Economy of Nicaragua

Nicaragua's economy is focused primarily on the agricultural sector. It is the least developed country in Central America, and the second poorest in the Americas by nominal GDP. In recent years, under the administrations of Daniel Ortega, the Nicaraguan economy has expanded somewhat, following the global recession of 2009, when the country's economy actually contracted by 1.5%, due to decreased export demand in the US and Central American markets, lower commodity prices for key agricultural exports, and low remittance growth. The economy saw 4.5% growth in 2010 thanks to a recovery in export demand and growth in its tourism industry.[6] Nicaragua's economy continues to post growth, with preliminary indicators showing the Nicaraguan economy growing an additional 5% in 2011.[7] Consumer Price inflation have also curtailed since 2008, when Nicaragua's inflation rate hovered at 19.82%.[8] In 2009 and 2010, the country posted lower inflation rates, 3.68% and 5.45%, respectively.[8] Remittances are a major source of income, equivalent to 15% of the country's GDP, which originate primarily from Costa Rica, the United States, and European Union member states. Approximately one million Nicaraguans contribute to the remittance sector of the economy.

In early 2004, Nicaragua secured some $4.5 billion in foreign debt reduction under the International Monetary Fund and World Bank Heavily Indebted Poor Countries initiative. In April 2006, the US-Central America Free Trade Agreement went into effect, expanding export opportunities for Nicaragua's agricultural and manufactured goods. Textiles and apparel account for nearly 60% of Nicaragua's exports. In October 2007, the IMF approved an additional poverty reduction and growth facility program in support of the government's economic plans. Nicaragua relies on international economic assistance to meet internal- and external-debt financing obligations, although foreign donors curtailed this funding in response to widespread allegations of electoral fraud in Nicaragua's November 2008 elections.

Economy of Nicaragua
Managuani
Currency1 cordoba = 0.0418 US dollar
Calendar year
Trade organizations
DR-CAFTA
Statistics
GDPDecrease $13.258 billion (nominal, 2018 est.)[1]
Decrease $35.733 billion (PPP, 2018 est.)[1]
GDP rank130th (nominal, 2018)
115th (PPP, 2018)
GDP growth
4.7% (2016) 4.9% (2017)
-3.8% (2018e) -0.5% (2019f) [2][3]
GDP per capita
Decrease $2,108 (nominal, 2018 est.)[1]
Decrease $5,682 (PPP, 2018 est.)[1]
GDP per capita rank
135th (nominal, 2017)
130th (PPP, 2017)
GDP by sector
agriculture: 15.5%
industry: 24.4%
services: 60% (2017 est.)[3]
5.142% (2019f est.)[1]
4.965% (2018)[1]
3.851% (2017)[1]
Population below poverty line
29.6% (2015 est.)[3]
46.2 high (2014, World Bank)[4]
Labor force
3.046 million (2017 est.)[3]
Labor force by occupation
agriculture: 31%
industry: 18%
services: 50% (2011 est.)[3]
UnemploymentNegative increase 6.4% (2017 est.); underemployment was 46.5% in 2008[3]
Main industries
food processing, chemicals, machinery and metal products, knit and woven apparel, petroleum refining and distribution, beverages, footwear, wood, electric wire harness manufacturing, mining
127th (2017)[5]
External
ExportsIncrease $3.819 billion (2017 est.)[3]
Export goods
coffee, beef, gold, sugar, peanuts, shrimp and lobster, tobacco, cigars, automobile wiring harnesses, textiles, apparel
Main export partners
 United States 44.2%
 El Salvador 6.4%
 Venezuela 5.5%
 Costa Rica 5.5% (2017)[3]
ImportsIncrease $6.613 billion (2017 est.)[3]
Import goods
consumer goods, machinery and equipment, raw materials, petroleum products
Main import partners
 United States 20.8%
 China 14.3%
 Mexico 11.1%
 Costa Rica 7.9%
 Guatemala 7%
 El Salvador 5.6% (2017)[3]
FDI stock
Steady N/A
Steady Abroad: N/A
Increase -$694 million (2017 est.)[3]
Negative increase $11.31 billion (31 December 2017 est.)[3]
Public finances
Negative increase 33.3% of GDP (2017 est.)[3][note 1]
-2% (of GDP) (2017 est.)[3]
Revenues3.871 billion (2017 est.)[3]
Expenses4.15 billion (2017 est.)[3]
Foreign reserves
Increase $2.758 billion (31 December 2017 est.)[3]
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars.

Economic history

Nicaragua's economy was devastated in the 1980s by the Contra War, which saw the destruction of much of the country's infrastructure. At the same time, the US staged an economic blockade from 1985 onward.

Following the civil war, Nicaragua began free market reforms, privatizing more than 350 state companies and commencing a general trend of economic growth. Inflation has been reduced from 33,603% during the later years of the Sandinista period and 55,000% during the first year of the Chamorro government to more normal levels, averaging an annual rate of 9.5% over the 2000-2010 decade (based on World Bank figures).

Growth was slow (3%) in 2001 due to a combination of factors (a global recession, a series of bank failures, low coffee prices, and a drought), and in 2009 the economy actually contracted 1.5% in reaction to the 2008–2012 global recession). But even with the recessions, growth has averaged 3.4% between 2001 and 2011 (again, based on World Bank figures).

Economy

Unemployment is 6.4%.[9] Nicaragua suffers from persistent trade and budget deficits and a high debt-service burden, leaving it highly dependent on foreign assistance—which represented almost 25% of GDP in 2001.

One of the key engines of economic growth has been production for export. Although traditional products such as coffee, meat, and sugar continued to lead the list of Nicaraguan exports, the fastest growth is now in nontraditional exports: textile and apparel; gold; seafood; and new agricultural products such as peanuts, sesame, melons, and onions. In 2007, exports topped $1 billion US dollars for the first time in Nicaraguan history.[10]

Nicaragua is primarily an agricultural country, but construction, mining, fisheries, and general commerce also have been expanding during the last few years. Foreign private capital inflows topped $300 million in 1999 but, due to economic and political uncertainty, fell to less than $100 million in 2001. In the last 12 years, tourism has grown 394%,[11] the rapid growth has led it to become Nicaragua's second largest source of foreign capital. Less than three years ago, the nation’s tourism budget was U.S. $400,000; today, it is over $2 million.[11] Nicaragua's economy has also produced a construction boom,[12] the majority of which is in and around Managua.

Nicaragua faces a number of challenges in stimulating rapid economic growth. An International Monetary Fund (IMF) program is currently being followed, with the aim of attracting investment, creating jobs, and reducing poverty by opening the economy to foreign trade. This process was boosted in late 2000 when Nicaragua reached the decision point under the Heavily Indebted Poor Countries (HIPC) debt relief initiative. However, HIPC benefits were delayed because Nicaragua subsequently fell "off track" from its IMF program. The country also has been grappling with a string of bank failures that began in August 2000. Moreover, Nicaragua continues to lose international reserves due to its growing fiscal deficits.

The country is still a recovering economy and it continues to implement further reforms, on which aid from the IMF is conditional. In 2005, finance ministers of the leading eight industrialized nations (G8) agreed to forgive some of Nicaragua's foreign debt, as part of the HIPC program. According to the World Bank Nicaragua's GDP was around $4.9 US billion dollars. Recently, in March 2007, Poland and Nicaragua signed an agreement to write off $30.6 million which was borrowed by the Nicaraguan government in the 1980s.[13]

The U.S. is the country's largest trading partner, providing 25% of Nicaragua's imports and receiving about 60% of its exports. About 25 wholly or partly owned subsidiaries of U.S. companies operate in Nicaragua. The largest of those investments are in the energy, communications, manufacturing, fisheries, and shrimp farming sectors. Good opportunities exist for further investments in those same sectors, as well as in tourism, mining, franchising, and the distribution of imported consumer, manufacturing, and agricultural goods. There also are copper mines in northeastern Nicaragua.

Gross Domestic Product (GDP) in purchasing power parity (PPP) in 2012 was estimated at $20.04 billion USD, and GDP per capita in PPP at $3,300 USD, making Nicaragua the second poorest country in the Western Hemisphere.[14] The service sector is the largest component of GDP at 56.7%, followed by the industrial sector at 25.8%(2012). Agriculture represents 17.5% of GDP and it's the largest percentage in a Central American country. Nicaraguan labor force is estimated at 2.961 million of which 28% is occupied in agriculture, 19% in the industry sector and 53% in the service sector (2012).

Agriculture and food production

Food and agriculture
Product World rank1
Coffee, green 4
Beans, Dry 17
Groundnuts in Shell 30
Indigenous cattle meat 30
Plantains 32
Sesame Seed 32
Sugar Cane 32
Pineapples 33
Castor Beans 37
Cocoa beans 41
Cassava 48
Oranges 49
Soybeans 50
1Source: FAO (2005) Major Food and Agricultural Commodities and Producers

Coffee became Nicaragua's principal crop in the 1870s, a position it still held in 1992 despite the growing importance of other crops. Cotton gained importance in the late 1940s, and in 1992 was the second biggest export earner. In the early 20th century, Nicaraguan governments were reluctant to give concessions to the large United States banana companies, and bananas never attained the level of prominence in Nicaragua that they reached in Nicaragua's Central American neighbors; bananas were grown in the country, however, and were generally the third largest export earner in the post-World War II period. Beef and animal byproducts, the most important agricultural export for the three centuries before the coffee boom of the late 19th century, were still important commodities in 1992.

From the end of World War II to the early 1960s, the growth and diversification of the agricultural sector drove the nation's economic expansion. From the early 1960s until the increased fighting in 1977 caused by the Sandinista revolution, agriculture remained a robust and significant part of the economy, although its growth slowed somewhat in comparison with the previous postwar decades. Statistics for the next fifteen years, however, show stagnation and then a drop in agricultural production.

The agricultural sector declined precipitously in the 1980s. Until the late 1970s, Nicaragua's agricultural export system generated 40 percent of the country's GDP, 60 percent of national employment, and 80 percent of foreign exchange earnings. Throughout the 1980s, the Contras destroyed or disrupted coffee harvests as well as other key income-generating crops. Private industry stopped investing in agriculture because of uncertain returns. Land was taken out of production of export crops to expand plantings of basic grain. Many coffee plants succumbed to disease.

In 1989, the fifth successive year of decline, farm production declined by roughly 7 percent in comparison with the previous year. Production of basic grains fell as a result of Hurricane Joan in 1988 and a drought in 1989. By 1990 agricultural exports had declined to less than half the level of 1978. The only bright spot was the production of nontraditional export crops such as sesame, tobacco, and African palm oil.

Services

The service sector was estimated to account for 56.8% of the country's GDP, and employs 52% of the active population.[14] This section includes transportation, commerce, warehousing, restaurant and hotels, arts and entertainment, health, education, financial and banking services, telecommunications as well as public administration and defense.

Tourism in Nicaragua is one of the most important industries in the country. It is the second largest source of foreign exchange for the country and is predicted to become the first largest industry in 2007.[15] The growth in tourism has positively affected the agricultural, commercial, finance, and construction industries as well.

Current economic outlook

Nicaragua has transformed itself into one of the safest and fastest-growing countries in North America. A stable, multi-party democracy, Nicaragua has ratified Free Trade Agreements with major markets such as the United States, the Dominican Republic (DR-CAFTA), Taiwan and Mexico, among others. As evidence of continuous efforts in improving the business climate, Nicaragua has been ranked favorably in a variety of independent evaluations.

The 2011 Doing Business Report, published by The World Bank Group, a report that benchmarks various indicators of the investment climate in 183 nations, ranked Nicaragua as the top location in Central America in starting a business, investor protection, and closing a business. Additionally, the country improved in the following categories: ease of doing business, registering property, paying taxes, trading across borders and enforcing contracts.

Data

The following table shows the main economic indicators in 1990–2017.[16]

Year 1990 1995 2000 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
GDP in $
(PPP)
7.92 Bln. 9.91 Bln. 14.94 Bln. 18.07 Bln. 19.33 Bln. 20.85 Bln. 21.99 Bln. 21.43 Bln. 22.65 Bln. 24.58 Bln. 26.65 Bln. 28.42 Bln. 30.31 Bln. 32.12 Bln. 34.07 Bln. 36.28 Bln.
GDP per capita in $
(PPP)
... 2,149 2,739 3,358 3,547 3,776 3,931 3,782 3,947 4,231 4,535 4,779 5,041 5,282 5,540 5,849
GDP growth
(real)
−0.1 % 5.9 % 4.1 % 4.3 % 3.8 % 5.1 % 3.4 % −3.3 % 4.4 % 6.3 % 6.5 % 4.9 % 4.8 % 4.9 % 4.7 % 4.9 %
Inflation
(in Percent)
3,004.1 % 11.1 % 11.5 % 9.6 % 9.1 % 11.1 % 19.8 % 3.7 % 5.5 % 8.1 % 7.2 % 7.1 % 6.0 % 4.0 % 3.5 % 3.9 %
Unemployment rate
(in Percent)
15.5 % 16.9 % 9.8 % 5.6 % 5.3 % 5.0 % 6.2 % 7.0 % 8.0 % 7.5 % 6.8 % 5.3 % 5.6 % 6.0 % 6.2 % 6.1 %
Government debt
(Percentage of GDP)
... ... 95 % 67 % 51 % 31 % 26 % 29 % 30 % 29 % 28 % 29 % 29 % 29 % 31 % 34 %

Other statistics

Household income or consumption by percentage share: lowest 10%: 1.4%; highest 10%: 41.8 (2005)

Industrial production growth rate: 2.4% (2005)

Electricity - production: 2.778 billion kWh (2006)

Electricity - production by source: fossil fuel: 53.43%; hydro: 35.34%; nuclear: 0%; other: 11.23% (1998). A large number of wind turbines have been installed along the SW shore of Lake Nicaragua since, and some geothermal plants have been constructed as well. As of 2013, the breakdown was: fossil fuel: 50%; wind power: 15%; geothermal: 16%, hydropower: 12%, biomass power: 7%.[17]

Electricity - consumption: 2.929 billion kWh (2006)

Electricity - exports: 69.34 million kWh (2006)

Electricity - imports: 0 kWh (2006)

Agriculture - products: coffee, bananas, sugarcane, cotton, rice, corn, tobacco, sesame, soya, beans; beef, veal, pork, poultry, dairy products; shrimp, lobsters

Exports - commodities: coffee, beef, shrimp and lobster, cotton, tobacco, peanuts, sugar, bananas; gold

Imports - commodities: consumer goods, machinery and equipment, raw materials, petroleum products

Currency: 1 gold Cordoba (C$) = 100 centavos

Exchange rates: gold Córdoba (C$) per US$1 – 17.582 (2006), 16.733 (2005), 15.937 (2004), 15.105 (2003), 14.251 (2002)

Price inflation:

See also

Notes

  1. ^ official data; data cover general government debt and include debt instruments issued (or owned) by Government entities other than the treasury; the data include treasury debt held by foreign entities, as well as intragovernmental debt; intragovernmental debt consists of treasury borrowings from surpluses in the social funds, such as retirement, medical care, and unemployment, debt instruments for the social funds are not sold at public auctions; Nicaragua rebased its GDP figures in 2012, which reduced the figures for debt as a percentage of GDP

References

  1. ^ a b c d e f g "World Economic Outlook Database, April 2019". IMF.org. International Monetary Fund. Retrieved 10 April 2019.
  2. ^ "January 2019 Global Economic Prospects -- Darkening Skies p. 84" (PDF). openknowledge.worldbank.org. World Bank. Retrieved 23 March 2019.
  3. ^ a b c d e f g h i j k l m n o p q "The World Factbook". CIA.gov. Central Intelligence Agency. Retrieved 23 January 2019.
  4. ^ "GINI index (World Bank estimate)". data.worldbank.org. World Bank. Retrieved 23 March 2019.
  5. ^ "Ease of Doing Business in Nicaragua". Doingbusiness.org. Retrieved 23 January 2017.
  6. ^ http://www.indexmundi.com/g/g.aspx?c=nu&v=66 IndexMundi Real GDP Growth Rate Chart
  7. ^ http://en.centralamericadata.com/en/article/data/Nicaraguan_Economy_Grows_by_5 Nicaraguan Economy Grows by 5 Percent
  8. ^ a b http://www.indexmundi.com/nicaragua/inflation_rate_(consumer_prices).html Nicaragua Inflation Rates via Consumer Price Index, IndexMundi
  9. ^ https://knoema.com/atlas/Nicaragua/Unemployment-rate
  10. ^ Monstersandcritics.com Archived 29 September 2007 at the Wayback Machine Close scrutiny after President Ortega's first 100 days
  11. ^ a b Rcalvet.com Archived 30 September 2007 at the Wayback Machine Government Gets Tough on Environmental Scofflaws
  12. ^ CostaRicaPages.com Archived 7 April 2007 at the Wayback Machine Nicaragua Information
  13. ^ english.people.com.cn Poland forgives nearly 31 million dollars of debt owed by Nicaragua
  14. ^ a b CIA - The World Factbook - Nicaragua
  15. ^ Canal2tv.com Archived 17 July 2007 at the Wayback Machine Turismo en Nicaragua: aportes y desafios parte I
  16. ^ "Report for Selected Countries and Subjects". Retrieved 8 September 2018.
  17. ^ Renewables Readiness Assessment: Nicaragua
  18. ^ a b https://www.reuters.com/article/economicNews/idUSN0930941520090110

External links

April 2014 Nicaragua earthquake

The April 2014 Nicaragua earthquake occurred on April 10 at 17:27 local time. The earthquake hit about 50 kilometres (31 mi) north of the town of Managua. The shock measured 6.1 on the moment magnitude scale and had a maximum Mercalli intensity of VI (Strong).The earthquake resulted in the death of one person and 266 injured. Over 1500 houses were damaged, and tremors continued for many hours afterwards. The town of Nagarote and nearby villages in the Leon Region were the most affected by the earthquake. In less than a day, another earthquake hit Nicaragua, this time near the city of Granada, at 3:29 local time. The second quake registered at a 6.6 magnitude, however, it did not result in any casualties.

Bolsa de Valores de Nicaragua

Bolsa de Valores de Nicaragua (Stock Exchange of Nicaragua, or BVDN) was created in 1994 and is the only stock exchange operating in Nicaragua.

Central Bank of Nicaragua

The Central Bank of Nicaragua (Spanish: Banco Central de Nicaragua) is the central bank of Nicaragua.

Electricity sector in Nicaragua

Nicaragua is the country in Central America with the lowest electricity generation, as well as the lowest percentage of population with access to electricity. The unbundling and privatization process of the 1990s did not achieve the expected objectives, resulting in very little generation capacity added to the system. This, together with its high dependence on oil for electricity generation (the highest in the region), led to an energy crisis in 2006 from which the country has not fully recovered yet.

Recent figures are available at: http://www.ine.gob.ni/DGE/serieHistorica.html

The Nicaraguan electricity system comprises the National Interconnected System (SIN), which covers more than 90% of the territory where the population of the country lives (the entire Pacific, Central and North zone of the country). The remaining regions are covered by small isolated generation systems. The SIEPAC project will integrate the electricity network of the country with the rest of the Central American countries, which is expected to improve reliability of supply and reduce costs.

Index of Central America-related articles

This is an Index of Central America-related articles. This index defines Central America as the seven nations of Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama.

Index of Nicaragua-related articles

The following is an alphabetical list of topics related to the Republic of Nicaragua.

Nicaragua Canal

The Nicaraguan Canal (Spanish: Canal de Nicaragua), formally the Nicaraguan Canal and Development Project (also referred to as the Nicaragua Grand Canal, or the Grand Interoceanic Canal) was a proposed shipping route through Nicaragua to connect the Caribbean Sea (and therefore the Atlantic Ocean) with the Pacific Ocean. Scientists were concerned about the project's environmental impact, as Lake Nicaragua is Central America's key freshwater reservoir while the project's viability was questioned by shipping experts and engineers.Construction of a canal using the San Juan River as an access route to Lake Nicaragua was first proposed in the early colonial era. The United States abandoned plans to construct a waterway in Nicaragua in the early 20th century after it purchased the French interests in the Panama Canal.

In June 2013, Nicaragua's National Assembly approved a bill to grant a 50-year concession to finance and manage the project to the private HK Nicaragua Canal Development Investment (HKND) headed by Wang Jing, a Chinese billionaire. The concession could have been extended for another 50 years once the waterway was operational.In 2015, media reports suggested the project would be delayed and possibly cancelled because Wang's personal wealth declined greatly as a result of the 2015–16 Chinese stock market crash. "Major works" such as dredging were to take place after the finishing of a Pacific Ocean wharf, whose construction was planned to start in late 2016. The Nicaraguan government failed to present reliable information about whether or not the project can be financed, thus casting doubt over whether it would be completed. The HKND Group stated that financing would come from debt and equity sales and a potential initial public offering (IPO).By May 2017, no concrete action had been reportedly taken constructing the canal and further doubts were expressed about its financing. In February 2018, analysts widely viewed the project as defunct, though the head of the project insisted work was on-going and HKND retained the legal rights to the concession for the canal as well as side projects. Despite HKND vanishing, the Nicaraguan government indicates that it will go ahead with the 908 km2 dry land expropriations anywhere within Nicaragua, under land expropriation Canal Law 840.

Nicaraguan Revolution

The Nicaraguan Revolution (Spanish: Revolución Nicaragüense or Revolución Popular Sandinista) encompassed the rising opposition to the Somoza dictatorship in the 1960s and 1970s, the campaign led by the Sandinista National Liberation Front (FSLN) to violently oust the dictatorship in 1978–79, the subsequent efforts of the FSLN to govern Nicaragua from 1979 until 1990 and the Contra War which was waged between the FSLN-led government of Nicaragua and the United States-backed Contras from 1981-1990.

The Revolution marked a significant period in Nicaraguan history and revealed the country as one of the major proxy war battlegrounds of the Cold War with the events in the country rising to international attention.

The initial overthrow of the Somoza regime in 1978–79 was a bloody affair, and the Contra War of the 1980s took the lives of tens of thousands of Nicaraguans and was the subject of fierce international debate. During the 1980s both the FSLN (a leftist collection of political parties) and the Contras (a rightist collection of counter-revolutionary groups) received large amounts of aid from the Cold War super-powers (respectively, the Soviet Union and the United States).

The Contra War ended after the signing of the Tela Accord in 1989 and the demobilization of the FSLN and Contra armies. A second election in 1990 resulted in the election of a majority of anti-Sandinista parties and the FSLN handing over power.

Nicaraguan córdoba

The córdoba (Spanish pronunciation: [ˈkoɾdoβa], sign: C$; code: NIO) is the currency of Nicaragua. It is divided into 100 centavos.

Nicaraguan fifty-cordoba note

This series 2002 note is purple. On the obverse is Pedro Joaquín Chamorro Cardenal and on the reverse is the fortress of El Castillo de la Inmaculada Concepción.

Nicaraguan five hundred-cordoba note

The Nicaraguan five hundred-cordoba note is the note for Nicaraguan cordoba. This series 2002 note is red. On the obverse is José Dolores Estrada and on the reverse is the Hacienda San Jacinto.

Nicaraguan one hundred-cordoba note

This series 2002 note is Blue. On the obverse is Rubén Darío and on the reverse is the Rubén Darío Theatre located in Managua.

Nicaraguan ten-cordoba note

This series 2002 note is Green. On the obverse is Miguel Larreynaga and on the reverse is Islets of Granada.

Nicaraguan twenty-cordoba note

The Nicaraguan twenty-cordoba note is part of the Nicaraguan paper currency. This series 2002 note is orange. On the obverse is José Santos Zelaya and on the reverse is an Atlantic beach scene.

Outline of Nicaragua

The following outline is provided as an overview of and topical guide to Nicaragua:

Nicaragua – sovereign, representative democratic republic and the most extensive nation in Central America. It is also the least densely populated with a demographic similar in size to its smaller neighbors. The country is bordered by Honduras to the north and by Costa Rica to the south. The Pacific Ocean lies to the west of the country, while the Caribbean Sea lies to the east. Falling within the tropics, Nicaragua sits 11 degrees north of the Equator, in the Northern Hemisphere.

The country's name is derived from Nicarao, the name of the Nahuatl-speaking tribe which inhabited the shores of Lago de Nicaragua before the Spanish conquest of the Americas, and the Spanish word Agua, meaning water, due to the presence of the large lakes Lago de Nicaragua (Cocibolca) and Lago de Managua (Xolotlán), as well as lagoons and rivers in the region.At the time of the Spanish conquest, Nicaragua was the name given to the narrow strip of land between Lake Nicaragua and the Pacific Ocean. Chief Nicarao ruled over the land when the first conquerors arrived. The term was eventually applied, by extension, to the Nicarao or Niquirano groups that inhabited that region.

The Nicarao tribe migrated to the area from northern regions after the fall of Teotihuacán, on the advice of their religious leaders. According to tradition, they were to travel south until they encountered a lake with two volcanoes rising out of the waters, and so they stopped when they reached Ometepe, the largest fresh-water volcanic island in the world.

Political history of Nicaragua

Nicaragua gained its independence in 1821, and after a period of instability, was ruled by the Somoza family from 1927 to 1979.

Tourism in Nicaragua

Tourism in Nicaragua has grown considerably recently, and it is now the second largest industry in the nation. Nicaraguan President Daniel Ortega has stated his intention to use tourism to combat poverty throughout the country.The growth in tourism has positively affected the agricultural, commercial, and finance industries, as well as the construction industry. The results for Nicaragua's tourism-driven economy have been significant, with the nation welcoming one million tourists in a calendar year for the first time in its history in 2010.In mid-2018, tourism in Nicaragua came to a virtual standstill due to the 2018 Nicaraguan protests.

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