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What's Happening In Nicaragua

By Opportunity International

Good Samaritans Are Familiar With Risk

We knew facilitating economic development among the poor would not be without risk. The very DNA of microfinance is that it is only needed in places where social and financial safety nets are uncertain. The truth of Opportunity International’s mission is the Good Samaritan is often summoned into action in risky circumstances. Twenty years ago, when Opportunity International Canada began work in Nicaragua, the government was stable, but with a spotty democratic past, military-studded policing and ancient simmering feuds, we knew old tensions could resurface. So we made risk assessments, put safeguards in place for clients, employees and donor investments, then rolled up our sleeves and put our shoulders to the grindstone to help as many as we could with the transformative power of small loans and support.

A Great Impact

Much has been accomplished in Nicaragua. 

According to the World Bank, poverty levels In Nicaragua have dropped from 29.6% to 24.9% of the population in just a few years.

In the last 20 years, Opportunity International has helped some 383,292 Nicaraguans move out of poverty. Starting their own small enterprises, supported by loans and training, they have grown their profits, buoyed their local economies, improved their household health and sent their children to school. In fact, up until December of 2017, of the 27 microfinance organizations operating in Nicaragua, all were experiencing sustained growth, both in loan portfolio and in number of clients, loaning a combined US$558.9 million to 607,171 clients.

An Unexpected Crisis

However, in April 2018, old unrests exploded into new life when Nicaragua’s 72 year old President Daniel Ortega, announced a cutback to social security benefits and an increase in taxes. Immediately hundreds of thousands took to the streets in protest, the incident tapping into broad disgruntlement with Ortega and his wife – also his Vice President. As is often the case, the protests sparked violence, involving police, military and para-military, with no clear end yet in sight.

Partner Update 

A Terrible Cost

The result of the violence is a roll-call of 400 dead, 600 disappeared, and 2,500 injured. Tourism has been cut off completely, hotels and restaurants closed, food production chains blocked. The largest banks in the country have let go over 1,400 staff because of decreased economic activity; and millions of dollars have been withdrawn from the formal banking system. Tens of thousands of Nicaraguans are seeking asylum in neighbouring countries.

“The violence and repression observed in Nicaragua since the protests began in April are the by-product of the systematic erosion of human rights over the years,” stated Zeid Ra’ad Al Hussein, the High Commissioner of the United Nations Commission of Human Rights. Earlier this month, the United States warned the Security Council that Nicaragua is heading down the path of complete collapse.

Crisis Impact

On a personal and financial level, our Nicaraguan partner ASODENIC has felt the impact deeply:

  • They have had to let 35 staff go.
  • They have had to centralize operations, putting the daily operations of 3 branch offices on hold (Sebaco, Boaco and San Rafael) and are centralizing operaitons of 2 other branches (Rivas and Masaya).
  • They are currently only disbursing loans in Managua (US$365K was disbursed in August).
  • 38.95% of their $1.4 million portfolio is in arrears greater than 7 days because clients are unable to operate their businesses.
  • Juan Ulloa, our Nicaraguan Executive Director, shared his oldest son can’t attend university, as universities have been closed since April.

Crisis Births Courage 

And yet... as if often the case in crisis, great courage and commitment has also been on display:

  • Staff members have rallied, tightening their belts, becoming remarkably resourceful.
  • In a demonstration of loyalty, in the last 3 months, the arrears rate in Managua has dropped from almost 30% at the peak of the crisis to 0% after 30 days. Among all offices, of all loans disbursed in the last 3 months, the arrears rate after 30 days is 0.6%
  • Prayer has been a very real focus and comfort.
  • Staff continue to keep in touch with clients to offer support. They believe clients will be able to renegotiate and begin repaying loans quickly once peace is established and businesses can freely operate. “God will open doors and windows where there are none while we are work diligently on this ministry,” said Juan Ulloa
  • ASODENIC board and staff have reaffirmed their commitment to keep operating, however capacity is reduced.

"We are discovering that risk can be significantly mitigated, even during political turmoil, when relationships are strong, commitment is high, and an entrepreneurial spirit is alive,” says Bob Lupton, author of “Toxic Charity” and board member of an American microenterprise in Nicaragua.


Jinotega, a branch office long-supported by Opportunity International Canada, has been hit especially hard by the crisis. A remote northern town tucked between hillsides of coffee plantations, all access to markets and supplies for Jinotega were cut off wihen protests closed roads and highways across the country. Those who dared to travel despite the violence took their life into their own hands. As a result, for the last 3-5 months, people in Jinotega have not been able to get products to either buy or sell, and many businesses have shut down. Surrounding coffee plantations have also struggled to remain in business as numbers of people leaving the countryside for either the city or the more stable Costa Rica have swelled.

In spite of approximately 70% of the Jinotega portfolio being in arrears greater than 7 days ($92,986), clients and ASODENIC staff feel the beginning of the coffee harvest season (November to February) will bring economic activity to the country, which will in turn be reflected in more business activity as cash enters the economy. Executive Director Juan Ulloa has shrunk the staff from 12 to 6, but will maintain the Jinotega office because he believes ASODENIC can help clients renegotiate outstanding loans and perhaps give them additional loans to help them recover.

Masaya and Carazo

ASODENIC branch offices in Masaya and Carazo have also been unable to re-establish opertions as yet. Arrears greater than 30 days are around 60% of portfolio in both ($119,755 Masaya and $158,436 Carazo). Historically, these towns supported the rebel Sandanista movement that ended 46 years of dictatorship in Nicaragua and governed the country from 1979 to 1990. Fearing Masaya was fermenting uprising against the government in the current crisis, Ortega’s military and police acted swiftly to suppress protests in the town. Movement is limited, and residents accuse pro government forces of twice torching the craft artisan markets, a symbol of pride in the city.

Staying the Course

Opportunity International Canada is in almost daily contact with Juan, the CEO of ASODENIC. Offering personal support and prayer, we are carefully monitoring the situation. As staff in Canada, we’ve been to the field and we’re not naïve. We know that doing microfinance is not for the faint of heart. It’s not cheap. It’s not easy. It’s not fast. And it is risky. But on the other hand, it’s the only type of charity that runs on a business model and can help a whole nation recover after hard times by kick-starting local economies.

What You Can Do To Help

Canadian donors can assist our partners in Nicaragua by:

  • Praying for our staff on the field as they try to offer encouragement and support to the poorest of the working poor in a very fraught time.
  • Consider providing loans funds for the Jinotega office to assist clients with the recovery process.
  • Consider providing funding for the ASODENIC Managua office where arrears over 30 days is currently ZERO.

Support Nicaragua 

You can further support or clients in Nicaragua by donating. Donations will go where there is the greatest need.

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