The value added of production at the two export processing zones increased 32 percent. Data from the U.S. Census Bureau shows Nicaragua exporting 439 million dollars worth of goods to the U.S. and importing 289 million dollars. U.S. exports to Nicaragua rose both in absolute terms and as a share of total Nicaraguan imports. Nicaragua's foreign debt remains unsustainably high, even after nearly half of it was forgiven in 1995-96. Debt service payments of 294 million dollars in 1997 represented 39 percent of export earnings.
Prospects are bright, however, for dramatic debt reductions in the coming years.
Foreign assistance flows remain high. Although U.S. direct bilateral assistance has declined in recent years, since 1990 we have contributed a total of 971 million dollars. As reflected in the chart below, rising imports caused a jump in the current account deficit in 1997. 1997 data is preliminary. President Arnoldo Aleman was inaugurated on January 10 and immediately began a concerted drive to modernize the economy and open it to foreign trade and investment.