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NICARAGUA’S DEMOCRATIC COLLAPSE

HEARING

BEFORE THE

SUBCOMMITTEE ON 

THE WESTERN HEMISPHERE

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED FOURTEENTH CONGRESS

SECOND SESSION

SEPTEMBER 15, 2016

Serial No. 114–235

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

MATT SALMON, Arizona 

DARRELL E. ISSA, California 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

PAUL COOK, California 

RANDY K. WEBER SR., Texas 

SCOTT PERRY, Pennsylvania 

RON DESANTIS, Florida 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

CURT CLAWSON, Florida 

SCOTT DESJARLAIS, Tennessee 

REID J. RIBBLE, Wisconsin 

DAVID A. TROTT, Michigan 

LEE M. ZELDIN, New York 

DANIEL DONOVAN, New York 

ELIOT L. ENGEL, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

BRIAN HIGGINS, New York 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

ALAN GRAYSON, Florida 

AMI BERA, California 

ALAN S. LOWENTHAL, California 

GRACE MENG, New York 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

BRENDAN F. BOYLE, Pennsylvania

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

SUBCOMMITTEE ON THE WESTERN HEMISPHERE

JEFF DUNCAN, South Carolina, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

MICHAEL T. MCCAUL, Texas 

MATT SALMON, Arizona 

RON DESANTIS, Florida 

TED S. YOHO, Florida 

DANIEL DONOVAN, New York 

ALBIO SIRES, New Jersey 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

GREGORY W. MEEKS, New York 

ALAN GRAYSON, Florida 

ALAN S. LOWENTHAL, California 

(III)

C O N T E N T S 

Page

WITNESSES 

Mr. Juan Gonzalez, Deputy Assistant Secretary, Bureau of Western Hemisphere Affairs, U.S. Department of State .......................................................... 6

The Honorable Marcela Escobari, Assistant Administrator, Bureau for Latin 

America and the Caribbean, U.S. Agency for International Development ..... 13

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Mr. Juan Gonzalez: Prepared statement ............................................................... 9

The Honorable Marcela Escobari: Prepared statement ........................................ 15

APPENDIX 

Hearing notice .......................................................................................................... 32

Hearing minutes ...................................................................................................... 33

The Honorable Jeff Duncan, a Representative in Congress from the State 

of South Carolina, and chairman, Subcommittee on the Western Hemisphere: Material submitted for the record ......................................................... 34

(1)

NICARAGUA’S DEMOCRATIC COLLAPSE 

THURSDAY, SEPTEMBER 15, 2016

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON THE WESTERN HEMISPHERE,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The committee met, pursuant to notice, at 10:00 a.m., in room 

2172 Rayburn House Office Building, Hon. Jeff Duncan (chairman 

of the subcommittee) presiding. 

Mr. DUNCAN. A quorum being present, the subcommittee will 

come to order. I would now like to recognize myself for an opening 

statement on the hearing Nicaragua’s Democratic Collapse. 

We meet today to register our deep concern over the collapse of 

democracy in Nicaragua and conduct oversight of the Obama administration’s priorities in the country, in view of U.S. interests 

and recent events. 

While Nicaragua does not suffer the same problems with citizen 

security, gang wars, or migration to the United States as the 

Northern Triangle countries have experienced, it is the poorest 

Central American country and second poorest in the Western 

Hemisphere, only after Haiti. 

Under President Ortega’s multiple terms as President, he has 

taken increasingly blatant steps to concentrate political power into 

a single party FSLN-ruled system controlling the majority at executive, legislative, judicial, and electoral branches of government. In 

2011, 2012, 2014 elections, the State Department and other observers found fraud and other major irregularities had occurred. Since 

then, the State Department has documented in several reports that 

Nicaraguan Government agents have committed arbitrary or unlawful killings, used excessive force and torture in prisons, and limited the Nicaraguan people’s freedom of speech, religion, and the 

press. 

Compounding these problems, in 2014 the FSLN-dominated National Assembly passed 97 constitutional amendments and Ortega 

pushed through a new military code and reform of the National Police, giving Ortega more political control over the country. Ortega 

also appointed his sons and daughters positions of Ambassador, 

Presidential advisor, and his wife holds the post of communication 

minister, government spokesperson and now is a Vice Presidential 

pick ahead of the November 6 elections, even though Nicaragua’s 

Constitution bars those related to the President from being a candidate for Vice President. 

2

In June, the Supreme Court stripped the opposition Independent 

Liberal Party, PLI, and the Citizen Action Party, PAC, of their chosen leaders. 

In July, the Supreme Electoral Council removed 28 PLI National 

Assembly members from their democratically elected positions. Ortega has even announced that no international election observers 

will be allowed for the November election, despite the wishes of the 

Nicaraguan civil society. Such an erosion of democracy and freedom 

and utter disregard for the rule of law and human rights should 

elicit cries of outrage from democratic countries in Latin America, 

and the Caribbean, and from the Obama administration. Yet, while 

a few countries have made statements and the OAS, Organization 

of American States, and Human Rights Foundation have expressed 

concerns, nothing more has happened. 

Today, there appears to be no cost to Ortega for undermining democracy and the rule of law in the pursuit of his own personal interests. 

The United States has national interests at stake in Nicaragua 

and Central America. Nicaragua is a member of the Central American Free Trade Agreement, CAFTA-DR, thus, benefitting from access to U.S. markets. There are multiple U.S. businesses operating 

in the country, 177 Peace Corps volunteers reflecting the U.S. spirit of compassion, and many U.S. citizens have chosen to retire 

there. 

Strategically, Nicaragua occupies the geographic center of Central America and is, therefore, key not only for legitimate commerce but also for drugs, contraband goods, migrant flows, and potential security challenges to the Northern Hemisphere. That said, 

we want to see a stable, prosperous Nicaragua that adheres to 

democratic principles, respects the rule of law and separation of 

powers, supports human rights, and responds to the will of the Nicaraguan people. We want to see that Nicaragua and all Central 

America achieve greater security and economic growth, limit migration north to the United States, and minimize the strategic influence of actors like China, Russia, and Iran from establishing a 

greater presence in the region. Unfortunately, under Ortega’s tenure just the opposite is occurring. 

Furthermore, Ortega has displayed clear contempt for the common accepted principles of government-to-government relations 

with the United States through the expulsion of three U.S. citizens 

traveling on official U.S. business in June from the country. This 

follows the expulsion of Freedom House’s Latin American programs 

director and students from Mexico National Autonomous University earlier this year. 

Ortega has also continued to pursue deeper relations with China 

through the Inter-Oceanic Canal Project, even though there appears to be limited progress on this canal and tremendous public 

opposition to his construction, Ortega has given the Hong Kongbased company HKND enormous discretion in building and operating the canal. Moreover, Russia has also been building stronger 

military ties to Nicaragua. Russia recently sold 50 T-72 tanks to 

Nicaragua, established and is expanding a large law enforcement 

training center in Managua, and gained access to Nicaragua’s air 

space and ports. 

3

Iran has also continued courting Nicaragua, sporadically pursuing interest in Nicaraguan ports during the last decade, a strong 

diplomatic presence, and student exchanges with Iranian religious 

schools. Iran’s continuing interest in Nicaragua was highlighted by 

a visit last month by Iranian Foreign Minister Zarif, where Zarif 

expressed interest in collaborating with Nicaragua on the InterOceanic Canal and extending economic energy and trade ties. 

So, given the U.S. interest in Asia, the Middle East, and Europe, 

I am left wondering what the Obama administration is doing to understand and respond to the strategic implications of these countries’ overtures to Nicaragua and to reassure our friends in the region, such as Costa Rica and Colombia, that we have particular 

concerns with Nicaragua’s expanding military relationship with 

Russia. 

The State Department’s fiscal year 2017 budget requests in- cluded over $14 million for Nicaragua. Although I support providing assistance to promote U.S. interests, given the current landscape in Nicaragua, I am deeply skeptical as to the effectiveness 

of the administration’s priorities and efforts in the country. After 

all, the situation looks very bleak ahead of the November elections. 

If Ortega continues with his current activities, perhaps instead 

it is a time for the administration to consider a re-think of its constructive engagement policy toward Nicaragua. To that end, what 

has the current U.S. policy achieved? Is Nicaragua more or less 

democratic? To what degree has the administration’s policy help 

dissuade Nicaragua from pursuing partnerships with countries like 

Iran and Russia that potentially threaten U.S. interest in the region? If things do not change before the election, I believe the State 

Department should very strongly consider sanctions denying Nicaragua the benefits of CAFTA-DR and work with the Treasury Department to vote against loans in the international lending institutions until the Government of Nicaragua takes steps to respect 

freedom, fair and open elections, democracy, and the rule of law. 

So with that, I will turn to the ranking member for his opening 

statement. 

Mr. SIRES. Thank you, Mr. Chairman, for holding this hearing 

and thank you to our witnesses who have joined us here today. 

Since winning the presidency a decade ago, Daniel Ortega has 

pursued a goal of gaining absolute political control over Nicaraguan 

society. With the November 6th Presidential election in Nicaragua 

approaching, and with his control over all the nation’s public institutions, Ortega is poised to win his third consecutive term, this 

time with his wife serving as his running mate. 

How has Ortega been able to concentrate his power? Not satisfied with simply winning an election widely deemed fraudulent in 

2006 and 2011, as President, Ortega has used his influence to gain 

control over the courts, rescind Presidential term limits, disqualify 

opposition leaders from running for office, remove opposition lawmakers from the National Assembly, and ban international election 

observers from the country. 

The opposition party including the largest, PLI, Independent Liberal Party, are fractured and in no position to effectively confront 

Ortega’s overwhelming political power and influence. Both the 

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cerns over Ortega’s blatant, undemocratic power grab, as well as 

his expulsion of the opposition legislators and U.S. citizens. 

Earlier this year, Ortega’s Government needlessly expelled an 

American scholar from the American War College doing research 

on the supposed Nicaragua Canal. Additionally, they have also expelled two U.S. Embassy officials without cause and routinely harassed American visitors traveling down to Nicaragua. 

Congress and the administration need to work together and find 

ways to empower the Nicaraguan people and counteract Ortega’s 

hostile behavior toward innocent civilians. That is why I was proud 

to work with my good friend from Florida, Congresswoman RosLehtinen and our Chairman Duncan, among several other colleagues from both sides of the aisle to introduce and pass H.R. 

5708, the Nicaragua Investment Conditionality Act, NICA. 

H.R. 5708 calls on the U.S. Government to oppose loans at international financial institutions for Nicaragua, unless the Nicaraguan Government takes effective steps to hold free, fair, and 

transparent elections and commits to upholding democratic principle. It is my hope that this legislation will pass the Senate and 

quickly be signed into law by President Obama. 

I look forward to hearing from our witnesses their points of view 

regarding the current situation in Nicaragua and how the U.S. and 

the international community can effectively respond to the nondemocratic actions of Daniel Ortega. 

Thank you. 

Mr. DUNCAN. The Chairman will now recognize the former chairwoman of the full committee and now chairwoman of the Subcommittee on Africa and the Middle East—or Middle East and 

North Africa, I guess is what is called. Isn’t that right? 

Ms. ROS-LEHTINEN. I will take that. 

Mr. DUNCAN. You are recognized for 5 minutes. 

Ms. ROS-LEHTINEN. Thank you, Mr. Chairman. And that beard 

looks pretty sexy on you. 

Mr. DUNCAN. Well, thank you. 

Ms. ROS-LEHTINEN. I like it. 

Thank you for holding this hearing, Mr. Chairman. I think it is 

so important for your subcommittee to shine a spotlight on Nicaragua and the abusive actions orchestrated by Daniel Ortega and 

his decrepit regime. You have described them. The ranking member Albio Sires, has described them. We all know it. 

And on December 1, 2011, when I was chair of the Foreign Affairs Committee, I held a hearing on elections in Nicaragua. And 

now here we are, 5 years later, nada has changed. 

In February 2016, Ortega detained and expelled Freedom House 

Latin America Director Dr. Carlos Ponce. And in June 2016, Ortega expelled three United States Government officials. 

Ortega has also forced the Nicaraguan Supreme Court to not recognize the leaders of two opposition political parties. He has even 

removed 28 opposition deputies and alternates from the National 

Assembly without any due process and in the most undemocratic 

way possible. Then, he chose his wife to be his running mate in the 

upcoming illegitimate elections in an effort to extend the Ortega 

dynasty at the expense of the people. 

5

We have seen Ortega send his cronies to break up peaceful 

marches by Nicaraguan civil society and peaceful protestors who 

are simply calling for inclusive elections to be observed by international and domestic experts. 

If these problems sound familiar to you, Mr. Chairman, it is because we have seen these deplorable acts in the Western Hemisphere just a bit too often. Ortega has taken a page out of the 

Maduro and Castro playbook on how to silence the opposition and 

maintain a grip on power. And while the failed policies toward 

Cuba and Venezuela tend to grab the headlines, we cannot forget 

about the other rogue regimes in the region like Nicaragua that 

subvert democratic principles. 

What is it going to take for us to take action? Russian tanks are 

in Nicaragua. What do we think they are going to be used for? Of 

course, it is going to be scare and intimidate the public, just like 

the National Police and the military is being used by Ortega to 

abuse the people and violate their human rights, as we speak. We 

cannot give Ortega a free pass on these actions. 

I know that State Department officials will say that at least 

Nicaragua is cooperating with the U.S. on counter-narcotics operations, but the truth is cooperation is very limited and it is designed to detract our attention away from its bad actions. These 

rogue regimes in the region know how to play us like a violin. Bad 

actors in the region understand that as long as they can cooperate, 

even under a limited basis with U.S. authorities on counter-narcotics, then we typically turn the other way when it comes to democracy and human rights. This charade must not be allowed to 

continue. We have got to start holding Ortega and his ilk accountable. 

And thank you, Mr. Chairman, for the markup earlier. I am honored to be the Republican lead, alongside my good friend Debbie 

Wasserman Schultz, in introducing H.R. 851. Thank you for its 

passage. This resolution, as you pointed out, expresses the profound concern of Congress about the ongoing political, economic, social, and humanitarian crisis in Venezuela. It calls for the release 

of all political prisoners, for Venezuelan officials to respect constitutional and democratic process. As we know, the economic situation continues to deteriorate. Inflation has caused high food 

prices, making it difficult for people to afford even the most basic 

necessities. 

Also, Maduro continues to unjustly detain Venezuelan political 

prisoners from the opposition. The regime is even extrajudicially 

holding American citizens. 

So, I think you for the markup on that resolution and I thank 

you for the markup for supporting the Nicaraguan Investment Conditionality Act, a bill that I am proud to have introduced with the 

ranking member of your subcommittee, Mr. Sires, as well as the 

chairman of our subcommittee, Mr. Duncan. 

Taking his cues from Ortega and seeing the tepid response from 

the international community, Ortega has ignored the Nicaraguan 

Constitution, manipulated the nation’s Supreme Court and its 

Electoral Council to empower his regime and silence his opposition. 

So, I thank you for the markup and the passage of this resolution 

to say that they have got to hold free, fair, and transparent elecVerDate 0ct 09 2002 13:34 Nov 22, 2016 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 F:\WORK\_WH\091516\21546 SHIRL
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tions, promote democracy, strengthen the rule of law, respect the 

right of freedom of association or they don’t get these loans from 

the United States and the international community. 

Thank you so much, Mr. Chairman. 

Mr. DUNCAN. And you got all that done in just 4 seconds over 

your time. Thanks for the comment on the beard. I don’t know how 

long it will stay. 

And we can all take a page out of your playbook for leadership 

on issues with regard to Latin American. So, thank you for that. 

Congratulations on passage of that. 

Ms. ROS-LEHTINEN. Thank you. 

Mr. DUNCAN. The Chair will now recognize Mr. Castro for an 

opening statement. 

Mr. CASTRO. Thank you, Chairman, and thank you for holding 

this hearing today. 

The United States has an interest in making sure that around 

the world, particularly with allied nations, human rights and democracy are respected, whether their leaders fall on the right side 

of the spectrum or the left side of the spectrum, whether they are 

liberal, or conservative, or communists, or fascists, making sure 

that these nations have leaders who respect their people. That 

means respecting the institutions of democracy. And what we have 

seen in Nicaragua is especially troubling. 

And so, I look forward to the testimony and thank you for holding the hearing. I yield back. 

Mr. DUNCAN. I thank the member. No other member seeking recognition. We will go ahead and start the hearing. 

Before I recognize the witnesses, there is a lighting system in 

front of you. Just try to adhere to 5 minutes. We are not really 

pressed today, other than members are trying to get out of town 

for their weekend, back in the District, campaigning, and other 

things. So, if we can just stay on time, that would be great. 

Bios were provided to the members. So, I am not going to read 

the bios. 

Welcome again. I think I know Mr. Gonzalez has been here before and I welcome the young lady. So, I am going to recognize you 

in order. Mr. Gonzalez, you are recognized for 5 minutes. 

STATEMENT OF MR. JUAN GONZALEZ, DEPUTY ASSISTANT 

SECRETARY, BUREAU OF WESTERN HEMISPHERE AFFAIRS, 

U.S. DEPARTMENT OF STATE 

Mr. GONZALEZ. Thank you, Mr. Chairman, ranking members, 

and members of the committee. It is an honor to testify before you 

today. I have submitted my testimony for the record and I thought, 

with your concurrence, I would use my time just to highlight the 

main points. 

Mr. DUNCAN. Can you pull that microphone just a little bit closer? We are trying to record all of this for posterity. 

Mr. GONZALEZ. Understood. Without your objection, Mr. Chairman, I would like to submit my testimony for the record and just 

highlight the main points in my opening remarks. 

I last testified, as you mentioned, when this committee held a 

hearing on border security in March, which remains an incredibly 

7

issue and a national security priority for the administration. And 

thank you for your leadership in chairing that hearing. 

And I cannot let an opportunity go by to also thank this committee for its support for Central America. To be frank, we would 

be nowhere without you and we are actually very working aggressively to implement the U.S. strategy for engagement in Central 

America and it is all thanks to the work of this committee and the 

Members of Congress. 

Today we also celebrate the 195th anniversary of Central America’s independence. The region’s history is closely intertwined with 

ours and the region’s prosperity and security has always mattered 

to the United States. Throughout, we have seen positive signs, like 

the region’s active efforts to integrate and cement trade partnerships with the United States, Europe, Asia but challenges abound 

as well. Corruption is rampant throughout. Transnational criminal 

organizations challenge the state in some areas. 

Equally concerning is the state of democratic institutions in various parts of Central America but I would say most so in Nicaragua, where President Daniel Ortega has been working to transform the country into a de facto one-party system. 

The government’s recent actions restrict free and fair elections 

and to dismantle democratic institutions, such as independent political parties are troubling to us. While certain freedoms continue 

to exist and elections are still being held in November, the Sandinista National Liberal Front has applied the tools of incumbency, 

influenced the judiciary, and manipulated the political influence 

and intimidation to eliminate the system of checks and balances 

necessary for a vibrant and functioning democracy. The cumulative 

effect of these actions threatens to render the upcoming elections 

a pantomime of democracy. 

And the question before us is how to respond. In sum, the approach we are taking if four-fold. First, we are voicing our concerns 

and exposing such authoritarian actions for what they are. To 

avoid bilateralizing the issue, we need to work with multi-lateral 

organizations and we are doing this. 

Second, we are standing in solidarity with Nicaraguan civil society and supporting democratic institutions in every way we can. To 

be clear, ours is not an anti-Ortega strategy; it is a pro-Nicaragua 

strategy and we are working with the opposition, as well as elements of the Sandinistas. 

Third, we are engaging directly with the Nicaraguan people. The 

future of Nicaragua will not be determined in Washington and only 

by the Nicaraguan people. So, our Ambassador is out there every 

day making the case for better U.S.-Nicaraguan relations and 

speaking on behalf of strong democratic institutions. Actually, I 

don’t think Ambassador Laura Dogu sleeps. She is an active advocate on behalf of the United States. 

And fourth, we continue to have interests in the country and we 

need to continue advancing those interests. So, we will continue to 

cooperate with them in areas where we have a direct interest, like 

counter-narcotics and combating transnational criminal organizations. 

Again, we continue to closely monitor the developments as they 

relate to the election. It is something incredibly concerning. And we 

8

look forward to working with members of this committee on the 

best ways to promote our interest in Nicaragua. Thank you very 

much. 

[The prepared statement of Mr. Gonzalez follows:]

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Mr. DUNCAN. Thank you, Mr. Gonzalez. 

Now, I will recognize the Honorable Marcela Escobari for 5 minutes. 

STATEMENT OF THE HONORABLE MARCELA ESCOBARI, ASSISTANT ADMINISTRATOR, BUREAU FOR LATIN AMERICA 

AND THE CARIBBEAN, U.S. AGENCY FOR INTERNATIONAL 

DEVELOPMENT 

Ms. ESCOBARI. Chairman Duncan and Ranking Member Sires, 

and members of the subcommittee, thank you for the opportunity 

to testify before you today and for speaking out on the Government 

of Nicaragua’s efforts to restrict democracy. 

I am grateful for the committee’s support for the work of USAID 

and for your leadership in our engagement in Central America. I 

have actually just come back from the Northern Triangle and I saw 

firsthand how our support is making a difference. This is a historic 

opportunity to help these countries in their effort to improve the 

lives of their citizens and the political will for reform is definitely 

there. 

Despite significant challenges, citizens are demanding accountability and local institutions are responding from CICIG in Guatemala to the show of independence in the Attorney General offices 

of each of these three countries, they are making significant strides 

in accountability and transparency. 

These gains are in stark contrast to the situation in Nicaragua, 

where the Ortega administration continues to close democratic 

space and consolidate power. Nicaragua is the second poorest nation in the Western Hemisphere. The country has yet to reach the 

levels of income per capita it had in 1978. Criminal activities and 

violence are on the rise on the country’s Caribbean coast, which is 

also the area with the worst poverty indicators, where 40 percent 

of boys and girls do not attend school. This is not a country that 

can afford a government that refuses to be held accountable and respond to those most in need of assistance. 

We must continue to support the people of Nicaragua in their efforts to participate in the democratic process. And two-thirds of 

USAID’s bilateral assistance focuses on this priority. We are supporting over 60 civil society organizations to help them be effective 

in advocating for citizens’ rights. We are also helping nurture the 

next generation of civic leaders. We work with a network of over 

2,000 young people who have participated in our leadership programs. They are leading local initiatives that matter to them, from 

bringing drinkable water to their communities to advocating for 

human rights but they are also increasingly making up the ranks 

of leadership in public and private organizations. These efforts are 

allowing them to exercise their political muscle and see results. 

As a result of USAID efforts, citizens are also holding municipal 

governments accountable, exercising democratic principles at a 

local level. Citizens have submitted nearly 200 proposals to extend 

services for youth, women, and the disabled in nine municipalities 

and nearly half of these proposals, worth over $1.6 million, have 

been incorporated in municipal budgets. 

We are also strengthening independent media, as they face restrictive regulations and dwindling resources as advertisers pay a 

14

political cost for their support. USAID works with over 20 organizations in press, radio, and television to strengthen their operations and help them be more effective. 

While democracy and governance remain USAID’s priorities in 

Nicaragua, we also support citizen security and education in the 

autonomous Caribbean coast, where the worst poverty indicators 

exist. USAID education programs help improve early grade reading, which is an important determinant in keeping kids in school. 

Our vocational programs with the private sector are helping youth 

become employable with skills in carpentry, plumbing, car repairs, 

and ultimately become productive members of their society. The 

autonomous Caribbean region is home to the most isolated and vulnerable populations in Nicaragua and helping these populations 

prosper is also crucial to a thriving and healthy democracy. 

USAID will continue to evaluate and adjust our programs in 

Nicaragua so that they remain effective and, looking forward, will 

continue to elevate Nicaragua’s most prominent civil society organizations and connect them with organizations around the globe who 

are facing similar challenges. It is imperative that the U.S. Government continue to engage and stand by the people of Nicaragua. We 

are a lifeline that helps them advocate for their rights and freedoms in an increasingly challenging environment. 

We share a commitment to democratic governance with our regional neighbors. As stated in the Inter-American Democratic 

Charter, the peoples of the Americas have a right to democracy and 

their governments have an obligation to promote and defend it. 

I want to thank this committee again for your leadership and 

support and I look forward to your continued counsel and welcome 

your questions. 

[The prepared statement of Ms. Escobari follows:]

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Mr. DUNCAN. I thank both the witnesses and will step out of the 

norm here and recognize the ranking member first for 5 minutes. 

Mr. SIRES. I want to thank the chairman for his consideration. 

You know it is always bewildering to me how the second poorest 

country in the Western Hemisphere, basically, is buying tanks, is 

buying planes, is buying all sorts of arms and yet, the need of the 

people seems to be ignored. 

So, I am just wondering if this is the typical intimidation factor 

that leaders that abolished democracy or tried to circumvent democracy usually use. Or why do you think he needs so much artillery, Warren—or I am sorry—Mr. Gonzalez? Like my buddy. 

Mr. GONZALEZ. Thank you, Congressman. So, you are exactly 

right, actually, Nicaragua is the second poorest country in the 

Western Hemisphere. What we have seen, however, is that even 

though he won and actually observed the 2006 election when Ortega came back to power. He won with just roughly 38 percent of 

the vote. 

Today, he enjoys 60 percent or so level of popularity and a lot 

of that has been as a result of a lot of the social investments that 

he has made in the country. There have been reductions in poverty, 

even though the level of poverty remains above 39 percent but a 

lot of it is a result of Venezuela’s largess. And in our view, it is 

not sustainable, particularly, in the absence of strong institutions. 

Every country has the right to buy military equipment. And is 

it something that they are using as a tool of intimidation? What 

is clear to us is that the approach that Ortega has actually been 

using since 2006 have been overt efforts to consolidate one-party 

control, something he has been working on since he returned, remove even independent allies within Sandinista, repress civil society, independent media, and the opposition, control the private sector and advance an active propaganda for the Sandinista party. 

But to answer your questions, sir, there is this old Latin American saying, which is for our friends, anything and for our enemies, 

the law. So, they are using a way to actually technically using legal 

systems to undermine the opposition in a way that is bad for the 

country’s democracy and for the thriving of civil society. 

Mr. SIRES. Thank you. Marcela? 

Ms. ESCOBARI. So, I would just agree with your comment that we 

agree that the Nicaraguan Government should be focusing more on 

its poor, particularly the Caribbean Coast, which is an isolated 

area with the most vulnerable populations and we have seen violence and poverty increase in those areas. 

Mr. SIRES. Thank you. And through this process, Daniel Ortega 

and his family have become very wealthy in the last few terms, I 

understand that one of the richest in Nicaragua. Is that accurate? 

Mr. GONZALEZ. Well, I know that the wealthiest 10 percent receive roughly 39 percent of all income and that right now the bottom 30 percent receive roughly 8.3 percent. So, there is a huge 

level of inequality that endures in Nicaragua. 

Mr. SIRES. Yes, but I am talking about the President and his 

family. 

Mr. GONZALEZ. I could get you information. I don’t have the details on his personal wealth. 

20

Mr. SIRES. But he is doing much better than he has done before, 

right? 

Mr. GONZALEZ. I imagine, yes. 

Mr. SIRES. You are being a good politician here. 

Thank you, Mr. Chairman. 

Mr. DUNCAN. I thank the ranking member. 

I am now going to go ahead and recognize Mr. Yoho for 5 minutes. 

Mr. YOHO. Thank you, Mr. Chairman. I appreciate the meeting 

here. 

And I want to spin off of my colleague, Mr. Sires, about here we 

are the second poorest country in the Western Hemisphere, yet, 

they are buying tanks and planes from Russia. And we engage in 

the IMET Initiative, the International Military and Education 

Training. What are we benefitting out of this? Are we showing 

them our techniques and our skills and all that? And they are 

using Russian forces. Is that benefitting us and who are they preparing for an invasion from? Or is it like Ms. Ros-Lehtinen said, 

to keep oppression on the people? 

Mr. GONZALEZ. Congressman, thank you for your question. 

The IMET support that we provide to Nicaragua, I have got to 

say that they are not allowing members of the Nicaraguan military 

to actually come up here. And I think it is, my interpretation is because what we actually do through IMET training is create a professional military. We promote the respect for human rights. We 

find synergies between U.S. and foreign militaries and it has been 

an effective took for us to cooperate with foreign militaries around 

the world. 

Mr. YOHO. Let me interrupt you there. You said we respect their 

rights for human rights or their initiative on that. 

Mr. GONZALEZ. Well, the types of classes that we teach through 

IMET where we will bring people up here is a series of classes that 

include human rights, better interoperability with U.S. military, 

those types of trainings. They have not actually allowed Nicaraguan military to come up for the training. 

Mr. YOHO. All right, I want to drop back and come back to that 

because how do you hold a dictatorship like Ortega accountable 

when we know they are doing what they are doing? They are dealing in human trafficking. They said there is not a lot of narco trafficking but how do we know that is true? We know the heroin is 

coming across the Mexican border. Where does the heroin come 

from? 

Mr. GONZALEZ. Well, we have actually concrete results in cooperating with them on counter-narcotics. 

Mr. YOHO. Well, again, where is the heroin coming from? We 

know it is coming across the Mexican border into America. Where 

does it come from in South America? 

Mr. GONZALEZ. Well, the source countries include Colombia, I 

would say, primarily but——

Mr. YOHO. Okay, so how does it get from there to Mexico, to the 

United States, if it is not coming through Nicaragua? Are they 

going around that? Are they going through that and we don’t know 

about it and we are facilitating with our military intelligence, givVerDate 0ct 09 2002 13:34 Nov 22, 2016 Jkt 000000 PO 00000 Frm 00024 Fmt 6633 Sfmt 6633 F:\WORK\_WH\091516\21546 SHIRL
21

ing them foreign aid and teaching them our counter narcotics 

methods? 

Is that helping us or is it helping them circumvent our counter 

narcotics interdiction? 

Mr. GONZALEZ. It actually helps us because it instills, it aligns 

values, in a way, actually, of how you manage responsible and a 

political military. 

In terms of the flow of drugs, cocaine and heroin that come up 

to the United States, they go by land and by air. Mostly, they will 

skip over Nicaragua, even though they are, right now I think in 

2015 we seized over 4.3 metric tons of cocaine but a lot of them 

are overshooting and going to other countries or going, obviously, 

still through land but in lower numbers because Nicaragua has actually been very active on the counter-narcotics front. 

Mr. YOHO. All right and then let me ask you this, Ms. Escobari, 

if you would answer. How are we going to respond if the elections 

are run as a mockery to democracy in their country with a constitution that says he can’t run another term, his wife can’t be 

there? How are we going to respond? 

And I would also like to know about the hypocrisy of what happened in Honduras when their President ran for the third term 

and the people of that country stood by their constitution and 

pulled him out but, yet our administration, along with Ms. Clinton, 

said that we can’t do that; we have to stand by that President of 

that nation. But yet, the opposite is happening here and where is 

the outcry from the administration? 

So, what are we going to do, the first question is, after this election and it is a mockery? What is this administration’s response 

going to be? 

Ms. ESCOBARI. Well, thank you, Congressman for your question. 

And it is true, we are also very troubled about the lack of electoral observers in this election. Through USAID, we are working to 

continue to push for accountability. We are even running up to the 

election. We are working with youth organizations that are able to 

monitor fraudulent election practices and misuse of funds. During 

the election, we are also going to have volunteers who are going to 

try to be in polling stations and report on——

Mr. YOHO. How effective is that? I mean you have got youth 

monitoring that but you have got a country that has tanks and all 

that other stuff. How realistic is that? 

Ms. ESCOBARI. No, absolutely, this is not the ideal situation. And 

we very much regret the setbacks in a fair electoral procedure. 

And we are mentioning here the things that we are trying to do 

just not to stay quiet and to continue to try to push for accountability and at least make sure that there are observers and they 

are able to share with the Nicaraguans and outside, if things continue to proceed as they——

Mr. YOHO. I am out of time and I will yield back. If there is another round, we will come back to that. Thank you. 

Mr. DUNCAN. Thank you, Chairman. 

Now, we will go to Mr. Castro. 

Mr. CASTRO. Thank you, Chair. 

22

Let me ask you all about Nicaragua’s involvement with Russia 

and China. What is the extent of those two nations’ involvement 

with Nicaragua? 

Mr. GONZALEZ. Thank you, Congressman. So, separate from Russia and China, whenever a third country is involved in Latin America or Central America and promoting a hemisphere that Vice 

President Biden calls secure middle class and democratic and is 

abiding by international rules, it is not a zero sum game. We say 

welcome. You can’t take those roads with you when you build 

them. 

Specifically to your question, sir, Russia has seen itself specifically isolated over the past several years, as they face international 

outcry over its incursions in other parts of the world. And so they 

have tried to increase their engagement. If you seize the countries 

that they have an opening with, like Nicaragua, are few and far 

between. The engagement tends to be transactional. And it is something we are watching very closely but we see it as limited and to 

arms sales and resulting spare parts and training as a part of the 

main part of the relationship. 

Mr. CASTRO. Is there a foreign aid component from either of 

those countries over Nicaragua that you all know of? 

Mr. GONZALEZ. Well, with regard to Russia, they will provide 

credits. As you know, they sold the tanks to Nicaragua. But beyond 

that, it has been mostly just a transactional arms trading exercise. 

It is something that we are watching very closely and it is something that we would welcome an opportunity to brief you in a classified setting. I know we have discussed this with the chairman in 

a classified setting before and welcome that opportunity. 

Mr. CASTRO. Sure. Did you have something? Okay. 

And can you describe the status of our security cooperation under 

CARSI and how that is coming along? 

Mr. GONZALEZ. Yes, so Congressman, our assistance that focuses 

on Central America is one that does not go directly to the government. We providing training, equipment and so on and so forth. 

Overall, we are going to provide $13 million in 2016 funds and the 

impact is one where we have actually worked with the Nicaraguan 

Navy, which even though it has really limited assets, conducts regular patrols and interdiction operations in their internal waters in 

the Pacific and in the Caribbean Coast. We have donated equipment. They are actually using donated Nor-Tech Boston Whalers 

and refurbished boats under Section 1033 authority, which is the 

DoD money but it something that has synergies with the Central 

American Regional Security Initiative. 

And the support, again, is the work that we do is there will be 

training and we will provide equipment that is specifically focused 

toward the counter-narcotics operation. The results have been, as 

I mentioned earlier, 4.3 metric tons in seized assets last year. So 

far, they have arrested over 135 people, seized $2.8 million and 55 

go-fast boats and other means of transport. And so we are having 

a lot of results in that area of cooperation. 

Mr. CASTRO. And also, Nicaragua is party to CAFTA, right? 

Mr. GONZALEZ. That is correct. 

Mr. CASTRO. What effect has that had on the country? 

23

Mr. GONZALEZ. Well, it has actually been significant. Actually, 

our trade, two-way trade has doubled in the past decade. We have 

a $5 billion trade relationship and our exports have increased 25 

percent in 2015 or up 18 percent as far as July of this year. 

But Congressman, to the point on the democracies, we could do 

so much more to cooperate with Nicaragua in the way that we do 

with other parts of Central America. But because of the limiting of 

democratic freedoms, we have a very limited scope in which we 

work with the government. 

Mr. CASTRO. Okay, thank you. 

Mr. DUNCAN. We will take just a second. 

[Recess.] 

Mr. DUNCAN. For the record, Chairwoman Ros-Lehtinen was a 

great chairwoman of the Foreign Affairs Committee. She was very 

fair to me when I was a freshman member. So, I would do anything 

for her. 

I let her catch her breath and the Chair recognizes——

Ms. ROS-LEHTINEN. Thank you, Mr. Chairman. Thank you. And 

I have been listening to the testimony and the questions from the 

side room. So, I appreciate your testimony and the questions from 

the members. 

Secretary Gonzalez, I would first like to thank you for working 

closely with our committee and staff. My staff has briefed me on 

how helpful you have been with providing information and briefings regarding Nicaragua. So, I want to say gracias, that we appreciate your work on this issue. And as you have just witnessed, before the hearing, we had the markup. We passed the Nicaragua 

legislation in a bipartisan manner. 

Do you think that this legislation helps advance U.S. efforts to 

hold the Ortega regime accountable for its violations against 

human rights and electoral manipulation? 

Mr. GONZALEZ. Madam Chair, thank you for your words. First of 

all, I think the most important lesson Vice President Joe Biden 

taught me was taking very seriously the advice and consent role 

of the U.S. Congress. So, it has been a pleasure to work with you 

and your staff. 

So, while we cannot comment on pending legislation, I will say, 

Madam Chair, that we share the principles behind it and, frankly, 

the work that this committee and that you personally doing to 

spotlight the challenges in Nicaragua. So, we share the principles 

but I cannot comment on the specifics. 

Ms. ROS-LEHTINEN. Absolutely. I understand. 

Also, press reports have indicated that the Ortega regime will 

now exercise control over diplomatic pouches. This is very troubling. Is this accurate? And if so, how will this impact the work of 

our U.S. Embassy officials and its staff? 

Mr. GONZALEZ. Madam Chair, my understanding is that they are 

going to—they have announced that they will begin using an x-ray 

of packages, which is something that they can do under international law but it is something we are watching very closely because any step beyond that to maybe move to open it would be 

something that would be in violation of their international obligations and would be troubling to us in the course of——

Ms. ROS-LEHTINEN. Well, thank you for that. 

24

And Administrator Escobari, thank you so much. It was a pleasure meeting with you just yesterday. 

Congress brought back USAID back into Cuba, as we fast 

tracked your congressional notification last year, yet it took over 6 

months to get the program dollars out the door. In Venezuela, 

USAID decided to cut the democratic program dollars last year to 

$3.2 million. While this was quickly corrected after congressional 

intervention, I worry about the signal that this sends about 

USAID’s commitment to promoting democracy efforts. We can’t let 

the fear of possibly being expelled from the country from scaring 

USAID from cooperating in closed societies. And in Nicaragua, 

USAID has failed to improve the democracy programs in Nicaragua 

for years. And in 2012, I sent a letter to USAID stating that funds 

to Nicaragua have not been spent wisely and prohibited funds from 

being used in the Ortega-controlled municipalities or from being 

used to work with the Ortega regime. Yet, just months ago, committee staff traveled to Nicaragua and USAID officials requested 

flexibility in order to work with officials from the Ortega regime 

and that is just simply unacceptable. 

How can we work together in order to improve the democracy 

programs in Nicaragua? I know that is your goal. That is our goal 

as well. How can we help Nicaraguan civil society who are being 

oppressed on a daily basis? And related to that, if you can share 

with us some success, in terms of human rights and democracy, the 

program that you have from USAID programs. Is the country more 

democratic and with stronger civil society and empowered human 

rights organizations now? Thank you. 

Ms. ESCOBARI. Thank you very much Madam Chairman. 

At USAID, we totally share your concerns and your focus on 

democratic programming. And it actually makes up the priority of 

our bilateral funding to Nicaragua. If you ask me, I think the last 

years have witnessed more democracy and governance setbacks 

than gains and it has become a more challenging environment to 

work in. 

That said, we continue to support over 60 civil society organizations, local organizations, both through international partners and 

through directly with many of them and we are trying to strengthen them. For many of them, we are their only lifeline, as many 

other donors have left. 

We have also started working with younger people and organizations that advocate for democratic principles at a local level. And 

we are also working with independent media, which we believe is 

a very important force that needs to remain open and is facing increasing challenges in this environment. 

Ms. ROS-LEHTINEN. Thank you very much, Mr. Chairman. Thank 

you for allowing me to speak and for the markup earlier today. 

Thank you, sir. 

Mr. DUNCAN. You are welcome. Anytime. 

I now recognize myself for 5 minutes. And I would like to start 

with the expulsion of three U.S. citizens in Nicaragua, Mr. Gonzalez. 

On June 13th, three U.S. citizens traveling on openly cleared 

U.S. official government business were kicked out of Nicaragua. 

Such actions suggest flagrant disrespect by the Ortega Government 

25

for commonly accepted principles of government-to-government relations. 

Given the erosion of democracy in Nicaragua, the clear contempt 

that Nicaragua has displayed in its government-to-government relationship with the U.S., is it appropriate to continue to reward 

Nicaragua with a virtually unrestricted access to U.S. markets that 

the nation receives under CAFTA? 

Mr. GONZALEZ. Mr. Chairman, thank you for that question. 

While it is the right of every nation to control its borders and 

who enters and, obviously, official interaction, we agree. We coincide entirely with you that the expulsion was unwarranted and inconsistent with a constructive and positive bilateral relationship. 

Immediately after, the two officials who were actually there to facilitate trade on textiles, I, personally, spoke with Ambassador 

Campbell and made clear the potential ramifications of going down 

this road. We communicated a diplomatic note and, since then, actually, clarified the travel procedures with the Nicaraguan Government. 

Since then, we have not had problems. And we know that there 

have been religious organizations and faith-based organizations 

that have been interested in doing work, we have had journalists 

and others. 

Since the new travel procedures have been established, we have 

been able to go forward without incident but we have made it clear 

that we will have to reconsider how we respond if this is something 

that continues. 

Mr. DUNCAN. Given the fact that Nicaragua is one of the poorest 

countries in Central America, who do you think benefits the most 

from a free trade agreement with the United States, the United 

States or Nicaragua? 

You don’t need to answer that. I think Nicaragua does. You are 

a diplomat. I am a politician. 

Nicaragua benefits from that access to the United States but we 

continue to see things like this happen and the United States goes 

right back in and continues to cozy up to these countries, when the 

countries have sort of thumbed their nose at the U.S. This has happened in Venezuela in the past. It is now happening here. And it 

is definitely happening in Cuba. 

So, let me ask you this. I have got concerns with U.S. Ambassador Dogu’s actions. So, on June 8th, the Nicaraguan Supreme 

Court stripped the opposition Independent Liberal Party from its 

recognized leader and Ortega’s 2006 Presidential challenger, 

Eduardo Montealegre—I can’t pronounce that. My Spanglish isn’t 

that good. So, it put in the party under control of a governmentallied leader. 

On June 17th, the Supreme Court invalidated the leadership of 

the Citizen Action Party, the only remaining party with a legal 

standing to present a Presidential candidate. This also disqualified 

the Presidential candidate Luis Callejas and Ortega’s main challenge for the November 6th election. 

So, let’s get rid of all of our political opponents, using the Supreme Court to do that. But then recently, U.S. Ambassador Laura 

Dogu paid a visit to Nicaragua’s Supreme Court. She shouldn’t 

26

have dignified them by visiting them. So, why did that visit take 

place? 

Mr. GONZALEZ. Mr. Chairman, first on the trade point, I just 

want to say that it is in our interest to actually engage with the 

Nicaraguan people and trade. While it does benefit the economic 

elites, it also benefits the people. 

But we are looking at, as the elections progress and coincide with 

everything that you have said on the treatment of political opposition, we are looking at all of our tools at our disposal, understanding that there is no silver bullet and that the Nicaraguans 

have to be the ones that decide the future of their country. 

The Ambassador Dogu, who has been very active on the ground, 

we coincided that diplomatic engagement is not a reward. It is an 

opportunity to actually make very clear what our concerns are. And 

whenever she meets with the Supreme Court and she meets just 

as much with members of the opposition, civil society and youth, 

and the government, makes very clear what our concerns are and 

where U.S. policy is headed. And so we feel like she has been very 

effective in that regard. 

Now, just very briefly on the political situation. I don’t need to 

tell this committee that the political process involves constant compromise. But in the United States, we are not perfect. Our democracy is always improving. But we speak out on these sorts of issues 

not because we are perfect but because we think the ideal of not 

persecuting people if they disagree with you is the right ideal, 

number one. And we do not have, as Americans, confidence in a 

system where one person or one family is making all of the decisions. 

And we believe that in a democracy, if we believe in democracy, 

it means everybody has to have a chance to speak out and actually 

offer their views. And that is what being undermined in Nicaragua 

and I think, in the long-run, will not be good for the country. 

Mr. DUNCAN. Let me just say this. I think if a country is a recipient of the money from the U.S. taxpayers for economic assistance 

and USAID and all of this, and we are trying to court or support 

democracy and free elections, and individual liberties, humanitarian rights, and those sort of things, these countries ought to, 

personally ought to be a little more friendly to the United States. 

And kicking out diplomats, and I don’t know all of the details of 

that, but I disagree from what I know. 

So, let me just ask one other question and then I will move on. 

The United States supports OAS. OAS supports democratic principles throughout the region. And you are not representing the 

OAS but I would ask your opinion on why the OAS hasn’t been any 

stronger in its stance over what has gone on in Nicaragua with regard to the elections because the elections are the core of democracy. 

So, why would you think the OAS hasn’t been stronger in this 

instance? And we have seen the OAS really take not stringent 

enough positions against Venezuela. So, why wouldn’t the OAS be 

stronger here? 

Mr. GONZALEZ. Mr. Chairman, on your first point, we coincide 

entirely. One of the strategies that the Ortega administration has 

taken is to actually essentially control the private sector, under the 

27

presumption that as long as they have good counter-narcotics cooperation with the United States and a good relationship with the 

private sector, they pay their international debts, that we will turn 

a blind eye to the undermining of democracy. 

This will have, I think—we are approaching a situation where in 

November they will be free, in the sense that people will be allowed 

to vote in the election. But they will not be fair and it is something 

that over time will undermine, I think, how the institutions work 

and it will have implications for the private sector. And it is something that in Nicaragua but around the hemisphere and around the 

world, Secretary Kerry, our Acting Assistant Secretary Mari Carmen Aponte have made anti-corruption efforts a priority. 

And we have taken actions even with our allies in places like 

Honduras. You have seen our work in Guatemala and it is something that we are looking at everything we have in our diplomatic 

toolbox to see how we can actually tackle these sorts of issues of 

corruption, violations of human rights, et cetera. I look forward to 

working with you and your committee on developing those tools 

most effectively. 

On the OAS briefly, sir, we have done everything possible to try 

to get the Government to agree to invite an electoral observation 

machine. I will note that the OAS is observing the U.S. election. 

So, it is not that we are saying do what we say and not do what 

we do, we are actually walking the walk in this case. 

And the OAS is actually looking very closely at the situation in 

Nicaragua. I understand they are working on a report that they 

will release. And the reality is that currently the time is closing for 

there to be an international observation mission and that the conditions maybe don’t exist for there to be a fair election, as I mentioned. 

Mr. DUNCAN. I didn’t mean to put you in a predicament there 

talking about the OAS but when I read of the history of the OAS, 

I am pro-OAS. I know what it was founded for. I know what it is 

supposed to be doing with regard to democratic principles in the region but I think we are approaching at point, to use your term, we 

are approaching a point where the OAS is becoming less effective 

because they continue to kind of deviate or water down their traditional stances in those regards, with regard to Nicaragua, in this 

case, Venezuela. 

So, I would say that if the OAS was sitting here. I think they 

need to go back, reread their founding documents, reread their 

charter and come to a meeting of the minds on what they exist for 

because this is a prime example, where they need to—it shows a 

little bit more outrage with regard to what the Supreme Court in 

Nicaragua has done and taking it even one step further, what 

Maduro is doing in Venezuela with not allowing a recall when the 

Constitution of Venezuela calls for that. And when you believe in 

those democratic constitutional principles, you have got to adhere 

to that and OAS says we are going to support the democratic principles. So, where is the outrage for those founding principles? 

So, I am going to stop there. And I will now go to Mr. Castro, 

if he has got another round of questions. 

Mr. CASTRO. Thank you, Chairman. 

28

I have a question on Nicaragua and energy. Nicaragua does not 

produce oil and has long been dependent on imported fuel oil to 

generate electricity. My understanding is that Nicaragua has recently invested heavily in renewable energy, wind, solar, and geothermal, in particular. So, my question is, has the U.S. played a 

supporting role in this transformation and can Nicaragua’s renewable energy transformation be replicated across the hemisphere. 

Mr. GONZALEZ. Thank you, Mr. Congressman, for that very important question. 

One of the initiatives that when I was with Vice President Biden 

that we launched with our State Department Special Envoy for Energy Issues, Amos Hochstein, was the Caribbean Energy Security 

Initiative in June 2014 but then it is something that we also rolled 

out in Central America. 

And on the premise that the region’s dependence on expensive 

imported fuel provides headwinds to development and efforts to actually reduce poverty. And what we have been doing in Nicaragua 

has actually been we have been taking a regional approach. 

The countries have what is called the SIEPAC line, which allows 

them to coordinate in the transmission of electricity and it is something that is not being taken full advantage of. And it is something 

we are trying to provide technical assistance through kind of the 

regional energy market to help them actually take full advantage 

and get to the point where they can expand the capacity but also, 

because cooperation on energy issues between states is incredibly 

complicated, try to find a way to ensure that renewable energy is 

something that is integrated into the grid and not just traditional 

fossil fuels. 

Costa Rica and Nicaragua have actually taken very active steps 

on renewables. Honduras is making investments. And I think the 

positive consequences or results of our engagement have been that 

we are trying to streamline the way they do regulation, the way 

they take advantage of the line, and how they actually start expanding the use of renewables. 

Mr. CASTRO. Thank you. And then a question about the Chinese 

canal that is being built. How likely is it that Inter-Oceanic Canal 

underwritten by Chinese billionaire Wang Jing will actually be 

completed? And what implications does construction of the canal 

have for China-Nicaragua relations and Chinese involvement in the 

country? 

Mr. GONZALEZ. Congressman, perhaps this will sound 

undiplomatic but I am skeptical. We have not seen a single shovel 

being used in the building of the Nicaragua Canal. And so the position we will take is we will believe it when we see it. 

But it is something that we are watching, I think, very closely. 

The expansion of the Panama Canal is something that benefits 

U.S. ports in a significant way, because it allows us to reduce our 

shipping costs. And so, it is something that we are watching. 

With regard to China’s involvement, whether it is in Nicaragua 

or in the Caribbean, where they have also been very present, the 

message we have always conveyed to them is that there are international standards that all of us have to uphold and that insofar 

as they are upholding those and they are promoting secure, prosperous, and democratic region, we are welcoming their engageVerDate 0ct 09 2002 13:34 Nov 22, 2016 Jkt 000000 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 F:\WORK\_WH\091516\21546 SHIRL
29

ment. But we maintain a yearly active dialogue with the Chinese 

on Latin America and how best to actually maximize their cooperation in a productive way. 

Mr. CASTRO. Thank you. I yield back. 

Mr. DUNCAN. Great questions, Mr. Castro. 

I will go to Mr. Yoho for 5 minutes or as much time as he needs. 

Mr. YOHO. Thank you, Mr. Chairman. I appreciate it. 

And I kind of want to spin off a couple of things here but I want 

to read a statement here that Mr. Ortega said in Cuba. The current President Daniel Ortega gave a speech in Havana, Cuba, affirming Sandinista policies and ideology in joining the Non-Aligned 

Movement and in excoriating the imperialism of the U.S. That was 

a statement he made. Do you feel he has wavered from that or varied from that in his stance toward the U.S.? 

Mr. GONZALEZ. I can’t pretend to know what is in the mind of 

President Daniel Ortega but I know that often, be it Nicaragua or 

be it Venezuela, often the moniker of U.S. imperialism is a foil to 

distract from problems inside the country but also, I think, as a 

way to I think maybe brandish a sort of socialist—or not socialist—

a sort of way of governing and try to push out any sort of——

Mr. YOHO. I think we can tell where he stands with actions, 

when you see what they do. You know you are looking at the 

amount of corruption there and you look at the wealth. He is one 

of the wealthiest people in the country that is the second poorest 

country in the Western Hemisphere. And then you look at the loan 

that Venezuela gave them back a few years back, I think it was 

$457 million with no third-party oversight, it is a very convenient 

situation. 

And then they are buying Russian military equipment. They are 

putting up Russian military radar systems. And I am not feeling 

the love here. And I, along with the chairman, you know he was 

talking about the trade, the free trade agreement that we have 

with them, I don’t see the benefit we do. I see we do export but 

I think they are benefitting a whole lot more. And the benefit to 

them is they have a lot of money coming into their country that 

is promoting a rogue—a dictatorship, I will say. And with the administrator’s misstep of sending our Ambassador Dogu down there 

and allowing them to basically give credit to their Supreme Court 

for ruling out any competing parties in the political process, I just 

think that is a very poor judgment and misstep on this administration. 

We have all these conditions on trade. We have all these conditions on human rights. We have all these conditions on free and 

open elections and he has already said there is not going to be free 

and open elections because there is not going to be any monitors 

but yet, we are relying on the students to tell us how fair they are. 

How intimidated are those students going to be and how well are 

they going to speak up? And at what point does administration say, 

you know what, if you are going to play by the rules, we are done 

and pull out of the trade agreement? 

Do we have the backbone to do that? Does this administration 

have it or any administration? When is America’s word going to 

stand for what we say? 

30

Mr. GONZALEZ. Congressman, I will say two things. And thank 

you for your comments. We coincide entirely on the democratic 

backsliding in Nicaragua. 

Two things. First——

Mr. YOHO. Well, then we are not doing it with action. 

Let me ask Ms. Escobari. Is that close? What is your opinion on 

that? At what point does America say if you are serious about 

being an ally of ours? Because we have weakened the OAS and it 

is because of the actions. If our action is not standing up to—our 

words aren’t backed up by our actions. 

Ms. ESCOBARI. Thank you, Congressman. For our case, the majority of our programming is trying to strengthen the few and usually harassed organizations that are trying to defend democratic institutions and citizens. 

Mr. YOHO. How do you see them strengthening, if they are 

throwing people out that have diplomatic or regular passports and 

our administration is validating their Supreme Court? 

Ms. ESCOBARI. No, you are absolutely right that there has not 

been progress. There has been backsliding but we believe that we 

should still be there to stand with those organizations to continue 

to maintain some openness and to have these organizations that 

can speak for the citizens as that closes. 

Mr. YOHO. Yes, but if we are not willing to take something back 

for that government to lose, it is not going to get better. I mean 

history repeats itself. And until we are willing to stand up and 

make a strong stand, they are going to keep doing what they are 

doing and we are going to keep capitulating. And yes, we can say 

we are helping the people, which I think we should, but you have 

to hold that government accountable and you have to be willing to 

do that is what I see. 

And I yield back and I appreciate the second round, Chairman. 

Mr. DUNCAN. All right. This has been great. Do you have anything further? 

I want to thank the panel. Nicaragua is not a country that, since 

I have been here 6 years, other than when Chairwoman RosLehtinen was active in my first term, have we really delved into 

this. But what we are seeing, as brought out today, is just some 

things that we may not agree with going on with free and fair elections, and humanitarian rights, and strong military changes, and 

whatnot down there. 

So, we are going to continue focusing on it and I want to thank 

the service of our witnesses to our great Nation. And it is not lost 

on us, the sacrifices you make as well. So, thank you so much. 

I want to thank the committee for all of their participation, not 

only on the hearing but also on the markup. 

And without anything further, we will stand adjourned. 

[Whereupon, at 11:43 a.m., the subcommittee was adjourned.] 

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A P P E N D I X 

MATERIAL SUBMITTED FOR THE RECORD

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MATERIAL SUBMITTED FOR THE RECORD BY THE HONORABLE JEFF DUNCAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF SOUTH CAROLINA, AND CHAIRMAN, 

SUBCOMMITTEE ON THE WESTERN HEMISPHERE


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