Envío Digital
Central American University - UCA  
  Number 353 | Diciembre 2010



Knee Deep in the Big Muddy at Year's End

The Nicaragua-Costa Rica controversy bogged down Nicaragua’s foreign policy when the government refused to let conditions be imposed on it. At the same time, it had no choice but to accept the IMF mission’s imposed conditions. President Ortega used the crisis with Costa Rica to push forward his project: a legal swamp to bog down the country by putting all of society under military control.

Nitlápan-Envío team

Organization of American States (OAS) Secretary-General José Miguel Insulza described the geography of the Costa Rica-Nicaragua controversy as follows: “I specifically asked in Nicaragua about Calero Island. They told me that the island is Costa Rican and that Nicaragua doesn’t object to that. The controversy only affects the highest bit of Calero Island: three square kilometers where there aren’t even 30, 40 or 50 Nicaraguan soldiers, because there’s no room for any more. A battalion wouldn’t fit because it’s a marsh, a swamp, wet- lands.”

Soon after, Nicaragua learned about aspects of the national “geopolitics” hidden in the conflict: another swamp.

Our Río San Juan

Nicaragua’s “sovereignty and supreme domain” over the Río San Juan has been ratified repeatedly for over a century. The last time was in response to a suit Costa Rica filed with the International Court of Justice at The Hague in 2006, requesting the Court’s authorization to navigate the river with armed men, which was denied. Both the Court’s ruling on that suit in 2009 and the older ones have always established Nicaragua’s right to clean and dredge the river to recover its depth.

Successive Nicaraguan governments have consistently defended our territorial sovereignty rhetorically, but totally neglect the kind of concrete, day-to-day sovereignty that would provide people in that area with health care, education and development opportunities. The social abandonment has been proverbial. And the preserved environment that can be observed on Nicaragua’s side of the river is more the result of laziness, indolence and age-old indifference than any decided and sustained environmental policies.

Costa Rica has always had expansionist aspirations over the Río San Juan. Successive Costa Rican governments, with agroindustrial, tourist and livestock-based development criteria that don’t involve caring for the environment, have invested millions of dollars to develop the Costa Rican banks of the river. Among other things, they dredged the Río Colorado, an affluent of the San Juan, over half a century ago with very favorable results given the Nicaraguan governments’ disinterest and failure to react: 90% of the San Juan’s water now flows into Costa Rican territory. So in its own self interest Costa Rica has sought to prevent Nicaragua from dredging the San Juan and returning that water to its original course.

What sparked the conflict

Nicaragua’s President Daniel Ortega decided to put the extensive and politically delicate business of dredging the Río San Juan in the hands of Edén Pastora, a political personality who is anything but delicate. In October, Pastora showed up in the area with a small-scale dredging operation financed by companies linked to the business activities of the Bolivarian Alternative of the Peoples of the Americas (ALBA). Accompanied by Nicaraguan military, he started work by bursting onto Nicaraguan-Costa Rican properties, including a group known as “The Tarzans,” reportedly belonging to drug traffickers. The Tarzans haven’t been seen since, nor have they been arrested or accused in either country. Costa Rica alleges that the occupied area is part of its territory.

Pastora didn’t start dredging, but rather opened a ditch along the northeast point of the border Costa Ricans call Calero Island, which appears on almost all maps, including official Nicaraguan ones, as Costa Rican territory. The ditch, or creek, has been covered by sediment for a good century and according to Nicaragua marks the historic limits of the border, which fluctuates according to changes in the water level of the delta where the river flows out into the Caribbean Sea.

The fuss kicked up by the Costa Rican government was out of all proportion. A country that boasts of not having an army sent a contingent of some 70 “police officers” armed to the teeth, televised the military deployment and alleged that it had been the victim of an “invasion” by Nicaragua. As was to be expected, and has always happened for over a century, the spark of nationalism ignited real and puffed up patriotic fires on both sides of the border, with Nicas rejecting the Tico “thieves” and defending water while the Ticos rejected “touchy” Nicas and defended land.

As Peruvian Guillermo Nugent has rightly said, the boundaries of those colonial haciendas that our countries still amount to are what limit our “homeland.” “In the formation of nationalism in Latin America,” he stated, “the question of territories has always had a disproportionate importance.” And in evoking the colonial past and wondering why such disproportion in the defense or conquest of some territory persists in so many conflicts, he hypothesized that “territory was the most shared thing there was. There were no other shared sentiments in our societies. The national territory was like the imaginary expansion of the hacienda, and in haciendas boundaries are the most important thing.”

The OAS resolution was favorable to Nicaragua

Costa Rica asked the OAS Permanent Council for an urgent extraordinary session to iron out what it claimed was not a border dispute, as the OAS doesn’t have jurisdiction in such issues, but rather a military “invasion.”

On November 2, President Ortega responded with a “message to the nation” in which he presented Nicaragua’s position with precise and measured words. He reported that the central position Nicaragua would present to the OAS was that Costa Rica had repeatedly refused to demarcate the border with physical markers.

The President has never received such unanimous backing in his nearly four years in office. All national forces, sectors and opinion makers closed ranks. Although there was excess in the speeches of some official spokespeople, hailing Ortega as the “greatest statesman of the century” and calling the national unity “sealed,” no one could question the justice of the President’s arguments because that day he indeed spoke like a statesman.

In the OAS session of November 3-4, Nicaragua won a clear victory when the members unanimously backed a proposal to promote bi-national dialogue with mediation by the OAS Secretary-General rather than sanction Nicaragua, which Costa Rica was calling for.

José Miguel Insulza visited both countries, spoke with both Presidents and flew over the zone to verify the disputed three square kilometers and observe the ditch Nicaragua was digging. In presenting his report to the OAS Assembly on November 11, he submitted a four-point resolution for approval by the member countries, three of which clearly favored Nicaragua.

That resolution didn’t sanction Nicaragua either. Rather it urged both countries to hold their scheduled eighth meeting of the Bi-national Commission on November 27, with OAS accompaniment, and to resume talks about demarcating the border in accord with previous treaties and awards (on which Nicaragua had based its argument). It also urged the two countries to reinforce their cooperation mechanisms for dealing with drug trafficking in the area, and to generate the right climate for dialogue by withdrawing their respective armed forces “in the area where their presence could generate tension” (the swamp).

Diplomacy bogs down

For seven interminable hours, Costa Rica raised its rhetoric again and again against the “invader” and Nicaragua’s representative to the OAS constantly repeated, with a lack of flexibility bordering on crudeness, that Nicaragua “doesn’t accept conditions” and thus would not withdraw its military from the swamp as a sign of good will.

Nicaragua lost the initiative with such repetitive argumentation, and its position became so increasingly incomprehensible that finally 21 countries approved the resolution. Nicaragua was supported only by Venezuela, Ecuador and Bolivia, all ALBA countries. The Caribbean countries that receive Venezuelan oil through Petrocaribe opted for abstention as they couldn’t grasp Nicaragua’s rigid arguments against a resolution that clearly benefited it. Nicaragua lost allies to its cause and turned a bi-national difference into an international dispute that was hard to grasp beyond the river.

Ortega’s November 12 speech to try to explain what had happened in the OAS was provocative and extravagant. Reiterating that no military personnel would abandon the swamp because they were defending sovereignty and fighting drug traffic there, the President attributed the result of the voting to a “drug trafficking conspiracy.” He also reported that Nicaragua was withdrawing its representation in the OAS, threatened to pull out of the Inter-American political forum altogether, announced that he would turn to The Hague to request authorization to navigate freely in Costa Rica’s Río Colorado and accused Mexico, Colombia, Panama and Guatemala of being infected with drug trafficking. As for Costa Rica, he stated with irony that drug mafias were directing its foreign policy, while presenting Nicaragua as the country “containing” drug traffic in the region.

With that, the image of responsible statesmanship Ortega had fashioned over several days of “patriotic fervor” began to fall apart. And cracks appeared in the ephemeral “national unity” his first declarations helped forge.

After the November 11 OAS session in which Nicaragua lost the diplomatic initiative, Carlos Argüello, Nicaragua’s ambassador in The Hague, a man with more than two decades of diplomatic and juridical experience, was urgently called back to Managua. With a very professional discourse, Argüello tried to explain the government’s hitherto erratic and confrontational strategy. In an exception to the rule, the government even allowed him to be interviewed extensively on Carlos Fernando Chamorro’s daily TV program “Esta Noche.”

To improve its strategy, the government also rapidly drafted and distributed a “white book” on the “truths that Costa Rica is hiding,” which explains a series of historic, juridical, military, ecological and other factors. It also published a pamphlet announcing that it will ensure various tourist routes to the San Juan.

Ortega didn’t attend the bi-national Presidential meeting programmed for November 27, ostensibly because he refused to accept “condi¬tions.” Nor was he present at the Ibero-American Summit in Argentina, where Costa Rica’s President took the opportunity to explain her version of the case to her colleagues. And finally, Nicaragua was not represented in the meeting of OAS foreign ministers on December 7.

Questions, questions…

Amid all the voices reaffirming Nicaragua’s sovereignty over the river and recognizing Costa Rica’s expansionist intentions, more voices started proposing, even insisting on the urgency of the bi-national dialogue. Some of these voices that broke ranks were full of questions. What sovereignty would we be losing by withdrawing a handful of soldiers from a swamp? Do we really have military the length of the river? Why make the military presence the heart of the problem if the problem is really political? Why hasn’t the government given a detailed account of the costs, deadlines and goals of the dredging operation?

What’s the sense of concentrating the energies of two countries with common histories, families and geography and such urgent problems on a dispute over three square kilometers of territory? Wouldn’t a deep river channel also be advantageous for Costa Rica? If we’ll always be neighbors, don’t we win more by cooperating than by fighting? If this could intensify xenophobia against the half million Nicas working in Costa Rica, why not work things out through dialogue as soon as possible? Is rectifying a sign of weakness?

What private economic interests are hiding behind the façade of national interests in both Nicaragua and Costa Rica? Which Costa Rican companies put so much high-flown language into that country’s diplomacy? How many international interests have climbed on board this inflated conflict or will want to do so? What political advantages does Costa Rica’s new government think it can get out of this dispute? Why did the official slogans in Nicaragua link the issue of the river to Ortega’s reelection if one thing has nothing to do with the other?

Prolong the conflict?
Militarize it?

Nicaragua ended up isolated, bogged down in the big muddy of the Río San Juan due to the inflexible script Ortega directed from Managua for retired General Denis Moncada, Nicaragua’s representative in the OAS; the levels of improvisation that script contained; and the strange decision to continue the conflict by accepting no conditions. Prolonging the conflict and militarizing it seems to have been not an inadvertent escalation but rather President Ortega’s strategy.

Prolong the controversy? The opportunity has been lost to accept the favorable OAS resolution for a quick end to the conflict and to discuss the many other topics that require cooperation. Instead Costa Rica has grabbed the advantage, reinforcing the world’s generalized perception of our neighbor as a peaceful country unjustly attacked, while at the same time getting the drop on Nicaragua by filing a request with The Hague for “preventive measures,” specifically that Nicaragua be ordered to stop dredging the river, its central objective from the start.

Militarize the controversy? It’s incomprehensible that moving a dozen soldiers three kilometers in one direction or another would harm national sovereignty. The sloppy argument all official voices have repeated is: “No one leaves his own home.” But Costa Rica did. On November 17 it withdrew its armed security forces from what it says is “its home.” Furthermore, nothing could affect Ortega’s image more than being perceived again as military-minded with bellicose language. Nonetheless, the ensuing days demonstrated that the President isn’t setting out just to militarize the controversy. His political objective was to militarize the country.

Three very dangerous laws

Everything points to a prolongation of the crisis. It would also seem that prolonging and militarizing it is in the political—and perhaps even economic—interests of both governments.

On one riverbank, President Chinchilla announced that she was sending new contingents of security forces to the border, calling up the reserves. Again arguing that Costa Rica has no armed forces, she sent Ortega an insulting message: “Only cowards are brave before the defenseless.”

On our side, President Ortega not only refused to pull his soldiers out of the swamp, he took advantage of the patriotic fervor to make a new move in his project to secure power and social control. At the end of November, he sent three bills to the National Assembly, requesting that they be approved within hours: the National Defense Law, the National Security Law and the Juridical Border Regime Law.

These laws give the Army of Nicaragua extraordinary powers in situations of conflict or emergency and in the border zones in all situations, subordinating civilian institutions to military power and converting national security into a platform for political espionage.

Presenting them at this time and with this urgency could only be understood in a country at the brink of war or under imminent external threat. They are dangerous laws, both in what they say and in what they don’t say: they are drafted in an ambiguous fashion so open to interpretation that they lend themselves to total discretion when their regulatory laws are drafted or when they are actually applied, both of which are tasks that fall to the President—including the definition of what constitutes a conflict, external threat, emergency or terrorism…

Major backpedaling

These laws suggest dangerous democratic backpedaling after all the energy the armed forces put into transforming itself from the party army of the eighties to the “professional, nonpartisan, obedient and non-deliberating” institution it is today. This democratizing effort won the army great respect and confidence from the Nicaraguan population.

These laws seem to be of top interest to both the President and the army itself. For the first time officers of an institution committed to not deliberating on political matters lobbied legislators from the different National Assembly benches to get all three laws, with their clear political objectives, approved on a super fast track.

Also significant was President Ortega’s angry reaction to any critical voices. In the closing act of a military activity he dubbed those who commented on the dangers of their scope “reincarnated traitors who always go looking how to do Nicaragua harm, people who would sell their homeland, puppets who take the side of Costa Rica’s expansionist policy because they simply don’t think like Nicaraguans.”

The three bills—designed by the President some time ago but presented now to fish in the “turbulent waters” of the San Juan—invert the democratic equation requiring the subordination of military power to civilian power. One doesn’t need to be a conspiracy theorist to imagine the short-term political objectives, such as allowing the President to decree a situation of “conflict” if, for example, a fraudulent electoral process sparks protests. And then there are medium-term objectives, such as silencing the media, critical voices, organizations and the like.

The ghosts come out

One of the laws establishes that in cases of conflict or emergency the national defense plan will be a “state secret.” It also establishes that, at the President’s order, the army will direct the “mobilization” to deal with the crisis in such cases, dedicating “the public forces, means and goods; and the governmental, municipal and regional dependencies and institutions and their officials to defend the supreme national interests and strategic objectives.” This disposition naturally sparked fearful memories among the population, summoning the ghost of obligatory military service.

It was also worrying that another of the laws assigns the coordination of all economic, tourist and development programs in the border areas to the military, even in peacetime, generously defining an area 15 kilometers inside the demarcation of all land, maritime and lake borders as state lands under military control. This raised another ghost from the depths of the collective memory: that of confiscations and expropriations.

The laws whipped up a storm of alerts in public opinion and an avalanche of reform motions by legislators. In the end, the laws weren’t fast tracked, but the complicity of the Constitutionalist Liberal Party (PLC) in their approval soon became evident in what appears to be a new stage of the pact between PLC leader Arnoldo Alemán and FSLN leader Daniel Ortega.

Conditions accepted

While the dispute with Costa Rica was bogging down and President Ortega was preparing this legal “ambush” that could bog down the entire country, the president of Nicaragua’s Central Bank announced that the government had finally passed with the fifth review of its agreement with the International Monetary Fund (IMF) with flying colors and that the agreement had been extended through electoral year 2011. To achieve this, Nicaragua had to accept 14 conditions.

In June 2009, President Ortega called the IMF the “Death Fund” for setting conditions to extend the agreement for only one year. Those conditions, Ortega said at the time, “are a death threat for Nicaraguans’ economy and for the country’s stability…. They’re treating us like slaves…. The International Monetary Fund is trying to put Nicaragua at the edge of an abyss.” Whether at the edge of an abyss or a swamp, it is true that the IMF has put the screws to the government.

Among the main commitments the government has assumed is a severe restriction of the fiscal debt, which means reducing social spending (education and health) and public investment; and a shrinkage of the domestic debt, which implies increasing the resources the government budgets for paying interest and capital on that debt. There are also various unpopular reforms to Social Security, while the $25-a-month extra-budget bonus that Ortega has given to low-income public employees since May with Venezuelan funds must be incorporated into the calculation of the fiscal debt. The IMF considers the money involved in the latter case to be a “contingent risk” that must be included in the macro economic calculations.

The IMF takes a close look
at Venezuelan Cooperation

The most interesting item on the list of conditions is that, for the first time, the IMF has decided to take a close look at Venezuela’s cooperation funds. Calculations are that its “oil cooperation” for 2010 reached the impressive figure of $516 million. This cooperation has never appeared in the national budget or been subjected to institutional control. Now, starting in March 2011, the government’s “Aid Report” must include information on the use it’s making of these funds “by economic sector.”

Also significant is the financial monitoring the IMF is requiring of the government. The voluminous Venezuelan resources received most recently and deposited by the government in three national banks have triggered spectacular growth in dollar deposits. According to official figures, they tripled between July 2009 and July 2010 then suddenly dropped by $200 million in September 2010. As Civil Coordinator economist Adolfo Acevedo commented, “One might wonder what non-financial corporations in Nicaragua have the capacity to make such movements in just a few months.” These massive movements also alerted the IMF, which conditioned the extension of the agreement to the immediate issuing of official monthly reports on bank deposits associated with the Venezuela-related aid flows.

According to the IMF, the government authorities clarified that all flows related to Venezuela’s oil collaboration assistance (which amounts to half its total oil bill) are concessional loans from Venezuela to the Nicaraguan financial cooperative Caruna, which distributes about half the funds as grants and invests the other half for profit. The IMF staff’s preliminary conclusion is that this modality implies an increase of recorded private foreign debt at the end of 2009 of about 5% of the GDP.

For years, civil society has been demanding transparent information from the government about the Venezuelan funds President Ortega receives directly and administers at his discretion. As the government turned a deaf ear, it called on the IMF to require it of the government.

The reason the IMF has finally chosen to do so now is that Venezuela shifted its oil cooperation with Nicaragua from the ALBA framework, where it was reported as a “donation,” to the Petrocaribe framework, where it is “reimbursable credit” that’s indebting Nicaragua. The IMF’s priority in its relationship with the Nicaraguan government is macroeconomic “health.” Its decision also coincides with the change of the correlation of forces in the Venezuelan parliament, with the return of the opposition, which will surely require transparent accounting for the resources the Chávez government is granting so generously to various countries, Nicaragua among them.

The National Assembly approved the 2011 national budget with 80 votes on November 30. FSLN legislators together with those of different Liberal benches praised the budget for its adjustment to the IMF macroeconomic guidelines. In the final voting, only the three Sandinista representatives of the MRS and the Movement to Rescue Sandinismo opposed it, as it included a line for over $1.5 million to the Supreme Electoral Council to pay a debt contracted by its president, Roberto Rivas, who has never explained the use of these funds. Rivas is still de facto occupying that position even though his term ended months ago.

A country with swamps

During this intense month, the electoral landscape has changed little. Alemán and his unconditional circle in the PLC issued clear signs of continuity in their pact with Ortega in the form of reincorporating PLC justices and comptrollers into their posts, embracing the illegal presidential decree that keeps them there beyond their term until their replacements are elected; agreeing to maintain for another year the National Assembly’s directive board, whose correlation is an expression of the pact; and going along with not electing for now the posts of 25 top officials whose term has ended, thus prolonging that decree and keeping the profoundly discredited Supreme Electoral magistrates in charge of next year’s elections.

Alemán remains immovable in his determination to run for President, knowing that if he pulls out he’ll soon be back in court for three pending corruption cases administered by courts faithful to Ortega. His unconditional backers remain equally immovable in supporting this losing candidate and potential prisoner, knowing that hanging on to their own top state posts depends on Alemán continuing to be Ortega’s partner in the pact, which is what gives him posts to hand out.

Fabio Gadea’s popularity is still growing among Liberals with the important result that it’s increasingly eroding the Alemán option. This month’s novelty was the support given Gadea by the Sandinista Renovation Movement (MRS). Its incorporation increases the pluralism of the Gadea team, which up to now has been predominately Liberal. The MRS has made it clear that its support ends if Alemán joins the team.

In its initial campaign strategy document, the governing FSLN warned its militants of its main fear: opposition unity. “It’s useful to permanently monitor the efforts of their imperial sponsors to unify the rightwing forces and the possible appearance of new leaders within them,” says that docu¬ment. Gadea is banking on unity and is seen as a “new leader” despite the fact he’s about to turn 80.

The governing party still hasn’t built the swamp in which it hopes to bog down Gadea’s candidacy, but it’s working on it. The prolonged and always agitated and politically productive parenthesis of the December fiestas will give it enough time to contemplate, calculate, machinate and conspire.

The swamp of frustration

The governing party appears confident. It’s entering December showering us with Christmas lights, gifts and promises. Its spokespeople are announcing that it will win with 60% of the votes, ensuring the longed-for parliamentary majority that will consolidate Ortega’s power project. Perhaps they’re forgetting what biologist Humberto Maturana said: “Leadership doesn’t last in the absence of creative participation and neither complaints nor thoughtful questions can be detained indefinitely without the emergence of frustration, anger or apathy.”

Swamps are made of just such frustration, anger and apathy. They are what put a country knee deep in the big muddy.

Interests in the Río San Juan area
Several social organizations in Nicaragua and Costa Rica warned of environmental problems caused by the controversy over the Río San Juan. Among other things they noted that “there is evidence of the presence in the area of many national, regional and transnational interests that are directly affecting the Indio Maíz Biological Reserve, designated as Patrimony of Humanity; the RAMSAR Caño Negro (Black Creek) wetlands and the protected area of the Colorado Spit… And on the Nicaraguan side there are hydroelectric plant projects that are part of what was previously called Plan Puebla Panama and huge extensions of German-financed African Palm cultivation designed for the production of biofuels… The dredging itself, extending 32 km toward Punta Castilla, is the first step of a border development strategy in the San Juan delta that includes the construction of an airport with a 1,200 meter long runway valued at $7 million. The Río Colorado, surrounding wetlands and aquatic life would be significantly affected and environmental consequences are predicted as well in other affluents of the San Juan (the Frío, San Carlos and Sarapiquí rivers), the Caño Negro wetlands and Costa Rica’s forested zone.”

The Brazilian company Andrade Gutiérrez, in charge of the Brito hydroelectric mega-project, which in the view of Nicaraguan scientists and environmentalists will provoke a mega-disaster in the biodiversity and the flow of the Río San Juan and Lake Cocibolca, is continuing to work in the area despite the announcement that President Ortega had “frozen” the project. Subsequent explanations by other officials have been confusing, and the company has announced that “it came to stay.” Meanwhile, environmentalists point out that there’s no clarity about the governmental decision, and warn that there’s no sense in dredging the Río San Juan to recover its depth if this mega-dam is built.

In late November an Administrative Contentious Tribunal in Costa Rica ordered the cancellation of a mining concession for the Las Crucitas project of Industrias Infinito, an affiliate of the Canadian mining company Vanessa Ventures. The plan was to build an open-pit gold mine in northern Costa Rica near the border with Nicaragua that would have contaminated the waters of the Río San Juan. The tribunal recommended that former President Oscar Arias be sued for declaring in a 2008 executive decree that the investment was in the “public interest.” The tribunal also ordered the mining company to pay an indemnification for the cutting down of 150 hectares of forest in only three days for the installation of the mine. The project manager will appeal the sentence.

The exploration for that project started in 1995 but Costa Rican envir¬onmentalist groups, later joined by Nicaraguan ones, have fought ever since to stop the project with continuous information, mobilizations, hunger strikes and multiple legal recourses. If the project had gone ahead it would have contaminated the Río San Juan with cyanide, used for the extraction of gold. The company has invested US$127 million in Costa Rica, without yet extracting a single ounce of the 1.2 million calculated to be in the ground. Nicaragua has two open-pit gold mines: El Limón in León and La Libertad in Chontales, which are contaminating the waters of nearby rivers with both cyanide and arsenic while the national authorities turn a blind eye.

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