After the votes were counted, Daniel Ortega became President Elect after winning 38% of the national vote. Early reactions to the result were cautious with much of the regional and international press adopting a ‘wait and see’ attitude. For the tourism and real estate sectors in particular, Ortegas’ approach to CAFTA, inward investment and the protection of property rights were signficant issues.
On the back of a campaign focused on the themes of “Peace and Reconciliation”, the result met mixed reactions from the international community. Ortega has been quick to address concerns with a pro-active approach in his first few days as President Elect. His first key meeting was with representatives of the foreign investment community at the Crowne Plaza Hotel in Managua. Representatives heard first hand as Ortega stressed his commitment to foreign investment, recognizing it as one of the keys to continued growth and future prosperity for the country.
He made clear his intention to support the DR-CAFTA and stated publicly that property rights would be protected. He continued the momentum this past week with meetings with COSEP (the Nicaraguan Chamber of Commerce) and key members of the banking and finance community.
On a global level, the geopolitical landscape has changed significantly since the Sandinistas were last in power and this is well understood by the Sandinista leadership. Secondly, on a more local level, the current Sandinista party is very different to the Sandinista party of old. The members, by their own admission, have matured and mellowed. Many of them have substantial financial and business interests in the country and so have a very personal stake in the future economic success of Nicaragua.
In addition, the Sandinistas have been very involved in the governance of the country at all levels over the last 16 years. Two of the biggest growth areas for tourism and foreign investment, the towns of Granada and San del Sur (along with the capital Managua), have had Sandinista local governments for a number of years now.
Representatives from real estate agency Coldwell Banker commented, “if we look toward the long term, a Sandinista victory may well emerge as a positive factor in Nicaragua’s history, sweeping away once and for all the old concerns rooted in memories of the revolution that have hung over the country for over 15 years. In the short term we may experience some price stability as investors watch what Ortega does in his first weeks in power. But after this period, as uncertainty over Ortega falls away, the property market is likely to come back stronger.”
Coldwell Banker Nicaragua – Real Estate Investor Briefing
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