From: rich@pencil.cs.missouri.edu (Rich Winkel)
Subject: NICARAGUA: STALLED U.S. AID HURTING ECONOMY
Followup-To: alt.activism.d
Originator: rich@pencil.cs.missouri.edu
Organization: PACH
Date: Tue, 1 Sep 1992 08:23:23 GMT

/** reg.nicaragua: 111.0 **/
** Topic: IPS: Stalled US Aid **
** Written 11:58 am  Aug 28, 1992 by hrcoord in cdp:reg.nicaragua **
From: Human Rights Coordinator <hrcoord>
Subject: IPS: Stalled US Aid

/* Written 12:09 am  Aug 28, 1992 by newsdesk in cdp:ips.englibrary */
Copyright Inter Press Service 1992, all rights reserved.  Permission to re-
print within 7 days of original date only with permission from 'newsdesk'.

Title: NICARAGUA: STALLED U.S. AID HURTING FRAGILE ECONOMY

managua, aug 25 (ips) -- the withholding of over 100 million
dollars in u.s. aid has begun to affect the nicaraguan economy,
the president of the country's central bank announced tuesday.

so far, the government has been able to compensate for the
crisis by obtaining stop-gap credits and using funds programmed
for the final trimester of 1992, silvio de franco said.

de franco said that nicaragua was pressing for the release of
the funds, frozen since may, and added that the government ''is
preparing legal and administrative policies to prevent any future
delays'' in the aid process.

the 104 million dollars was frozen by a group of u.s.
congressmen, led by conservative senator jesse helms, who are
demanding the return of land confiscated from u.s. citizens
following the 1979 sandinista revolution.

the congressmen also object to continued sandinista influence
in the government, army and police force.

in response, the government of president violeta chamorro has
promised to address all land ownership claims and has announced a
shake-up in the police force set to take effect on september 5.

the president of the central bank said the aid is needed ''to
pay debts owed international organisms,'' including the
international monetary fund (imf) and world bank.

''the aid is a determininant factor in maintaining our
economic rhythm,'' he said.

de franco said he hopes the aid will be released in september,
adding that the delay has already generated economic problems.

the official pointed to the rise in exchange rate for the
dollar at money exchange offices and on the street.

while the government banks have maintained the official five
to one exchange rate, on the open market the rate has reached as
high as 5.5 cordobas to the dollar.

''speculation, provoked by the uncertainty over the u.s. aid,
is controlling the price of the dollar,'' he said.

de franco said, however, that the government had no intention
of adjusting the official rate, as it would lead to inflation.

reducing nicaragua's rampant inflation is one of the current
government's proudest achievements. chamorro's administration was
able to reduce inflation to 4.8 percent in the first six months
of 1992, from an annual rate of 13,000 percent in 1990.
(more/ips)
----


nicaragua: stalled (2)

for the moment, nicaragua has been able to supplement the
stalled aid with a recently authorised loan of 55 million dollars
from the interamerican development bank (idb).

in addition, the central american bank for economic
integration is supporting economic rehabilitation, with loans to
the industrial and agricultural sectors aimed at promoting the
production of non-traditional products.

however, de franco said that credits authorised by
international organisms often ''are not used to their potential''
because of insufficient infrastructure and a lack of efficiency.
(enr/ips/sp/trd/nz/cs/eli/92)
----


** End of text from cdp:reg.nicaragua **
Newsgroups: misc.activism.progressive