Former U.S. Cold War Foe Ortega Eyes Landslide in Nicaragua

(Bloomberg) -- Nicaraguan President Daniel Ortega is set to win a third consecutive term in office on Sunday after the Supreme Court barred two opposition candidates from running and the U.S. expressed concern over democracy in the impoverished nation.

The man who defied the U.S. as the head of the Sandinistas during the 1980s has the backing of 52 percent of voters, compared with 4 percent for his closest rival, according to a Cid Gallup poll published last week. The other 40 percent say they won't vote for anyone. Ortega's wife, Rosario Murillo, is running alongside him for Vice President.

"Daniel Ortega has completely dominated government and the electoral institutions," said Eric Olson, Associate Director of the Woodrow Wilson Center's Latin American Program. "They're not in economic disaster like Venezuela, they're stable and people become less poor over time, but it comes at a big cost in terms of democracy." 

Almost four decades after his Sandinista movement overthrew the dictatorship of Anastasio Somoza and fought a civil war with U.S.-backed Contras, Ortega continues to have a prickly relationship with the superpower to the north. The U.S. government said in August it was "gravely concerned" about Nicaragua curbing opposition parties, while congress is debating a bill to impede the country's access to multilateral loans. Yet Ortega, 70, who describes his administration as Socialist and Christian, remains popular at home as the economy outpaces regional peers and the nation avoids the gang-fueled crime that has pushed homicide rates in Honduras and El Salvador to among the highest in the world.

The International Monetary Fund forecasts Nicaragua's economy will expand 4.5 percent this year, while the economy of Latin America and the Caribbean as a whole contracts. Nicaragua has bucked the trend of weak growth in the rest of Latin America as cheaper oil prices cut fuel bills and the U.S. recovery boosts remittances.

The poverty rate fell to 29.6 percent in 2014 from 48.3 percent in 2005, according to the World Bank, as Ortega's government expanded access to social services and public housing. Even so, Nicaragua remains the poorest country in the Americas after Haiti.

The government said it plans to finance part of $5.2 billion in public and private investments over the next five years with sovereign bond sales in international markets. A plan to build a $50 billion canal across the country has stalled and the business community has been "getting a lot more anxious" after recent political maneuvers, said Eric Farnsworth, vice-president of the Council of the Americas.

To contact the reporter on this story: Michael McDonald in Guatemala City at mmcdonald87@bloomberg.net. To contact the editors responsible for this story: Vivianne Rodrigues at vrodrigues3@bloomberg.net, Philip Sanders, Matthew Bristow