Will Revoking the Reform Be Enough?

In Nicaragua, President Ortega has revoked the controversial law to reform the National Institute of Social Security, but demonstrations continue and business leaders are calling on the government to have a dialogue.

Monday, April 23, 2018

Five days of protests, looting and several deaths in different areas of the country is the result of the controversial reform that the Ortega administration announced on Wednesday, and which only five days later, it had to revoke in order to try to ease social tension. The reform aimed to raise the contribution paid by companies by 2% and employees' contribution by 5%, effective from July. The presidential decree 04-2018 was published this Monday in the Gazette number 76. 

See "End of honeymoon between businessmen and government"

Regarding the dialogue tables that it is hoped will be established in order to overcome the difficulties between the Government and the affected sectors, Elnuevodiario.com.ni reports that the Superior Council of Private Enterprise (Cosep) demands three conditions which are " ... the immediate cessation of repression on the part of the National Police and of government-related shock forces, the release of citizens detained for exercising their right to express themselves freely and peacefully and a guarantee of press freedom."

In response to the request from the private sector, Nicaraguan President Daniel Ortega said that " ...'A dialogue can not have conditions placed on it, a dialogue must be open'. He added that  "... the first issue that must be addressed is how to 'restore security, stability and peace for Nicaraguan families' and then after that discuss 'insurance, tax reforms and other issues'. "

The US embassy in the country has suspended routine operations at the diplomatic headquarters in Managua, and the State Department updated its travel alert, warning Americans to "reconsider traveling to Nicaragua due to crime and civil unrest."



More on this topic

Coffee: Law Reform Tailored to the Government

August 2019

The Nicaraguan government seeks to deprive the business sector of the power to propose its representatives to the National Commission for the Transformation and Development of Coffee Farming.

President Daniel Ortega presented an initiative to the National Assembly to modify the Law for the Transformation and Development of Coffee Farming, which among the changes includes that the Members of the Superior Council of Private Enterprise (Cosep) do not have the power to propose their representatives to the National Commission for the Transformation and Development of Coffee Farming (Conatradec).

End of Honeymoon Between Businessmen and Government?

April 2018

In Nicaragua, the private sector is opposed to the reform of the Social Security law recently approved by the Ortega administration, which increases the contribution quota of companies by 2%.

Loss of competitiveness, unemployment and greater informality is what entrepreneurs in Nicaragua predict would be the result of the reform of the Social Security law, which according to the publication in the official gazette, will come into force in July of this year. 

Government-Business Understanding Continues in Nicaragua

September 2013

Leading Nicaraguan entrepreneurs continue to support the model of economic negotiation with the government.

"Everyone here is free to move, the press is free to speak and I think from that point of view we are living in an open society," said the businessman Carlos Pellas, president of Grupo Pellas.

Nicaraguan Businesses Reject Constitution Reform

October 2009

Businesses unions communicated they are concerned and worried by a Supreme Court resolution enabling President's Ortega reelection.

The diverse business chambers issued communiques rejecting the decision of the Constitutional Chamber of the Supreme Court, some going as far as not recognizing it.

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