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« Back to Nicaragua Country Overview

Structural Adjustment and Free Trade Policies

Since the early 1990s, the International Monetary Fund (IMF) and World Bank have placed pressure on the Nicaraguan government to privatize utilities and encourage foreign ownership of local industries, measures known as structural adjustment policies. Today, multi-national corporations control over 40 percent of the country's natural resources. As a result, hundreds of Indigenous communities are threatened by mining and logging companies that have recently stepped up their take-over of Indigenous lands. Indigenous Peoples have traditionally relied on local forests and lagoons for food, fresh water, and medicinal plants and as a source of their cultural and spiritual practices. But increasingly, when people go out to fish, hunt, haul water, or cultivate lands, they are confronted with armed guards protecting newly privatized property. For Indigenous Peoples, the loss of their lands means the destruction of their cultures, with grave consequences to health. For example, the destruction of local food sources, coupled with aggressive marketing of processed foods like bread and cola, is undermining traditional diets and worsening malnutrition. Cultural disintegration brings on social devastation that gives rise to health hazards like domestic violence and drug addiction.

Neo-liberal economic policies have left Nicaragua saddled with over $6 billion in foreign debt—one of the highest per capita rates in the world, and the highest in Latin America. As a condition of debt repayment, the IMF and World Bank continue to force the Nicaraguan government to prioritize the interests of multinational corporations and international lenders over the needs of poor women and families. While Nicaragua qualified for debt relief under the Heavily Indebted Poor Countries (HIPC) initiative, created by the IMF and World Bank to ostensibly reduce the debt of poor countries, the government is now be forced to adhere to even harsher neo-liberal policies that further cripple its ability to improve conditions for the poor majority.