Nicaragua Since Iran-Contra

As tension and fighting continued between the Sandinista government and the Contras, the Nicaraguan government attempted to make peace. In September 1984, Nicaragua signed a draft of the Contadora Treaty, which was an attempt by its four sponsors – Mexico, Venezuela, Colombia, and Panama – to stem the armed conflicts happening in Central America. After 20 months of negotiations, the treaty contained provisions for the withdrawal of foreign military advisers, prohibitions of foreign military bases and interference in other countries’ internal affairs, controls on the levels of arms and troops in the region, and support for the establishment of conditions for free elections. As such, the Treaty would prohibit U.S. military bases and advisers in the region and it would require suspension of aid to the Contras. The Reagan administration preferred the removal of the Sandinista government to a Contadora Treaty.1 The Reagan administration encouraged Honduras, El Salvador, and Costa Rica to object to the treaty, arguing that it was unverifiable and favorable to Nicaragua. The Treaty was ultimately abandoned in 1986 with its formal rejection by Nicaragua's neighbors.

As time went on, the Nicaraguan civil war between the Sandinistas and the Contras, coupled with Sandinista economic policy, contributed greatly to economic decline in Nicaragua. Ultimately, the two sides signed a peace deal in 1987, and elections were held in 1990. The Bush administration, which had gradually ended aid to the Contras, gave financial support to the political opposition. Violeta Chamorro (Pedro Joaquín Chamorro’s widow) won the presidency, representing the National Opposition Union. She attempted to reverse many policies of the Sandinista regime, introducing free-market reforms, human rights protections, and democratization. Animosity between former Contras and Sandinistas remained strong – and sometimes violent – through the mid-1990s; however, President Chamorro did make progress toward reconciliation.

In 1997, Arnoldo Aléman became president after winning elections the previous year. His administration suffered from corruption, however, and in 2001, Enrique Bolaños became president. He attempted to bolster Nicaragua’s economy by introducing various reforms. After Bolaños, Daniel Ortega – a former leader of the Sandinistas – returned to the presidency after the 2006 election, though with less of a focus on his socialist priorities of the past. Instead, his “government [will] focus on the difficult task of stamping out official corruption and improving general economic conditions, particularly for poorer Nicaraguans.”

Today, relations between the United States and Nicaragua are normal. Both countries maintain embassies in the other. The United States continues to push for free-market reforms, democratization, and economic improvement. Nicaragua is now part of the Central America-Dominican Republic Free Trade Agreement, a free trade agreement that includes the United States, Nicaragua, the Dominican Republic, Costa Rica, Honduras, Guatemala, and El Salvador.

1Reed Brody, Contra Terror in Nicaragua, Report of a Fact-finding Mission: September 1984-January 1985 (South End Press Collective, 1985), 17.