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Nicaragua: the Heart of Central America, “So small, yet so large”

Nicaragua: the Heart of Central America, “So small, yet so large”. Presentation by Norman Caldera Cardenal Minister of Foreign Affairs München, 30 September 2004. Old advertisement?. I don’t know who you are! I don’t know your region! I don’t know your country!

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Nicaragua: the Heart of Central America, “So small, yet so large”

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  1. Nicaragua: the Heart of Central America, “So small, yet so large” Presentation by Norman Caldera Cardenal Minister of Foreign Affairs München, 30 September 2004

  2. Old advertisement? • I don’t know who you are! • I don’t know your region! • I don’t know your country! • I don’t know your country’s reputation! • Now, where is it that you want me to risk my hard-earned money?

  3. FTAAAfter they discarded LAFTA! • Free Trade Area of the Americas, (North, South, and Central, as well as The Caribbean). • Target date: negotiations end 2005. In force, 2007. • Before events in South America-the Caribbean, (Haiti and, Venezuela.) • Brazil now wants Merco-sur Customs Union and SAFTA ere FTAA.

  4. CAFTA, including Nicaragua • Neither Mexico, nor South America! • 2 ½ hours by air from Miami, Houston or New Orleans. • Shores on the Pacific Ocean and the Caribbean Sea. • 40 million people with access to the largest consumer market in the world!

  5. Was CAFTA*, a return to Geopolitics? *Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica and Dominican Republic. • 2003 Trade with US was over US$ 31 Billion. • 3rd in the Hemisphere after Canada and México. • 1.5 times the sum of Russia, India and Indonesian trade with US. • 7 times as much as US Trade with Chile. • Negotiated 2003, ratified 2004. In force, 2005. • Regional Technology exports to the US are US$ 100 per cápita.

  6. Central America : Exports by Regions 2001 17 % 43% 2% 29% 9%

  7. Central America • 8 elected presidents who know each other well. Saca – 2004-2009 Maduro 2002-2006 Bolaños 2002-2007 Berger 2004-2008 Pacheco 2002-2006 Torrijos 2004 2009 • “Democratic Security”, reasonable balance of forces. • Defense of Human Rights in the hemisphere. • A Customs Union in the Making: late 2004. • Belize, member, Dominican Republic, associate. • Mexico has applied for membership.

  8. Central Americaunder CAFTA • Intellectual Property Rights agreements in place; • Measures to foster Competition, included. • Environmental Regulations in place. • We all have signed the Kyoto Agreement and are partners in CONCAUSA. • TPA asks for enforcement of existing regulations, not new ones. • Labor practices under ILO scrutiny. • Nicaragua, is party to 54 ILO agreements, the US is party to less than 15. • CAFTA legal bridges being built to provide continuous legal highway. • “One of the two most promising regions in the World”: Michael Porter.

  9. NicaraguaSingle digit inflation since 1997 • Completion Point of HIPC reached by IMF 24 Jan 2004. • Safest neighborhoods: lowest crime rate in the region. • B.I.Ts with US, Canada, Netherlands, France, etc., • Nicaraguan “Mountain Grown Coffee” hit world record prices in 2004 internet auction. Over 12 US$ per lb. • Check out our Cigars in “Cigar Aficionado”! • Our Rum “Flor de Caña” is well-known worldwide. • Route 66 Jeans and Docker’s made there! GAP, Old Navy and even Banana Republic are approved by GAP. (not by us, but there is freedom of expression in Nicaragua) • Automobile spare parts for the US market, by Yasaka. • Export supply mix is short, but excel at what we do!

  10. Nicaragua. • Alternative Dispute Settlement Mechanisms (Arbitration) accepted. CIADI, MIGA, Panama, New York. • Anticorruption Drive is the Real McCoy: • Former Finance Vice-Minister condemned 10 years for graft and corruption • Former President condemned 20 years for Money Laundering • Both from the same party as the President. • Tax Collection has gone up. • Our budget is in internet for all to see and follow • Official Development Assistance is also in internet (www.cancilleria.gob.ni/sysoda) • “Nicaragua’s Pacific Coast property is like California but at fraction of the cost.” Business Week 1999.

  11. Japan: 50.0 Switzerland: 36.5 France 35.5 Australia 26.3 US 21.7 Costa Rica 11.8 NICARAGUA 6.9 England 9,927 Germany 7,736 US 4,161 NICARAGUA 1,750 Comparisonsby InterpolSuicide Rate Crime RatePer 100,000 Per 100,000

  12. World: 8.86 Latinamerica: 22.90 El Salvador: 117.00 Guatemala 45.00 New Orleans 43.30 D.C. 41.80 Atlanta 31.70 Chicago 21.90 Costa Rica 7.20 NICARAGUA 3.40 Honduras 9,816 El Salvador 9,378 Costa Rica 5,542 NICARAGUA 3,913 Comparisonsby InterpolMurder Rate Prison InmatesPer 100,000 Per 100,000

  13. Italy: 5.3 Spain: 4.7 Germany 4.4 El Salvador 2.6 Costa Rica 2.5 NICARAGUA *1.2 * 50% unarmed US 682 Canada 123 Scotland 119 Germany 96 NICARAGUA 57 Comparisonsby InterpolPolice Officers PrisonersPer 1,000 Per 100,000

  14. ComparisonsArmy SizeInternational Institute for Strategic Studies • Nicaragua’s Army went from 120,000 to 14,000. (1987-1993) • Number 129 of 132 for military growth. • Nicaragua ranks below Holland in Soldiers for every 1,000 population.

  15. Comparisonby the CIA factbookMilitary spenditure • Mexico: US$ 4 billion • Guatemala: US$ 120 MM • Costa Rica: US$ 69 MM • NICARAGUA US$ 26 MM • Military spending per person: • NICARAGUA US$ 5.18 COSTA RICA: US$ 17.99

  16. WEIGHTED AVERAGE INTEREST RATES

  17. GDP GROWTH % 3.7 2.3 1.0

  18. EXTERNAL DEBT RELIEF - NICARAGUA

  19. Debt Reduction Effort(Million US$)

  20. National VisionNational Development Plan Company Strategy, Structure and Rivalries. • Controlling transaction costs and nurturing a stable Business Environment. • Supporting Cluster Development at the micro-level • 7 Clusters • Foreign Service in Trade and Investment Promotion. • President and Ministers answer e-mail from Investors and Importers. • Presidente@Presidencia.gob.ni • Norman.Caldera@cancilleria.gob.ni Factor Conditions Demand Conditions Related Industries Upstream, downstream

  21. Priority Clusters 2002 LOCATION Unique Natural Resources, Water And Biodiversity Fisheries and Aquaculture Energy Tourism Agribusiness and Food Procesing. Light manufacture and Textiles & Garments Beef and Dairy Products Wooden Furniture and parts Year round Agriculture and Forestry

  22. Who are we?To whom will you be talking? • Enrique Bolaños: President. BSE, Engineering, University of St. Louis. • Norman Caldera: Foreign Minister: BBA, University of Texas, Austin. (McCombs) MIM, VPI. • Mario Arana. Minister of Trade and Industry, Ph.D. Economics, University of Texas, Austin. • Eduardo Montiel. Minister of Finance: DBA Harvard University. • Eduardo Montealegre, MBA, Harvard Business School. Chief of Staff of the President. • José Antonio Alvarado: Minister of Health: J.D. Harvard. • Silvio DeFranco Minister of Education: PDS, Kennedy School, Harvard. • Mario DeFranco: Chief Economic Adviser: PDS, Kennedy School, Harvard. • Carmen Largaespada, Minister of the Family, Ph.D., University of Alberta, Canada • María Dreyfus Ulvert, Trade Commissioner in Miami, MBA, Columbia University. • Guillermo Pérez-Argüello:Chief of Protocol M.A. Oxford. • Lester Mejía: Ambassador to Belgium: Ph.D. International Law, Université de Bordeaux. • Salvador Sacasa, MBA PhD, Candidate. Diplom Econom. Hochschüle für Ökonomie. Berlin. Assistant to FM • Francisco Fiallos: Ambassador to Costa Rica, Master of Law, Harvard Law School. • Salvador Stadthagen: Ambassador to Washington: M.P.A., Kennedy School, Harvard. • José René Gutiérrez Huete, Ambassador to Guatemala, Master of Law, Harvard Law School. • Marco Narváez: President of the National Finance Institute: MBA, U. Chicago. • Frank Kelly: President of the Communications Regulating Board: B.S.E. West Point, MBA Harvard. • Raul Barrios: Delegate to the IDB: MBA, Wharton School of Business, University of Pennsylvania. • Ariel Granera: Adviser to Foreign Minister: M.S. Sorbonne University, Paris. • Mario Flores: Vice-President of Central Bank: M.S. Economics, University of Louvaine, Belgium. • Luis Pereira: Manager, Pro-Nicaragua: MBA, Harvard.

  23. Sampling of Pioneers already in Nicaragua! * United Brands* Nien Hsing Textiles * Greenstone Resources * BATCO * Parmalat* Xerox * Nestle S.A.* Kativo * Fortex Industrial* Chiquita Tropical Products * BellSouth* Texaco. * China United Garments* Barceló Hotels * Shell Oil* Holiday Inn * Hampton Inn* Nabisco * Esso Standard Oil* Bayer • Great King Garments* Unión Fenosa • America Mobil * Swedtel

  24. New answers! • Now you know who we are! • Now, you know about CAFTA! • Now, you know where we are! • I hope you know our reputation! • See you in Managua!!!

  25. THE END

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