Nicaragua Gets European Aid Package for Education and Health

October 4, 2007
Managua, Nicaragua

Nicaragua is about to get a lot more money. The European Union will give $300 million in economic aid to Nicaragua over the next several years. It is the second largest of four aid packages that the EU is giving to Central America countries. The president of the EU's external relations commission, who traveled to Managua yesterday, said the money will go to education and health.

The aid package follows an outpouring of support in the wake of Hurricane Felix, which affected nearly 198,000 people on Nicaragua's remote Atlantic coast and caused $850 million in damages. Latin pop star Shakira says she will donate $40 million for hurricane relief in Nicaragua and for Peru's recovery from a major earthquake.

On Friday, Nicaraguan representatives meet with the International Monetary Fund in Washington, D.C. to discuss a $100 million accord. The three-year program, once signed, is meant to reduce poverty and improve economic growth. Nicaragua President Daniel Ortega is also talking with the U.S. government about destroying old SAM-7 missiles in exchange for medical supplies, a deal American officials say they support.
The increased funds come at a key time. This year started optimistically; electricity worked and the economy was expected to grow at a faster rate than the rest of Central America. But experts now warn of tougher times in the next few months.

Record high oil prices are likely to drag down small businesses in the short term--it will cost them more to run diesel generators, the main power source for parts of the day. And there is no sign that the four-hour-a-day blackouts will end before the busy winter tourist season. The increased funds, at least, should give a healthier start to 2008.

Your Latin America Insider,

Suzan Haskins
for International Living