How Nicaragua's Success Story Could End

A decade ago, Nicaragua's sluggish economy relied primarily on agricultural exports, including coffee and beef. But during the past 10 years, Nicaragua has cultivated its longest run of political and economic stability since 1979. The country has leveraged its low wages and preferential trade with the United States to attract investment into clothing factories, helping the country's export revenue quadruple between 2007 and 2014. And high oil prices enabled Venezuela to subsidize Nicaragua's domestic spending and fuel imports through the Petrocaribe alliance, giving Nicaraguan President Daniel Ortega more leeway in economic planning. Despite occasional bouts of political protest and confrontation between supporters of the government and the opposition, politically motivated violence has been relatively minimal. But with falling global oil prices and the subsequent decline of Venezuelan foreign assistance, Nicaragua's fortunes could soon change. More…