What is the NICA Act, or H.R. 1918?

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WASHINGTON, D.C. — The Nicaraguan Investment Conditionality Act, or H.R. 1918, is a bill that outlines a specific set of guidelines necessary for the country to receive assistance from international financial institutions. Corruption has become a major issue, and recently President Ortega has thwarted efforts by the U.S to accurately monitor the situation. In order to properly combat issues such as unfair elections, the NICA Act is designed to encourage government transparency.

With 24 cosponsors, the NICA Act encourages rule of law and an independent judiciary and electoral council in Nicaragua. The U.S wants to establish an independent democracy in order to guarantee free, fair and transparent elections. These efforts would help against corruption and would allow for transparency from the Nicaraguan government. As stated by Hilary Clinton, “the entire electoral process of the country was marred by significant irregularities”.

In a Department of State Human rights report on Nicaragua in 2015, it was found that citizen’s right to vote was restricted through various means such as government intimidation. Freedom of speech and press was not allowed and there was a lack of public access to information.

Due to the manipulation of speech and the restriction of independent media, the people of Nicaragua literally did not know the situation happening within their government. For example, information concerning the budget was not made available and off-budget revenue was not documented.

Back in 2006, the government of Nicaragua entered into a $175 million, five-year compact with the Millennium Challenge Corporation. After seeing the decline in political rights and civil liberties in the country, the MCC deducted $61.5 million from this compact, and eventually ended the agreement completely.

Withdrawing funds and restricting capital does affect a country tremendously, especially when it relies on certain outside sources of income to be able to run its government. The NICA Act specifically restricts funds from being received from certain financial institutions.

A similar bill is H.R 89, which was proposed in February of this year and calls for the Gambia to improve its electoral process. However, the blocking of funds in that situation has gone beyond banks. The region continuously held unfair elections and was beyond the point of economic sanctions.

The NICA Act would manage Nicaragua’s corrupt government like any other country in that similar situation, by first imposing economic constraints to promote a peaceful transition to democracy. In the case of the Gambia, military action was eventually required and the country’s 22-year regime ended this year.

No later than 90 days after the enactment of this act, the secretary of stage would delivery a progress report to Congress. This document would discuss which specific senior government officials have recently engaged in corruption.

The NICA Act allows Nicaragua to adjust the current political situation and various human rights issues through effective transparency, in order to once again obtain the right to receive funds from international financial institutions.

Nick Katsos

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Nick Katsos

Nick writes for The Borgen Project from Tucson, AZ. His academic interests include Psychology and he spent his early days in Greece.

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