Sandinista Government Seeks Foreign Investments
Aug. 15, 1989
MANAGUA, Nicaragua (AP) _ The Sandinista government said Tuesday it is embarking on a program to attract foreign investments now that an agreement has been reached to disband the U.S.-backed rebels.
In an interview with the Sandinista party newspaper Barricada, Jesus Castilo, director of foreign investment, said the government had begun a publicity campaign designed ''to be an aggressive policy to attract foreign capital.''
He said companies in other Latin American countries, the United States and various European countries had expressed interest.
Castillo said the campaign would emphasize the foreign-investment law enacted in November 1987, which allows total or partial repatriation of profits to other countries, depending on the industry.
Foreign capital also can form joint ventures with Nicaragua's public or private sectors. The leftist government seeks foreign capital in several areas, particularly agriculture.
Castillo said 36 foreign companies operate in Nicaragua, among them Esso, Coca Cola and Pepsi Cola. Esso operates the country's only oil refinery.
A U.S. economic embargo virtually ended the flow of investment capital from the United States and, with the rebel warfare, helped create hyperinflation and severe unemployment.
Inflation was estimated at 20,000 percent last year, but by July the rate had slowed to 8.5 percent a month. Official figures put the unemployment rate at 25 percent of the 1 million-member labor force.
On Aug. 7, President Daniel Ortega and four other Central American presidents agreed that the rebels, known as Contras, should be disbanded.
President Jose Azcona of Honduras said Monday he was convinced Nicaragua had established democratic conditions that would allow the Contras to return to their homeland. Most of the Contras are in bases in Honduras.