Map
Of Nicaragua
Economy—overview:
The
Nicaraguan economy, devastated during the 1980s by economic mismanagement
and civil war, is beginning to rebound. In 1991 President CHAMORRO launched
an ambitious economic stabilization program that reduced inflation and
obtained substantial economic aid from abroad. Economic growth rose sharply
in 1995-97, due to surges in exports and efforts to enhance trade liberalization.
The program, however, hit some snags, and a 1994-97 IMF Enhanced Structural
Adjustment Facility (ESAF) signed by the CHAMORRO administration with the
Fund lapsed in September 1996 due to non-compliance. In 1997, however,
the IMF resumed negotiations for an ESAF with the ALEMAN administration,
and agreed to an ESAF in 1998. IMF approval of the ESAF cleared the way
for debt relief by the Paris Club later that year and has opened the way
for debt relief under the Highly Indebted Poor Countries Initiative. Implementation
of a 1997 property accord—designed to resolve conflict over properties
confiscated by the Sandinistas in the 1980s—should also help inspire international
investor confidence. Strong growth is forecast for 1998, with implementation
of a 1997 free trade agreement with Mexico expected to boost agricultural
exports -  |
