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Cablegate: Remote Rio San Juan has Much Undeveloped Potential

VZCZCXYZ0006
RR RUEHWEB

DE RUEHMU #1552/01 1951949
ZNR UUUUU ZZH
R 141949Z JUL 06
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 6980
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEHRO/AMEMBASSY ROME 0092

UNCLAS MANAGUA 001552

SIPDIS

SENSITIVE
SIPDIS

DEPT FOR WHA/CEN

E.O. 12958: N/A
TAGS: ECON EAID PGOV SOCI NU
SUBJECT: REMOTE RIO SAN JUAN HAS MUCH UNDEVELOPED POTENTIAL

REF: MANAGUA 1400

1. (U) Summary: During a June 21 to 23 trip to the remote
Nicaraguan department of Rio San Juan, poloff and political
specialist met with political, business, and religious
leaders to discuss economic and social conditions in the
area. We learned that the economy is largely based on the
exploitation of natural resources, with small but growing
tourism and craft industries. As with most areas in the
Central and Atlantic Coast regions, the department suffers
from a lack of transportation infrastructure and utilities.
Many Nicaraguans emigrate from and through Rio San Juan to
Costa Rica for better wages and employment opportunities. We
also visited the Solentiname archipelago, whose residents
developed an art and handicrafts industry in the late 1970s
and 1980s under the tutelage of Sandinista activist and (now
ex-) priest Ernesto Cardenal. End Summary.

2. (U) The largely rural department of Rio San Juan's
population is about 96,000 -- the fewest inhabitants of any
Nicaraguan department or region. The economy of Rio San Juan
is based on fishing, ranching and milk cows, lumber, tourism
and handicrafts. The senior Catholic priest in the
Department, Father Luis Zavala, characterized the population
as 10 percent middle class and 90 percent lower class. Most
agricultural producers in Rio San Juan operate on a small
scale, largely subsistence farming, and are unable to obtain
commercial loans to increase their holdings.

3. (U) Economic development is stymied by a generalized lack
of utilities and transportation infrastructure. Power
failures for up to three days are routine. The "highway"
from Juigalpa to San Carlos is a potholed disaster -- a bus
ride to Managua takes six to eight hours. The San Carlos
airstrip is a dirt track with no security features, not even
a fence. (The daily flight from Managua must often circle
the runway to check for grazing livestock.) A ferry from
Granada arrives in San Carlos two days a week, but the
journey across the lake to central Nicaragua also requires
several hours. El Almendro mayor Ufredo Arguello explained
that Rio San Juan producers are not competitive with others
in Nicaragua because of the small scale of their holdings and
high transportation costs.

LUMBER INDUSTRY: "DAMAGE ALREADY DONE"
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4. (SBU) According to Father Pablo Alexis, lumber is an
important economic activity in the municipality of El
Castillo; however, independent lumberjacks only receive about
30-50 cordobas (US$1.70-$2.85) per tree for lumber that is
worth hundreds of dollars when processed. Ufredo Arguello
complained that the heavy trucks used to remove the timber
have further degraded roads in the Department. He stated
that the current GON prohibition on lumber exports was
instated "too late" -- "the damage has already been done."

FISHING EMPLOYS LARGE PERCENTAGE OF WORKFORCE
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5. (U) Martin Aguilar Bendana, President of the Rio San Juan
Fisherman's Association, explained to us that Rio San Juan
has a "great potential for export of fish" but lacks the
necessary infrastructure to develop the industry. The
Association represents three cooperatives and is trying to
obtain legal recognition ("personeria juridica"), but cannot
pay for a lawyer in Managua to process the paperwork.

6. (U) According to Bendana, the fishing industry employs
3,000 people in the Department, all of whom use "traditional
methods" to fish. The fishermen are trained to only take
adult fish of a certain size to preserve the stocks.
Apprentices are at least 16 years old (though Bendana
admitted that the law specifies a minimum age of 18 years).
The average fisherman can earn 600-700 cordobas per day
(US$34-$40) gross, but can usually only fish for three days a
week due to lack of supplies. The catch is shipped to
Managua and points abroad via ice-packed coolers.

7. (SBU) Despite the importance of the fishing industry,
Bendana complained that neither the GON nor the international
community has provided assistance to improve conditions.
Apparently the Italian Association for Rural Cooperation in
Africa and Latin America (ACRA) allocated 300,000 euros to
build a modern processing plant in the Department, but the
project was never completed.

MANY IN RIO SAN JUAN DEPEND ON COSTA RICA FOR JOBS, SERVICES
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8. (SBU) Migration from and through Rio San Juan to Costa
Rica is considerable. Father Alexis noted that many
Nicaraguans leave the Department during the Costa Rican
harvest season from November to March. He claimed that the
Costa Ricans have instituted a policy of deporting
Nicaraguans far from their zone of entry to try to avoid
immediate returns (for example, a Nicaraguan who entered
through the Department of Rivas in western Nicaragua would be
deported to Rio San Juan). Father Zavala stated that
families use remittances from the migrant workers "to
survive, not buy luxuries." Ufredo Arguello complained that
"the best workers go to Costa Rica" for wages three to four
times greater than what they could expect in Nicaragua.

9. (U) The residents living in the remote area of Rio San
Juan lying south of Lake Nicaragua between the Rio Frio and
the border of Rivas department must depend on Costa Rica for
basic services. The common currency in this area is the
Costa Rican colon, the children attend school in Costa Rica,
and the citizens receive medical care from Costa Rican
clinics. San Miguel mayor Carlos Fletes told us that the
children in this area know the Costa Rican anthem by heart,
but are ignorant of Nicaragua -- "it is a disgrace," he
lamented.

SOLENTINAME: A UNIQUE LOCALE
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10. (U) The archipelago of Solentiname, part of the
Department of Rio San Juan, is located in the southern part
of Lake Nicaragua, about a one-hour boat ride from the port
of San Carlos. The population of approximately 1,000 lives
primarily on the three largest islands: Mancarron, San
Fernando, and Isla Venado (Deer Island). Solentiname's
economy is based on fishing, subsistence agriculture,
handicrafts, and tourism. Most families rely on multiple
sources of food and income, with one adult dedicated to
fishing and another to painting, for instance. The school
age population is served by several primary schools and a
secondary school on Mancarron.

11. (U) Like the rest of Rio San Juan, the development of all
industries on Solentiname is hampered by a lack of
infrastructure and transportation links. All electricity
comes from solar or diesel powered generators. Those who can
afford the service use Costa Rican cell phones (Nicaraguan
service providers only have a signal at the highest points of
San Fernando and Mancarron) and must pay international
charges to communicate with clients in Managua. A public
ferry services the islands only three days a week from San
Carlos, and private "lanchas" charge US$120 for a round-trip
visit to the islands.

12. (SBU) Unlike most of the rural population in Rio San
Juan, whose loyalty is with the Liberal parties (reftel), the
people of Solentiname sympathize with the FSLN and regard
priest, poet, and FSLN activist Ernesto Cardenal as virtually
their patron saint. Island native and owner of the
Solentiname Guesthouse Maria Guevara Silva spoke reverently
of Cardenal, dividing Solentiname's history into two eras:
pre-Ernesto (before 1975) and post-Ernesto. According to
Guevara, Cardenal spearheaded literacy and environmental
awareness campaigns in the islands. He taught people how to
paint their surroundings in the now-famous "primitivist"
style. Cardenal gave the islanders a "reason to live" and a
"sense of community," explained Guevara. According to her,
Cardenal still visits Solentiname frequently, and we
witnessed on Mancarron a village constructed to house
pilgrims visiting Cardenal. The village contains a giant,
incongruous red and black iron monument to the FSLN, as well
as a "library" displaying indigenous artifacts, international
awards given to Cardenal, portraits of FSLN revolutionary
leaders, moldering stacks of socialist literature, and the
Harry Potter series translated into Spanish. The Hotel
Mancarron, one of the oldest and largest in the archipelago,
is currently closed due to a legal dispute between German
investors and local Cardenal supporters.

13. (U) International groups have supported the construction
of two artists cooperatives in Solentiname -- one in
Mancarron and the other in San Fernando. The San Fernando
cooperative, with over 50 members, is sponsored by the
"Massachusetts Friends of Solentiname" and takes a 20 percent
commission on all artwork sold to sustain itself. The best
"primitivist" artists are able to charge several hundred
dollars for their work -- a fortune in the islands. ACRA has
constructed a museum on San Fernando that illustrates the
islands' history and natural resources.
TRIVELLI

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