San José, Costa Rica, since 1956

State of Nation Report Devoid of Analysis

Unable to present his annual State of the Nation address before the National Assembly on Jan. 10 as required by law, President Daniel Ortega instead emailed the enormous document to lawmakers and the press last week in an effort to comply with the constitutional mandate.

National Assembly lawmakers, who were still bickering earlier this month and unable to convene the day that Ortega was scheduled to give his address, were punished for their truancy by waking up Jan. 11 to find Ortega s entire 464-page State of the Nation report, complete with a 145-page social perspective appendix, crammed into their e-mail in-boxes.

By comparison, former President Enrique Bolaños final State of the Nation address in 2006 was a more manageable 6 pages long.

The few lawmakers who actually opened Ortega s email noticed two things right away. First, the report was apparently prepared by Ortega s private secretary for political affairs, U.S. citizen Paul Oquist, who signed off on the cover letter.

And secondly, the entire first section of the report read more like an academic lecture on the state of global capitalism rather than any attempt to analyze Nicaraguan affairs in 2008.

Nicaragua, in fact, was barely mentioned in the first 40 pages of the report, which focused entirely on Wall Street s financial crisis. The economic analysis is so loaded with Wall Street financial terminology Collaterized Debt Obligation, Credit Default Swaps and Exchange Traded Funds that many of the terms didn t even translate into Spanish, let alone Nicaragua s economic realty.

Despite the sloggy introduction, the focus on the global financial crisis served two greater causes in Ortega s report: first, it helped the Sandinista government to blame Nicaragua s problems on external factors; and secondly, it justified Ortega s call for a new model to replace the capitalist, neoliberal model, which the government report calls immoral.

The Government of Reconciliation and National Unity came to power Jan. 10, 2007 with a proposal to replace the socio-economic model of neoliberal, global capitalism with an equitable development model of Citizen Power, Ortega s State of the Nation report reads. It wasn t necessary for the system to collapse to know neoliberalism s harmful affects on development and poor people. Sixteen years of neoliberal government policies in Nicaragua demonstrated that this socio-economic model was not conducive to development or poverty reduction.

On the contrary, it concentrated wealth and income.

The State of the Nation report went on to laud the Bolivarian Alternative for Our Americas (ALBA), the Venezuelan-propped socialist cooperation agreement that forms the cornerstone of Ortega s alternative model for Nicaragua.

ALBA recognizes the asymmetries between the levels of development in different countries and produces complements and compensations to achieve a development whose top priority is the union of Latin America and the Caribbean to overcome poverty in the name of solidarity and equality, the report reads.

The Sandinista government also provided some concrete examples of how ALBA helped Nicaragua survive a difficult year in 2008, especially in terms of cooperation in energy and oil.

The report noted that Nicaragua, which two years ago was facing a massive energy shortage, in 2008 increased its energy output thanks to Venezuelan aid by 120 megawatts, and this year is scheduled to increase by an additional 160 megawatts of power.

The government also said favorable terms of payment for Venezuelan oil saved Nicaragua $375 million in expenses last year and allowed the government to maintain transportation subsidies from May through December.

ALBA is already a reality as a regional economy and has allowed Nicaragua to avoid the volatility of prices due to speculation of neoliberal global capital finance in 2007-2008, the report reads.

Ortega s report also notes that its alternative food-distribution network has benefited 270,000 poor families across Nicaragua. Managed by state food bank ENABAS and the controversial Councils of Citizen Power (CPCs), the program sells rice, beans, corn, and cooking oil in some 2,700 neighborhood stores across the country.

The opposition, however, complains the CPC-managed neighborhood markets use state resources to benefit only Sandinista supporters, while denying other poor people similar discounts.

Some of the claims made in the report  are slightly more dubious, such as listingthe Venezuelan oil refinery with the capacity for 150,000 barrels a day as an example of the solidarity under ALBA. To date, the refinery has not been built and the project has been put on hold while Venezuela revises the financing.

Another questionable achievement listed in the government report is Nicaragua s official recognition of the breakaway Georgian republics of Abjasia and South Ossetia a decision that drew some heat from the United States and other countries. Nicaragua was the only country in the world other than Russia to recognize those republics.

Some of the numbers presented by the government are also questionable, such as the claim that unemployment dropped for the second consecutive year, to 6.1 percent in 2008, at a time when the private sector is reporting the loss of some 19,000 jobs in the textile sector.

For the most part, however, the content of Ortega s 2008 State of the Nation report which dedicates some 400 pages to listing all its accomplishments without any meaningful impact analysis remains mostly unknown outside of the circle of people who wrote it.

The Nica Times this week tried to get reaction from several lawmakers from various opposition political parties, as well as independent analysts, but nobody was familiar with the report.

Lawmaker Enrique Sáenz, head of the Sandinista Renovation Movement (MRS), said his party still hadn t had a chance to review the hefty document. Enrique Quinoñez, of the Liberal Constitutional Party (PLC), admitted he hasn t read it. And independent lawmaker Jamileth Bonilla said she was trying to print it out, but hadn t yet had a chance to look at that book.

Even veteran policy analysts were baffled when asked to opine on the State of the Nation report.

I haven t even heard about it. Where can I find it? Can you send it to me? said analyst Cirilo Otero.

This shows how difficult it is and how little information is available from this government in all areas: electoral, economic, health and education, the analyst added.n

Selected Accomplishments From 2008 State of Nation


Illiteracy has dropped from 35% in January 2007, to 7.5% at end of 2008. Goal is to eradicate illiteracy by July 19, 2009.

School dropout rate has dropped from 13% in 2006, to 6% in 2008, and enrollment is up 13%.


Consultations, which are now free, were up 34% in 2007 and 11% in 2008.

Access to prescription drugs increased 50% in 2007 and 27.7% in 2008.

Water and Sewage

Access to drinking water in urban areas has increased from 65% in 2006, to 77% in 2008.


1,276 new houses built in 2008.

Social Security

6,987 new employers are paying into the social security system, covering 156.154 new workers in 2008.

Family, Youth

15,912 children reintegrated into their biological homes, or substitute homes or temporary shelters.

2,500 youth living on the street were trained to work and encouraged to study; 1,125 youth reinserted into schools.


Reforested 22,079 hectares of land.


Economy grew 3.2% in 2008, and exports reached $1.5 billion, up 25% from 2007. Free trade exports were $1.2 billion, up 10% from 2007.

International reserves up 2% in 2008 to $1.12 billion.

Bank deposits up 7% to $49 billion.

Tax collection up 17% to $750 million in 2008.

Customs up 16% to $407 million.

Social Programs

Gov t expenses on social spending, poverty reduction increased 20.8% (for health, education, energy, water, etc.).

140,010 producers benefited from 82,625 quintales of seeds, up 48% from last year.

19,709 families benefited from Zero Hunger program, up 56% from the year before.

20,174 women trained, up 854% from 2007, 29% of women received credit to start businesses under USURA-Zero.


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