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Cablegate: Nicaragua: Private Sector Subdued On Elections

VZCZCXRO6053
RR RUEHLMC
DE RUEHMU #1409/01 3251954
ZNY CCCCC ZZH
R 201954Z NOV 08
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 3416
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHINGTON DC
RUEHLMC/MILLENNIUM CHALLENGE CORP WASHDC

C O N F I D E N T I A L SECTION 01 OF 02 MANAGUA 001409

SIPDIS

E.O. 12958: DECL: 11/20/2028
TAGS: ECON EINV PGOV PREL NU
SUBJECT: NICARAGUA: PRIVATE SECTOR SUBDUED ON ELECTIONS
CRISIS

REF: MANAGUA 1392

Classified By: Ambassador Robert J. Callahan, reasons 1.4 b and d.

Summary
-------
1. (C) When authorities announced preliminary municipal
election results on November 10, business leaders initially
called for a recount in Managua and other municipalities
where parties in opposition to the FSLN alleged electoral
fraud. Since then, the private sector has avoided a public
role in the ongoing political crisis. The president of one
prominent business association said it would be difficult to
take a political stand now, but he is looking forward to
maintaining private sector unity in anticipation of 2011
national elections. Meanwhile, he said maintaining channels
of communication with the government to protect members'
economic interests is his objective. One businessman
explained that business leaders fear government retaliation
if they publicly support the opposition. By taking
themselves out of the game, however, the private sector may
be inadvertently ensuring that, by 2011, it will be too late
to have any impact on elections. End summary.

Private Sector Calls for Review
-------------------------------
2. (C) When the Supreme Electoral Council (CSE) announced
preliminary municipal election results on November 10,
business leaders initially supported the political opposition
-- the "Vamos con Eduardo" - Constitutional Liberal Party
(PLC) alliance, Sandinista Reform Movement (MRS), and
Conservative Party (PC) -- in its call for a recount in
Managua and other municipalities where it alleged fraud
(reftel). In the days following the elections, the American
Chamber of Commerce (AmCham), the Federation of Nicaraguan
and Business Associations (COSEP), and several individual
chambers that are COSEP members issued formal declarations
warning that political instability caused by the elections
crisis would have a severe economic impact, and they called
for an open, transparent review of the election results.
Since, the private sector has avoided a public role in the
ongoing political crisis.

COSEP: Difficult to Take a Political Stand
-------------------------------------------
3. (C) On November 18, Jose Adan Aguerri, President of the
Federation of Nicaraguan Business Associations (COSEP), told
the Ambassador that it would be difficult for the private
sector to take a firm stand in support of any political party
in the ongoing elections crisis. Aguerri said that he has
worked to achieve unity within COSEP to deal with the Ortega
administration on business issues; taking a stand on
political issues would be even more difficult.

4. (C) Aguerri said it is his primary goal during the crisis
to ensure that the private sector "weathers the storm"
without significant losses in terms of sales or employment.
"COSEP must protect its members' interests," Aguerri
emphasized, "by maintaining an open channel of communication
with the government." COSEP is already looking toward
national elections in 2011. Keeping the private sector
united and strong will allow COSEP to play a constructive
role when it comes to electing a new president and
legislators, said Aguerri.

AmCham: Legal Process Must Run Its Course
-----------------------------------------
5. (C) American Chamber of Commerce of Nicaragua (AmCham)
President Cesar Zamora told Econoff on November 14 that
AmCham continues to press for a full recount of the November
9 municipal election results. He said that to be credible,
the recount must be subject to international observation.
When pushed on whether AmCham would step up its public
support for Montealegre, Zamora replied dryly that
Montealegre and other members of the opposition must make use
of the legal process available to contest the results. He
said AmCham did not want to interfere or get ahead of the
legal process, which should be allowed to run its course.
AmCham would wait to see how the process unfolds, he added.

Government Convinces Private Sector to Back Down
--------------------------------------------- ---
6. (C) Jorge Solis, Corporate Relations Manager for the
Nicaragua Brewing Company (Guatemalan and Costa Rican owned),
told Econoff on November 14 that President Ortega,s Economic

MANAGUA 00001409 002 OF 002


Advisor Bayardo Arce called him twice on November 10 to
discourage him from supporting a general strike that business
leaders had discussed for November 11. Solis reported that
Arce made similar calls to COSEP President Aguerri and other
business leaders to discourage support for Montealegre.

7. (C) Solis told us that a number of high-level FSLN
officials had participated in efforts discourage private
sector support for Montealegre. Rather than seek common
ground, as Arce does when he argues that political
instability will only hurt business, Attorney General Hernan
Estrada bullies and intimidates. First Lady Rosario Murillo
was concerned that a strike on November 11 would have quickly
solidified domestic and international opinion against FSLN
electoral fraud. Solis told us that Murillo became directly
involved in efforts to kill a strike and called Aguerri on
November 10 to lobby against it. Fearing government
retaliation, Aguerri felt he had no choice but to acquiesce
to her request.

Comment
-------
8. (C) COSEP continues to be cautious in its relations with
the Ortega administration. Its members have been subject to
tax audits, regulatory harrassment, accusations of criminal
wrongdoing, and assorted threats from government officials.
With assets at risk and responsibility for thousands of
employees and their families, it is not surprising for
members of the private sector to think twice about taking on
an increasingly autocratic government. By taking themselves
out of the game, however, the private sector may be
inadvertently ensuring that, by 2011, it will be too late to
have any impact on elections.
CALLAHAN

© Scoop Media

 
 
 
 
 
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