Cablegate: Continuation of Tps for Nicaragua

VZCZCXYZ0003
PP RUEHWEB

DE RUEHMU #1031 2922152
ZNR UUUUU ZZH
P 192152Z OCT 09
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC PRIORITY 4671
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE PRIORITY

UNCLAS MANAGUA 001031

SIPDIS

STATE FOR PRM/PIM AND WHA/CEN

E.O. 12958: N/A
TAGS: PHUM PREF SMIG NU
SUBJECT: CONTINUATION OF TPS FOR NICARAGUA

REF: A. STATE 101826
B. MANAGUA 1009
C. 08 MANAGUA 1392
D. 08 MANAGUA 1329
E. 08 MANAGUA 767

1. (SBU) Summary: Per ref A, following is Embassy Managua's
assessment of Nicaragua's current conditions and ability to
reabsorb the roughly 4,000 Nicaraguans granted Temporary
Protective Status (TPS) after Hurricane Mitch in 1998.
Nicaragua has yet to fully recover from Hurricane Mitch, and
the country's political, economic, and social circumstances
do not provide an environment in which the return of
nationals could be adequately handled. End Summary.

2. (SBU) In general, Nicaragua has never fully recovered
from Hurricane Mitch in 1998. The regions most devastated
by Mitch, the mountainous north and isolated Atlantic coast,
continue to be the poorest and least developed in the
country. In 2007, the Atlantic coast suffered an additional
blow from Hurricane Felix; a year later the recovery remains
minimal (ref D). Other climatic events have also devastated
the northern mountainous region and western part of the
country since 1998 (ref B, E). These events have contributed
to an environment in which there are continual disruptions to
living conditions.

3. (SBU) Weak and poorly constructed infrastructure in the
affected areas continues to be a significant barrier to
wide-scale recovery. Many roads are unpaved and become
impassable with heavy rains and floods. The Millennium
Challenge Corporation (MCC) funded road projects in some of
the more populous areas effected by Hurricane Mitch, but
rural feeder roads remain in poor conditions. Moreover, as a
result of the 2008 electoral fraud (ref C), MCC has partially
terminated its compact with Nicaragua, further limiting
resources available for the country's infrastructure. Most
rural roads in the northern mountainous region and the
Atlantic coast have not been properly rehabilitated since
Hurricane Mitch. Roads are usually repaired superficially
during the dry season, but become impassable during the rainy
season.

4. (SBU) Political tension throughout the country also has
contributed to the disruption in living conditions. The
Government of Nicaragua's attempt to consolidate power is the
root of tension, and was most visible in the 2008 municipal
electoral fraud. In the Atlantic coast, an area most
devastated by Mitch, the political tension has contributed to
calls for regional independence from local leaders.

5. (SBU) The country's increasingly poor economy has slowed
down reconstruction efforts, inhibiting the Government of
Nicaragua from reabsorbing additional people. Nicaragua is
the second poorest country in the Western Hemisphere.
Official unemployment was 4.9% in 2007, but 60% of all
workers earn a living in the informal sector, where
underemployment is extremely high. The Central Bank
forecasts a GDP contraction of 1% in 2009, but independent
economists believe the economy might contract as much as
3.5%. European donors' decision to cut off budget support in
the wake of fraudulent municipal elections has exacerbated
fiscal woes caused by a decline in tax revenue as a result of
the economic slowdown. In a recent public opinion poll, 59%
of the population expressed a desire to leave the country.
Of these, 91% seek better employment or a better economic
situation.

6. (SBU) Given the current political, economic, and social
circumstances facing Nicaragua, combined with the
disaster-prone climate/geography, Nicaragua is currently
unable to reabsorb the 4,000 Nicaraguans currently benefiting
from TPS. For this reason, post recommends an extension of
the current designation of TPS for Nicaraguan nationals.
CALLAHAN

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