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Cablegate: Chinandeganos Concerned About Ortega, Opposition

VZCZCXRO2182
RR RUEHLMC
DE RUEHMU #1562/01 1721626
ZNY CCCCC ZZH
R 211626Z JUN 07
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC 0605
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHINGTON DC
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 001562

SIPDIS

SIPDIS

DEPT FOR WHA/CEN

E.O. 12958: DECL: 06/18/2017
TAGS: PGOV PINR ECON KDEM MCC NU
SUBJECT: CHINANDEGANOS CONCERNED ABOUT ORTEGA, OPPOSITION
DISUNITY


Classified By: CDA Peter Brennan for reasons 1.4 (b and d)

1. (C) Summary: The politically active citizens of
Nicaragua's north-western department of Chinandega are
concerned about President Ortega's centralization of
government and attempts to establish local citizens'
councils. Members of the private sector note that economic
activity is generally decreasing in the department, despite
the presence of the Millennium Challenge Account (MCA). In
one specific instance, local Sandinista officials have more
aggressively pressured a local American investor over land
concessions since the elections. Leaders of the opposition
parties agree they must find a way to cooperate to prevent an
FSLN sweep of the 2008 municipal elections. End Summary.

2. (U) Acting polcouns and incoming Nicaragua Desk Officer
visited the north-western department of Chinandega from June
14-15. Officers met with political, business, and civil
society leaders to discuss the local economic and political
situation. In general, Chinandeganos seemed more optimistic
about the medium-term future of the country than their
Managua counterparts, but are still concerned about Ortega's
authoritarian tendencies, verbal attacks on the USG, and
making friends with international outcasts such as Iran and
North Korea.

Locals Suspicious of President's "Citizens' Councils"
- - - - - - - - - - - - - - - - - - - - - - - - - - -

3. (C) The consensus of opposition political and civil
society leaders in Chinandega is that the government's
"citizens' councils" are being established along the lines of
the Sandinista Defense Committees of the 1980s. They suspect
that only ideologically vetted citizens will be permitted to
serve on the councils, which will serve as intelligence
mechanisms for the government and create an alternative fount
of authority apart from the formal bureaucracy.

4. (C) MRS coordinator for Chinandega Jeronimo Navas
complained that the selection procedures for the councils in
Chinandega have been "secretive," and the councils plan to
branch out and organize constituent groups of students and
public servants. Local Movimiento por Nicaragua (MpN)
coordinator Juanave Cabrera explained that many Sandinistas
are unhappy with the councils as they feel that the councils
are usurping the authority of existing NGOs (largely
controlled by Sandinistas).

Economy Suffering from Vague Policies and Corruption
- - - - - - - - - - - - - - - - - - - - - - - - - - -

5. (C) Contacts commented that several economic sectors in
Chinandega are declining or holding steady, which they blamed
in part on uncertainty over the new governments commitment to
a free market economy. Chamber of Commerce vice president
Enrique Cardenas noted that active membership in the Chamber
has decreased from 120 to 69, and several members of the
Chamber's staff have recently emigrated. Etica y
Transparencia coordinator Jose Francisco confirmed that
emigration in general has increased, with El Salvador, Costa
Rica, Spain, and the U.S. as the primary recipients.

6. (C) The Chinandeganos gave a mixed analysis of the impact
of MCC projects on Chinandega to date. Cardenas commented
that MCC has had a "huge impact" through road building and
export promotion. Navas agreed that MCC has helped medium
and large producers, but encouraged more work with poor
campesinos. ALN departmental secretary Danilo Guerrero
agreed with Cardenas and commented that the Sandinista mayors
are "taking credit for everything" and "filtering the
benefits" of MCC projects, presumably favoring their
supporters. Cabrera advised us to heavily promote MCC
activities in the press, especially using radio spots that
can reach the rural population.

7. (C) American businessman Roberto Membreno, owner of Marina
Puesta del Sol, described to us his considerable investment
plans for his oceanfront property. Membreno explained,
however, that the local police and mayor have refused to
assist him with a group of campesinos that have claimed and
occupied portions of the property. He reported that a local
judge has joined forces with the "land invaders" to extort
money from him, a tactic that he has vowed to resist.
Membreno claimed that he met with Supreme Court president
Manuel Martinez and National Police chief Aminta Granera on
June 13 to enlist their support. If the problems are not
resolved at the national level, he stated, he will cancel his
expansion plans.

Political Parties Agree on Need for Unity
- - - - - - - - - - - - - - - - - - - - -

8. (C) Local opposition leaders agreed on the necessity to
join forces to oppose the FSLN in the 2008 municipal
elections. MRS director Navas explained that the FSLN mayors
(who control all but one of Chinandega's 13 municipalities)
are especially vindictive towards MRS members, who suffer
from higher taxes, slower services, and spurious legal
accusations -- persecution that has grown more brazen since
the elections. ALN and PLC leaders also agreed on the need
for opposition unity while continuing to downplay the
relevance of the competing party. Guerrero predicted that
the PLC is heading for a "crash" as Arnoldo Aleman's
leadership has been "demystified" by the PLC's defeat in the
elections. PLC director Alberto Jose Ubilla responded that
the PLC still has the strongest party structure, while the
ALN depends on Eduardo Montealegre for its (shaky) cohesion.

Comment
- - - -

9. (C) While President Ortega has repeatedly told investors
that their property will be respected, apparently Sandinistas
in Chinandega have not received the message. Membreno's
experiences are not unique to Chinandega, especially for
investors with coastal properties. Unless Ortega makes good
on his campaign promises to eliminate corruption and enforce
respect for private property, investors in the tourism sector
will view Nicaragua with increasing caution, to the detriment
of economic growth.
BRENNAN

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