for. The aid would be made up of petroleum, food and financial assistance. This news was confirmed by information leaked from the Ixtapa meeting of the Presidents of Mexico and Argentina, and later confirmed by President Alfonsín.

Since the end of May Nicaragua has begun asking the governments of Mexico, Venezuela and other Latin American countries for their help in overcoming the oil deficit. Still unknown is the final result of all these steps in Nicaragua’s quest for foreign financing of its vital fuel needs and its goal of diversifying as much as possible its dependence on oil for its energy supply.

The war goes on

The war continued with a vengeance this month. All indications are that the counterrevolution is desperate to demonstrate progress and thus influence the congressional vote on military aid expected in September, a vote all analysts consider crucial to assess the waning domestic support for Reagan's militaristic policy.

This month the contras continued to attack cooperatives and villages in isolated rural areas, later presenting these attacks as successful military actions against "Sandinista military bases" or against "military barracks." But the presence of international journalists in those places makes evident to anyone who wants to see and hear that are attacking small civilian and economic targets. The comparison between the tactics and attitudes of the contras and those of the Sandinistas towards the peasant population in the war zones was the subject of a cover story in Newsweek published June 1 with the telling title: "Why Aren't They Winning?" The article tried to show the US public that the contras’ tactics and attitudes leave much to be desired.

June 16, Lieutenant Colonel Hugo Torres, director of the Sandinista Army’s Political Office, presented a report explaining the contras’ probable military movements between now and September. The report covers the so-called "America plan," which would consist of infiltrating Nicaraguan territory with the greatest possible number of contras now quartered in Honduras, in an attempt to maximize the propaganda value of their actions and thus justify new US investment of military aid. The general goal is both to win the vote and seriously affect the country's economy, incapacitating the Nicaraguan peasant cooperative movement, which plays a key role in the revolutionary government's current rural economic strategy.

To effectively respond to the contras' actions in the central part of the country—where they are attempting to recreate a permanent base—the Nicaraguan government decided to evacuate the peasants from an area south of Nueva Guinea in Zelaya, resettling about 900 families in areas far from the war zone, providing them with a range of social services previously unavailable to the dispersed families living in a war zone and giving them fertile land to farm. The goal is to permit the army to prepare a major offensive without harm to civilians against the counterrevolution’s last important stronghold: the Jorge Salazar Regional Command, which operates in Region V (Boaco, Chontales and Central Zelaya). Meanwhile, the military decline of the contra forces throughout the country continues. This month, the Army reported that since the first of this year the contras have sustained 3,000 deaths, more than 2,000 soldiers who have laid down arms and a large number wounded and captured. On the Sandinista side, there have been 600 deaths during the same period. In the period from June 5 to July 5 the contras had 477 dead and the Nicaraguan Army 131.

Contra actions

Throughout June counterrevolutionary groups infiltrating Nicaragua have been very active, not in combat with the Nicaraguan Army but in attacks on civilian economic targets. In this month there were 55 such attacks, resulting in 33 civilian deaths, 44 wounded and 39 kidnapped. The principal attacks were:

- June 2, in the village of Abisinia in Jinotega. Twelve peasants died defending the village and ten were wounded. The contras destroyed two houses and the health center.

- June 3, Las Colinas, Jinotega. Six peasants were killed and seven others wounded, among them two children. The contras burned 35 houses and destroyed the health center and food distribution center.

- June 14, an attack on the settlement of Panalí in Nueva Segovia. Seven peasants were wounded.

- June 18, the village of Zompopera in Jinotega was attacked. Three peasants were killed and thirteen kidnapped, among them three children. The contras burned the food distribution center.

- June l8, the cooperative of Los Millones in Chontales was attacked. Five peasants were killed, ten wounded and two kidnapped.

- Attack on the village of San Ubaldo in Chontales. Twelve peasants were kidnapped and seven houses burned.

- June 24, killing of Chilean volunteer Manuel López Ibáñez, agricultural technician who was collaborating in a Danish assistance program.

- June 25, contra attack on Quilalí in an unsuccessful attempt to take the city.

On the legislative scene

While the war continued, so did legislative activity, with the reopening of the National Assembly session. The Assembly has an ambitious legislative package in this legislative period, which ends in December. A reform of the Assembly Statute and the for its functioning will be undertaken, based on the experience acquired in 1985 and 1986. Following that, the Assembly will tackle the law of amparo, the right to seek review of administrative acts; the reform of laws on the state of emergency and the electoral process; the law on foreign investment; the autonomy law for the Atlantic Coast; and the law regulating divorce procedures. The fierce debate that has already arisen between the opposition parties and the FSLN over the reform of the Assembly Statute is well known to the Nicaraguan public. The opposition is trying to give the Assembly’s Executive Council more power, which they hope would have the effect of increasing the influence of their own small parties and limiting the power of the Assembly president, a position currently held by Carlos Núñez, one of the nine members of the FSLN National Directorate.

From the ideological point of view, President Ortega's speech to the university community this month was quite significant. He spoke of Marxism as "scientific revolutionary thinking," appropriated "in a creative manner" in the Sandinista movement. He characterized the Sandinista movement as "our own expression, which develops revolutionary ideology within the Nicaraguan reality, taking into account the experiences of struggle of other peoples of the world." He affirmed the Sandinista movement as a process integrally connected to "our own Nicaraguan reality" that endeavors to shape a model corresponding to "the specific characteristics of our economy, the historical subjects of the revolution and our need for economic and social development," insisting once again on strengthening "our policy of nonalignment in the international arena, political pluralism and a mixed economy." (Nicaragua's problems in guaranteeing its oil supply have been interpreted by some sectors in Nicaragua as an indication that the country is indeed maintaining a policy of nonalignment, with all its attendant risks.)

President Ortega called on university students to respond in earnest to their opportunity to study, guaranteed to them by the soldiers’ sacrifice and the workers’ sweat. During the second half of June, the President held a number of meetings with directors of higher education institutions in the country to discuss how to improve university education.

The course of the Nicaraguan revolutionary process, through poverty and suffering, provides an open question in the crisis of values in today's world. The consolidation of fragile developing nations such as those in Central America can be pursued—as Nicaragua is trying to do—on the basis of full participation of the majority population in the nation's political, social and economic life. Or it can be promoted in a demagogic way and in fact imposed on people, from within or without. Guatemala’s still terrible domestic reality and the distressing events in Panama at the end of June testify to the drastic inadequacy of this second alternative.

Within the context of continued suffering by the Nicaragua people; with attacks on the cooperatives the most significant accomplishments in the countryside; with economic constraints that impose growing austerity and costly delays in development, Nicaragua this month engaged in an important diplomatic battle. The month marks a milestone for Latin America. A new stand is now being taken by Latin America, one that stands in opposition to the phony banner of democratization unfurled by the Reagan administration against any nationalist process, be it Nicaraguan or Panamanian.

Social injustice and democracy are today very real problems for our continent. The hypocrisy of the United States consists of presuming to preach democracy to the governments of our nations while manipulating them without the slightest respect for our interests, or the slightest attempt to change its own participation in the unjust conditions of an aging and ever more bankrupt international economic order. The struggle between Latin America and the United States became manifest once again this month. This situation is only one step on a long, slow journey to the emergence of the Third World, one step in a difficult transformation of the world order. Nicaragua today is a metaphor in miniature for this enormous effort.

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