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LATIN AMERICA ADVISOR

LATIN AMERICA ADVISOR

A daily publication Of the dialogue

December 20, 2024

What’s the Future of U.S.-Nicaragua Economic Ties?

Nicaraguan President Daniel Ortega recently named his wife and vice president, Rosario Murillo, as “co-president.” // File Photo: Nicaraguan Government.

Q

  • U.S. Trade Representative Katherine Tai announced Dec. 10 that her office has opened an investigation into alleged human and labor rights violations in Nicaragua. The move came amid reports of increasing repression tactics against opposition and civil society groups by the government of President Daniel Ortega, who in November appointed his wife and vice president Rosario Murillo as co-president, the Associated Press reported. In what ways might the U.S. trade representative’s investigation affect Nicaragua’s economy, especially considering its membership in the Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) with the United States? How is Nicaragua’s government likely to react to the investigation? How is Nicaragua’s relationship with the United States likely to change under the incoming Trump administration?

A

Alexandra Solórzano, chief executive owl at Owl Consultancy Group: “U.S. Trade Representative Katherine Tai’s investigation into alleged human and labor rights violations in Nicaragua could significantly affect Nicaragua’s economy and its relationship with the United States. Nicaragua’s economy, heavily dependent on U.S. trade, is vulnerable to potential trade actions resulting from this investigation. As a member of CAFTA-DR, Nicaragua faces complicated implications, with some U.S. policymakers proposing expulsion from the agreement. Possible enforcement measures could include tariffs, import restrictions, or suspension of CAFTA-DR concessions. The Ortega-Murillo regime is likely to react negatively, viewing the investigation as…”

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