Nicaragua has much to recommend it from the foreign retiree’s perspective. It is a friendly, welcoming country with one of the lowest costs of living and of real estate in the Americas. It offers a user-friendly retiree residency program that is among the most affordable in the world right now.
[See: 10 Affordable Places to Retire Overseas in 2016.]
In addition, Nicaragua boasts lots of sunshine, beautiful beaches, great surfing, plus lakes, volcanoes and rain forest. The oldest Spanish-colonial city in the region, Granada, is a jewel of a town.
The trouble is that, when we think of Nicaragua, most of us think first of Daniel Ortega, whom we remember as a Cold War villain. Nicaragua’s President Ortega was (and still is) head of the country’s Frente Sandinista de Liberación Nacional, or Sandinista party. The Sandinistas are named for Augusto César Sandino, a well-known revolutionary figure who fought against the repeated invasions and occupations of Nicaragua by the United States and was assassinated in 1934.
Daniel Ortega came to international prominence in 1979 when the FSLN overthrew Anastasio Somoza, a dictator and the last leader of the Somoza family dynasty that had ruled Nicaragua since 1936. Considered a dictator, Somoza was not what you’d call a “man of the people.” His family owned about 20 percent of the arable land in Nicaragua and controlled about 60 percent of the country’s economic activity, which left most of the country’s wealth in the hands of the Somozas and their associates. Somoza hightailed it when his downfall was imminent, robbed the national treasury and fled to Miami, leaving Nicaragua deeply in debt. He was assassinated by a Nicaraguan hit squad in Paraguay in 1980.
On November 6, Nicaragua will hold a general election to select the next president. Most people believe that the incumbent, Daniel Ortega, in office since 2006, will be re-elected. This is raising concerns among some Americans who already are or who are considering the idea of living or investing in this country.
[See: 10 Affordable Places to Retire Overseas in 2016.]
No term limits. The first concern has to do with the lack of term limits in Nicaragua. Term limits were abolished by the legislature in 2014, allowing President Ortega to run again in 2016. He’s been elected president in 1984, 2006 and 2011. (The United States also didn’t have term limits until 1951.)
No opposition. Then there’s the lack of opposition. On June 8, 2016, the Nicaraguan Supreme Court decided a six-year-old lawsuit ruling that Daniel Ortega’s main opposition in the election — Eduardo Montealegre — was no longer the head of his party and was ineligible to run for election. Instead, they appointed an Ortega supporter, Pedro Reyes, leaving Ortega with no serious opposition. The Supreme Court in Nicaragua is dominated by appointees loyal to Ortega, so most assume the ruling and timing were politically motivated.
Power couple. Finally, there’s the running mate. President Ortega has named his wife, Rosario Murillo, as his running mate for the November election. Murillo is an intelligent, well-educated woman who speaks four languages. She descended from Augusto Sandino himself, joined the FSLN in 1969 and fought in the revolution. This looks to many people like it could be the beginning of another family dynasty.
Boiled down, the worry is that Nicaragua has what could be turning into a one-party system with a perpetual ruler and that the stage is being set for a liberal version of the country’s former Somoza dynasty. The U.S. Department of State issued a travel alert in June 2016 to warn U.S. residents about potential demonstrations during the election season and increased government scrutiny of foreigners’ activities. The travel alert expires on November 30, 2016.
Foreign retirees have the additional concern of property rights. In Nicaragua, like many other countries including in the United States, a certain setback from the ocean is public land and cannot be owned by any individual. The amount of beachfront land restricted in this way was in dispute in Nicaragua for many years. When the final ruling was made by the Ortega administration, the line could have been drawn in a way that would have allowed Ortega and his cronies to confiscate tens of millions of dollars of mostly expat-owned beachfront property. But Ortega has a track record of protecting property rights, including those of the foreign investors.
[See: 10 Retirement Hot Spots in the U.S.]
National politics and the reality of expat life on the ground can be different things. While you always want to make sure leaders do not threaten your personal safety or property rights, make any decision as to whether you’d like to live, retire or invest in Nicaragua based on whether the country is appealing and makes sense for you.
Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group.
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