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Michael Shifter: There is a debate in U.S. Government on how to pressure Ortega

President of the Inter-American Dialogue: OAS resolution strengthens isolation, but assesses impact of economic actions

The President of the Inter-American Dialogue, Michael Shifter, considers that after President Joe Biden approved the Renacer Act, a very strong internal debate arose in his Administration between those who advocate applying economic pressure measures against the dictatorship of Daniel Ortega, and those who wonder about the impact that these actions would have “on a country that is already suffering a humanitarian crisis”, generating strong migratory flows towards the border with the United States. 

Shifter explains that in political and diplomatic matters, the Ortega regime is considered a “dictatorship” like Cuba and Venezuela, and “the OAS resolution strengthens the US willingness to isolate Nicaragua,” but in terms of economic actions the question is “what impact it will have on jobs, if this impact is acceptable or manageable, and what impact it will have on the political survival of Ortega and the Government”. 

In an interview with Esta Semana and CONFIDENCIAL, Shifter warned that “even if (Ortega) releases some political prisoners, the police state is not negotiable for Ortega, because he knows that if he negotiates that, it’s all over for him” and advocated for “strengthening international pressure and pressure from Nicaraguans”. With that “there are more possibilities that this will result in a democratic transition, but there are no guarantees for anything”, it only “increases the possibilities”.

At the OAS Assembly of Foreign Ministers, 25 governments declared the Nicaraguan elections without legitimacy, with seven abstentions and Nicaragua voting against. How do you assess this resolution, and what impact could it have on a hardened authoritarian regime such as Ortega’s?

I think it is an encouraging, very important step, which comes a little late, by the way, because this is something they should have done long ago, given the democratic deterioration in Nicaragua,  but they finally did it, and 25 votes is a resounding vote, which in my opinion, reflects a significant change in the Latin American opinion with respect to the dictatorship in Nicaragua, and lays the groundwork for future actions. With that resolution, I imagine that they are going to send a Permanent Council mission to evaluate the situation in Nicaragua and based on that, decide if they are going to activate the Democratic Charter, which I hope they will do.

The foreign ministers instructed the Permanent Council to present actions within 15 days, by November 30, but what effective options does the OAS have to exert pressure? Would suspending the Government of Nicaragua from the OAS be contemplated?

I think that if they suspend Nicaragua, which remains to be seen, because we have to distinguish between the OAS resolutions and the assembly, with the intention to suspend Nicaragua from the OAS, but if it is suspended, it complicates the financial and economic support that the Ortega regime is receiving from the multilateral banks, and the suspension could have an impact on the policy of those banks. Suspension would mark an important change.

This week, President Biden passed the Renacer Act, which among other issues, talks about US scrutiny of multilateral loan agencies, coordinated sanctions with other governments, and Russia’s intervention in Nicaragua. What priorities will Biden adopt in terms of the implementation of this law?

I think there is going to be a strong debate within the Administration. On the one hand, some want to take a very tough position with respect to taking a big gamble against the dictator in Nicaragua and applying all kinds of economic pressure, and influencing the banks not to continue lending and supporting the Ortega regime, but on the other hand, others are going to say: we have to assess what impact these measures are going to have, and how they affect the Nicaraguan population, which is already suffering a humanitarian crisis, and also what impact it will have on the migratory flows from Nicaragua to Costa Rica, but especially towards the north, towards the border with the United States which, as we all know, is already a fundamental problem for the Biden Administration, and I think that some opinions will be cautious so as not to run the risk of aggravating a situation on the border, which is already very complicated.

In the labor sector, and among Nicaraguan and Central American businessmen, there is concern about the economic and social effects that an eventual suspension of Nicaragua from Cafta (Central American Free Trade Agreement) could have. The Renacer Act speaks of a review. Within this range of options that are contemplated, what is the assessment in relation to the Cafta issue?

That tool is another instrument that the United States has at its disposal, but I believe that the same discussion is going to arise. What does it really mean to withdraw Nicaragua from CAFTA? What impact will this arrangement have, first of all, what economic impact, not only on businessmen, but also on the people who have jobs that depend on this. Many jobs would be lost, and this has to be assessed, and secondly, even if this impact is acceptable or manageable, what impact will it have on the dictatorship, the political survival of Ortega, and of the Government, because if it worsens the situation of Nicaraguans, and drives migration, but has no impact on Ortega, I think there will be people that say: wait a minute, we should not have gone for that option. 

The Biden Administration says: the Ortega government is a dictatorship, not an ‘imperfect democracy’ or a ‘hybrid regime’. What political implications does this have for the US-Nicaragua bilateral relationship? 

It obviously reflects a confrontation, like the one with the other two dictators in Latin America: in a regional perspective, Cuba and Venezuela are the two countries that are suffering sanctions. Well, Cuba for over 60 years, and Venezuela in the last few years starting with Obama, then with Trump, and now this remains under Biden, but a lot of people will ask: what impact have those actions had on democracy in Cuba and Venezuela? So, despite the temptation and the desire to be very tough on Ortega, there are arguments… Some people will rightfully ask what impact have the sanctions had on the other two dictators we have in Latin America, and the answer is not very encouraging: the Cuban regime is very strong, and Maduro in Venezuela also seems stronger than ever, so I think we can expect a debate within the Administration on the costs and benefits of following a hard line in terms of economic pressure, because there is not much discussion on diplomatic pressure, and I think the OAS Resolution strongly strengthens the spirit and policy of the United States to isolate Nicaragua, but the economic part is more complex and I think in that case they are going to take into account those other dictatorships in Latin America.

From the Nicaraguan perspective – and I am referring to Nicaraguan society – the main demand has to do with the release of political prisoners and the suspension of the police state, that is, the recovery of freedom of mobilization and expression. Can this foreign policy of the United States and now of Latin America have an impact, or how does it connect with the issue of the national demand for the recovery of democratic freedoms?

This depends a lot on how Ortega reacts to a different situation than the one he faced several weeks ago. I believe that regional and international opinion has hardened him quite a bit. I am not a psychologist and I do not know how Ortega thinks or reacts, but I do not rule out that he may make some gestures, such as releasing some political prisoners, perhaps under the condition that they cannot participate in politics in future elections, but they would be free and in that way he can show the world a more open face and diminish the great amount of repudiation against him. It is possible that he will do that. On the other hand, he may also assume a more confrontational posture, and toughen up more, and resist any pressure, both within Nicaragua, as well as from the international community, and not take any more moderate measures.

In his proclamation speech on November 8, Ortega attacked the political prisoners, called them ‘stateless’, and even said ‘take them to the U.S’. Can that be interpreted as an attempt to banish them, to expatriate them, or that he wants to engage in some sort of negotiation with the U.S.?

I see this as a possibility of negotiating something. I think he wants to gain a little more space to continue, not to end the regime. You talk about a police state, but even if he releases some political prisoners, it is still going to be a police state and a dictatorship, and I think that is non-negotiable for Ortega, because he knows there is so much at stake and if he negotiates that, it is over for him, and he will protect his interests. But as far as the political prisoners, that is more negotiable and there may be room for an agreement of some kind, and from his point of view, making the international community a little bit calmer so that they forget about Nicaragua, so that they are distracted with other issues, because right now everybody is focused on Nicaragua, but he can say: – this is a passing thing, and he can make some gestures to lower the tension a little bit, and therefore it seems fundamental to me that all the democrats who oppose him,  both inside and outside, continue to put pressure on him. This is very important because it is very easy to let him be, after this farce of an election, and move on to other issues, and that should not happen, and hopefully it will not happen.

This article was originally published in Spanish in Confidencial and translated by our staff

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