|República de Nicaragua
Republic of Nicaragua
|Motto: En Dios Confiamos (Spanish)
"In God We Trust"
|Anthem: "Salve a ti, Nicaragua" (Spanish)
"Hail to Thee, Nicaragua"
(and largest city)
|Recognized regional languages||Miskito, Rama, Sumo, Miskito Coastal Creole, Garifuna, Rama Cay Creole|
|Ethnic groups||69% Mestizo
|Demonym||Nicaraguan, Nica, Pinolero|
|-||President||Daniel Ortega (FSLN)|
|-||Vice President||Jaime Morales Carazo|
|Independence||from Spain and Mexico|
|-||Declared||15 September 1821|
|-||Recognized||25 July 1850|
|-||from the First Mexican Empire||July 1, 1823|
|-||Revolution||19 July 1979|
|-||Current constitution||9 January 1987|
|-||Total||130,373 km² (97th)
50,193 sq mi
|-||2010 Census estimate||5,891,199 (110th)|
|GDP (PPP)||2010 estimate|
|-||Total||$17.711 billion (132nd)|
|-||Per capita||$3,045 (167th)|
|GDP (nominal)||2010 estimate|
|Gini (2007)||40.1 (medium)|
|1||English and indigenous languages on Caribbean coast are also spoken.|
|2||Significant proportion of information obtained from CIA World Fact Book|
Nicaragua (Spanish: República de Nicaragua, is a democratic republic in Central America. It is the largest nation in the isthmus, but also the least densely populated with a demographic similar in size to its smaller neighbors. The country is bordered on the north by Honduras and on the south by Costa Rica. Its western coastline is on the Pacific Ocean, while the east side of the country is on the Caribbean Sea.
The country's name is derived from "Nicarao," the name of the Nahuatl-speaking tribe which inhabited the shores of Lago de Nicaragua before the Spanish conquest of the Americas; and the Spanish word Agua, meaning water, due to the presence of the large lakes such as Lago de Nicaragua (Cocibolca) and Lago de Managua (Xolotlán), as well as lagoons and rivers in the region.
Nicaragua was engaged in a civil war for over two decades, which resulted in the overthrow of Anastasio Somoza by the Marxist Sandinista guerrillas in 1979. Previously ruled by the dictatorial Somoza family from 1937 to 1979, government control was seized by the Sandinistas following a popular revolt. The United States, under President Ronald Reagan, concerned by Nicaragua's close relationship with the Soviet Union and Cuba as well as its aid to leftist rebels in El Salvador, began supporting counterrevolutionary military forces, or Contras, in 1981. Sandinista rule ended in 1990 and somewhat more democratic regimes followed. However, former Sandinista President Daniel Ortega won Nicaragua's 2006 presidential election at a time when several other left-leaning regimes have appeared in Latin America.
Nicaragua is one of the hemisphere's poorest countries, resulting in part from difficulty in recovering from civil war and unjust rule.
Located in the west of the country, these lowlands consist of a broad, hot, fertile plain. Punctuating this plain are several large volcanoes of the Marrabios mountain range, including Mombacho just outside Granada, and Momotombo near León. The lowland area runs from the Gulf of Fonseca to Nicaragua's Pacific border with Costa Rica south of Lake Nicaragua. Lake Nicaragua is the second largest freshwater lake in Latin America (twentieth largest in the world), and is home to the world's only freshwater sharks (Nicaraguan shark). The Pacific lowlands region is the most populous, with about 90 percent of the nation's population.
In addition to its beach and resort communities, the Pacific Lowlands is also the repository for much of Nicaragua's Spanish colonial heritage. Cities such as Granada and León abound in colonial architecture and artifacts. Granada, founded in 1524 is the oldest city founded by Europeans in Central America and the second on the American Continent (after Cumaná in Venezuela, founded in 1515).
This is an upland region away from the Pacific coast, with a cooler climate than the Pacific Lowlands. About a quarter of the country's agriculture takes place in this region, with coffee grown on the higher slopes. Oaks, pines, moss, ferns and orchids are abundant in the cloud forests of the region.
This large rainforest region, with several large rivers running through it, is very sparsely populated. The Rio Coco forms the border with Honduras to the north. The Caribbean coastline is much more sinuous than its generally straight Pacific counterpart. Lagoons and deltas make it very irregular.
Nicaragua's Bosawas Biosphere Reserve is located in the Atlantic lowland and protects 1.8 million acres of Mosquitia forest—almost seven percent of the country's area—making it the second largest Biosphere in the Western Hemisphere, and the largest reserve north of the Amazon in Brazil.
Nicaragua's tropical east coast is very different from the rest of the country. The climate is predominantly tropical, with high temperature and high humidity. Around the area's principal city of Bluefields, English is widely spoken along with the official Spanish. The population there more closely resembles that found in many typical Caribbean ports than it does the rest of Nicaragua.
A great variety of birds can be observed including eagles, turkeys, toucans, parakeets and macaws. Animal life in the area includes different species of monkeys, anteaters, white-tailed deer and tapirs.
In pre-Columbian times, in what is now known as Nicaragua, the indigenous people were part of the Intermediate Area, between the Mesoamerican and Andean cultural regions, and within the influence of the Isthmo-Colombian area. It was the point where the Mesoamerican and South American native cultures met. This is confirmed by the ancient footprints of Acahualinca, along with other archaeological evidence, mainly in the form of ceramics and statues made of volcanic stone, such as the ones found on the island of Zapatera in Lake Nicaragua and petroglyphs found on Ometepe island. The Pipil migrated to Nicaragua from central Mexico after 500 B.C.E.
At the end of the fifteenth century, western Nicaragua was inhabited by several indigenous peoples related by culture to the Mesoamerican civilizations of the Aztec and Maya, and by language to the Mesoamerican Linguistic Area. They were primarily farmers who lived in towns, organized into small kingdoms.
Meanwhile, the Caribbean coast of Nicaragua was inhabited by other peoples, mostly Chibcha language groups. They had coalesced in Central America and migrated also to present-day northern Colombia and nearby areas. They lived a life based primarily on hunting and gathering. Joined by waters, the people of eastern Nicaragua traded with, and were influenced by, other native peoples of the Caribbean. Round thatched huts and canoes, both typical of the Caribbean, were commonly crafted and used in eastern Nicaragua.
In the west and highland areas, occupying the territory between Lake Nicaragua and the Pacific Coast, the Niquirano were governed by chief Nicarao, or Nicaragua. The wealthy ruler lived in Nicaraocali, site of the present-day city of Rivas. The Chorotega lived in the central region of Nicaragua. Without women in their parties, the Spanish conquerors took Niquirano and Chorotega wives and partners, beginning the multi-ethnic mix of native and European stock now known as mestizo, which constitutes the great majority of population in western Nicaragua. Within three decades after European contact, what had been an estimated Indian population of one million plummeted. Scientists and historians estimate approximately half of the indigenous people in western Nicaragua died from the rapid spread of new infectious diseases carried by the Spaniards, such as smallpox and measles, to which the Indians had no immunity. The indigenous people of the Caribbean coast escaped the epidemics due to the remoteness of their area. Their societies continued more culturally intact as a result.
In 1502 Christopher Columbus was the first European known to have reached what is now Nicaragua as he sailed south along the Central American isthmus. On his fourth voyage, Columbus sailed alongside and explored the Mosquito Coast on the east of Nicaragua. However, it was not until 1524, that Conquistador Francisco Hernández de Córdoba founded the first permanent Spanish settlements, including two of Nicaragua's principal towns: Granada on Lake Nicaragua, León east of Lake Managua and also Nueva Segovia in northern Nicaragua. Settled as a colony of Spain within the kingdom of Guatemala in the 1520s, Nicaragua became a part of the Mexican Empire and then gained its independence as a part of the United Provinces of Central America in 1821 and as an independent republic in its own right in 1838.
The Mosquito Coast based on Bluefields on the Atlantic was claimed by the United Kingdom and its predecessors as a protectorate from 1655 to 1850; this was delegated to Honduras in 1859 and transferred to Nicaragua in 1860, though it remained autonomous until 1894. Jose Santos Zelaya managed to negotiate with the Britain's Queen Victoria for the annexation of this region to the rest of Nicaragua. In his honor the entire region was named Zelaya, though this was later changed under the Sandinista government and was divided into two autonomous regions.
Nicaragua was considered by the Spanish Kingdom as a very important colony, considering it had a natural route in which it would permit transportation of goods from the Atlantic Ocean to the Pacific. However, at the time it was not considered of much value for the mining of minerals. Although there were high concentrations of gold, they were smaller compared to the amounts in the other Spanish colonies. During the early years of the colony, Nicaragua produced many goods which gave it some prosperity, and there was an ever increasing desire to build a canal along the San Juan River, through Lake Nicaragua and across the isthmus of Rivas.
In the 1800s Nicaragua experienced a wave of immigration, primarily from Europe. In particular, families from Germany, Italy, Spain, France and Belgium moved to Nicaragua generally to set up businesses with money they brought from Europe. They established many agricultural businesses such as coffee and sugar cane plantations, and also newspapers, hotels and banks.
In the late 1800s, the United States government negotiated with President Jose Santos Zelaya to lease land so it could build a canal through Nicaragua. Luis Felipe Corea, the Nicaraguan minister in Washington, wrote to United States Secretary of State John Hay expressing support of such a canal by the Zelaya government. The Sánchez-Merry Treaty with Nicaragua was signed in case the negotiations of a canal through Colombia fell through, although it was later rejected by John Hay. In the end the Spooner Act (which proposed a canal through Panama) was presented before Corea completed a draft of the Nicaragua canal. In addition to the earlier completion of the Panama Canal proposal, opponents of the Nicaraguan canal suggested Momotombo posed a threat of volcanic activity, as depicted on a Nicaraguan stamp, though it was far away from the site. They favored construction of a canal through the isthmus of Panama.
Much of Nicaragua's early politics following independence was characterized by the rivalry between the liberal elite of León and the conservative elite of Granada. This rivalry sometimes spilled into civil war. Initially invited by the liberals in 1855 to join their struggle against the conservatives, a U.S.-born adventurer named William Walker won the Liberals' war so easily that it seemed like he barely even fought. As a result, he saw the chance to take over the country. Walker appointed himself as president in 1856. Fearing the possibility of his plans for expansion, several Central American countries united to drive him out of Nicaragua in 1857, ironically supported by American industrialist Cornelius Vanderbilt, who had earlier sponsored Walker. Walker was executed in neighboring Honduras in 1860. A period of three decades of conservative rule ensued.
Taking advantage of divisions within the conservative ranks, José Santos Zelaya led a liberal revolt that brought him to power in 1893. Zelaya ended the long-standing dispute with the United Kingdom over the Atlantic Coast in 1894, and incorporated the Mosquito Coast into Nicaragua.
Nicaragua has also experienced lengthy periods of military dictatorship, the longest one being the rule of the Somoza family for much of the 20th century. The Somoza family came to power as part of a US-engineered pact in 1927 that stipulated the formation of the National Guard to replace the small individual armies that had long reigned in the country. The only Nicaraguan general to refuse to sign this pact (el tratado del Espino Negro) was Augusto César Sandino who headed up to the northern mountains of Las Segovias, where he fought the U.S. Marines for over five years.
After the U.S. Marines withdrew from Nicaragua in January 1933, Sandino and the newly-elected Sacasa government reached an agreement by which he would cease his guerrilla activities in return for amnesty, a grant of land for an agricultural colony, and retention of an armed band of 100 men for a year.
There followed a growing hostility between Sandino and Anastasio Somoza Garcia, chief of the national guard, which prompted Somoza to order the assassination of Sandino.  Fearing future armed opposition from Sandino, Somoza invited him to a meeting in Managua, where Sandino was assassinated on February 21, 1934 by the National Guard. Following the death of Sandino was the execution of hundreds of men, women, and children.
With Sandino's death and using his troops, the National Guard, to force Sacasa to resign, Somoza had taken control of the country in 1937 and destroyed any potential armed resistance. Somoza was in turn assassinated by Rigoberto López Pérez, a Nicaraguan poet, in 1956. Luis Somoza Debayle, the eldest son of the late dictator, officially took charge of Nicaragua after his father's death.
Luis Somoza, remembered by some for being moderate, was in power for only for a few years before dying of a heart attack. Then came president Rene Schick whom most Nicaraguans viewed "as nothing more than a puppet of the Somozas." Somoza's brother, Anastasio Somoza Debayle, who succeeded his father in charge of the National Guard, held control of the country, and officially took the presidency after Schick.
In 1961, a young student, Carlos Fonseca, turned back to the historical figure of Sandino, and founded the Sandinista National Liberation Front (FSLN), which was an insurrection movement. Somoza's utter hatred of the FSLN and heavy-handed treatment of anyone he suspected to be a Sandinista sympathizer gave many ordinary Nicaraguans the idea that the Sandinistas were much stronger than was the case. Little did anyone realize at the time that this small group would change Nicaragua's history so drastically.
Nicaragua experienced economic growth during the 1960s and early 1970s largely as a result of industrialization, and became one of Central America's most developed nations despite its political instability. Due to its stable and high growth economy, foreign investments grew, primarily from U.S. companies such as Citigroup, Bank of America, Sears, Westinghouse, and Coca Cola.
However, the capital city of Managua suffered a major earthquake on December 23, 1972, which claimed up to 10,000 lives, left 300,000 homeless, and forever changed the character of the capital. In some ways, Nicaragua is still recovering from that disaster. 
Some Nicaraguan historians point to the 1972 earthquake that devastated Managua as the final nail in the coffin for Somoza. Some 90 percent of the city was destroyed, and Somoza's brazen corruption, mishandling of relief (which prompted Pittsburgh Pirates star Roberto Clemente to personally fly to Managua on December 31, 1972 – a flight that ended in a tragic plane crash and his death). The refusal to rebuild Managua flooded disaffection among the ranks of young Nicaraguans who no longer had anything to lose.
In 1973 (the year of reconstruction) many new buildings were built, but the level of corruption in the government prevented further growth, and the ever increasing tensions and anti-government uprisings slowed growth in the last two years of the Somoza dynasty.
Somoza acquired monopolies in industries that were key to rebuilding the nation, not allowing other members of the upper class to share the profits that would result from the reborn economic activity. This weakened Somoza further, since even the economic elite were reluctant to support him. In 1976 a synthetic brand of cotton, one of Nicaragua's economic pillars of the epoch, was developed. This caused the price of cotton to decrease, placing the economy in great trouble.
The Sandinistas used these economic problems to propel themselves in their struggle against Somoza by leading many middle and upper class Nicaraguans to see the Sandinistas as the only hope for ridding the country of the Somoza regime.
The January 1978 assassination of Pedro Joaquin Chamorro, the editor of La Prensa, the most important and influential newspaper in Nicaragua, and an ardent opponent of Somoza, is believed to have been the spark that that led to extreme general discontent against Somoza. It is said that the intellectual planners and perpetrators of the murder were at the highest echelons of the Somoza regime. However, it is also thought that Sandinistas could have planned and carried out the murder with the intention of inciting chaos and gaining the support of the population in a revolution.
Following Chamorro’s murder, an estimated 30,000 people rioted in the streets of Managua. Cars were set on fire and several buildings belonging to the Somoza family were attacked. Outside the capital, unrest flared in a number of cities and towns, particularly in areas where National Guardsmen had massacred peasant farmers during the counterinsurgency effort. The government responded with further violence and reintroduced martial law censorship. During 1978, there were seven machine gun attacks and attempted bombings of La Prensa, then under the management of Chamorro’s widow, Violeta Barrios de Chamorro.
On June 4, 1979 a general strike was called by the FSLN to last until Somoza fell and an uprising was launched in Managua. On June 16, the formation of a provisional Nicaraguan government in exile, consisting of a five-member Junta of National Reconstruction, was announced and organized in Costa Rica. The members of the new junta were Daniel Ortega Saavedra, Moisés Hassan Morales, Sergio Ramírez Mercado, Alfonso Robelo Callejas and Violeta Barrios de Chamorro, the widow of La Prensa's editor Pedro Joaquín Chamorro Cardenal. By the end of that month, with the exception of the capital, most of Nicaragua was under FSLN control, including León and Matagalpa, the two largest cities in Nicaragua after Managua.
The Sandinistas, supported by a populace desperate for change, elements of the Catholic Church, and regional and international governments, took power in July 1979. Somoza would abandon the country and eventually ended up in Paraguay, where he was assassinated in September 1980, allegedly by members of the Argentinian Revolutionary Workers Party.
The provisional government in exile released a government program on July 9 in which it pledged to organize an effective democratic regime, promote political pluralism and universal suffrage, and ban ideological discrimination—except towards those promoting the "return of Somoza's rule." Anastasio Somoza Debayle resigned on July 17, 1979, handed over power to Francisco Urcuyo Maliaños, and fled first to Miami. It was meant that Urcuyo would in turn transfer the government to the revolutionary junta. This agreement was ignored by Urcuyo, who intended to remain in power until the end of Somoza's presidential term in 1981. Two days later Urcuyo left power and fled to Guatemala.
On July 19, 1979 the FSLN army entered Managua, culminating the Nicaraguan revolution. The insurrection left approximately 50,000 dead and 150,000 Nicaraguans in exile. The five-member junta entered the Nicaraguan capital the next day and assumed power, reiterating its pledge to work for political pluralism, a mixed economic system, and a nonaligned foreign policy. 
By 1980, conflicts began to emerge between the Sandinista and non-Sandinista members of the governing junta. Violeta Chamorro and Alfonso Robelo resigned from the governing junta in 1980, and rumors began that members of the Ortega junta would consolidate power amongst themselves. These allegations spread, and rumors intensified that it was Ortega's goal to turn Nicaragua into a state modeled after Cuban communism. In 1979 and 1980, former Somoza supporters and ex-members of the widely discredited and despised National Guard formed irregular military forces, while the original core of the FSLN began to splinter. Armed opposition to the Sandinista government eventually divided into two main groups: The Fuerza Democratica Nicaraguense (FDN), a U.S. proxy army formed in 1981 by the CIA, U.S. State Department, and former members of the widely condemned Somoza-era Nicaraguan National Guard; and the Alianza Revolucionaria Democratica (ARDE), a group that had existed since before the FSLN and was led by a Sandinista founder and former FSLN supreme commander, Eden Pastora. Although independent and often at conflict with each other, these guerrilla bands—along with a few others—all became generally known as "Contras" (short for "contrarrevolucionarios" or "counter-revolutionaries"). Despite the common name, the two primary groups, ARDE and FDN, rarely cooperated with each other and (in part because of the FDN's brutal and vicious terrorist tactics) largely despised one another.
Upon assuming office in 1981, U.S. President Ronald Reagan condemned the FSLN for joining with Cuba in supporting Marxist revolutionary movements in other Latin American countries such as El Salvador. His administration authorized the CIA to begin financing, arming and training rebels, some of whom were the remnants of Somoza's National Guard. This was shortened to Contras, a label the anti-Communist forces chose to embrace. Eden Pastora and many of the indigenous guerrilla forces, who were not associated with the "Somozistas," also resisted the Sandinistas.
The Contras operated out of camps in the neighboring countries of Honduras to the north and Costa Rica to the south. As was typical in guerrilla warfare, they were engaged in a campaign of economic sabotage in an attempt to combat the Sandinista government and disrupted shipping by planting underwater mines in Nicaragua's Corinto Harbour. The U.S. also sought to place economic pressure on the Sandinistas, and the Reagan administration imposed a full trade embargo.
The years 1979 to 1990 were years of extreme deprivation for Nicaragua. The Sandinista government controlled every aspect of people's lives. All imports were drastically reduced due to the lack of foreign exchange and the trade embargo imposed by the United States. Electricity and water was rationed which kept people living on the edge. Food rations were imposed and artificial food shortages were created. The Sandinistas seized land and property from the upper classes and many of them fled overseas during this time period. Young men were drafted to the Sandinista army as young as 14 years old and forced to fight against the Contras.
Censoring of media was imposed. La Prensa, Nicaragua’s leading newspaper was heavily censored and when an article was not approved, the paper would have a blank area where censored articles were deleted before going to print.
The economic situation in the country became increasingly dismal and inflation during this period was out of control. Transportation was a disaster as was the country's situation as a whole.
During the 1984 elections other parties were permitted aside from the FSLN, however people were led to believe that the FSLN knew who people voted for, and this fear led the FSLN to return to power.
The people's hope for a better Nicaragua was never realized with the FSLN. Multi-party democratic elections were held in 1990, which saw the defeat of the Sandinistas by a coalition of anti-Sandinista (from the left and right of the political spectrum) parties led by Violeta Chamorro. The defeat shocked the Sandinistas as numerous pre-election polls had indicated a sure Sandinista victory and their pre-election rallies had attracted crowds of several hundred thousand people.
Violeta Chamorro was the first woman to be popularly elected as President of a Latin American nation and first woman president of Nicaragua. Exit polling convinced Daniel Ortega that the election results were legitimate, and were instrumental in his decision to accept the vote of the people and step down rather than void the election. Nonetheless Ortega vowed that he would govern "desde abajo" (from below), in other words due to his widespread control of institutions and Sandinista individuals in all government agencies, he would still be able to maintain control and govern even without being president.
The time period of transition between the Sandinista government and Violeta Chamorro was called “la piñata.” This was an extremely low point in Nicaragua’s history in which the outgoing Sandinista government turned a blind eye to stealing of government property, leaving the government’s infrastructure in shambles.
Chamorro received an economy entirely in ruins. The per capita income of Nicaragua had been reduced by over 80 percent during the 1980s, and a huge government debt which ascended to US$12 billion. Much to the surprise of the US and the Contra forces, Chamorro did not dismantle the Sandinista People's Army, though the name was changed to the Nicaraguan Army. Chamorro's main contribution to Nicaragua was the disarmament of groups in the northern and central areas of the country. This provided stability that the country had lacked for over ten years.
In subsequent elections in 1996, Daniel Ortega and the Sandinistas of the FSLN were again defeated, this time by Arnoldo Alemán of the Constitutional Liberal Party (PLC).
In the 2001 elections, the PLC again defeated the FSLN, with Enrique Bolaños winning the Presidency. However, President Bolaños subsequently brought forward allegations of money laundering, theft and corruption against former President Alemán. The ex-president was sentenced to 20 years in prison for embezzlement, money laundering, and corruption. The Liberal members who were loyal to Alemán and also members of congress reacted angrily, and along with Sandinista parliament members stripped the presidential powers of President Bolaños and his ministers, calling for his resignation and threatening impeachment.
The Sandinistas alleged that their support for Bolaños was lost when US Secretary of State Colin Powell told Bolaños to keep his distance from the FSLN. The FSLN once again instigated havoc, chaos and violent protest against the Bolaños administration primarily on the streets of Managua.  This "slow motion coup" was averted partially due to pressure from the Central American presidents who would fail to recognize any movement that removed Bolaños; the U.S, OAS, and the European Union also opposed the "slow motion coup."  The proposed constitutional changes that were going to be introduced in 2005 against the Bolaños administration were delayed until January 2007 following the entrance of the new government. One day before they were to be enforced the National Assembly postponed their enforcement until January 2008.
Legislative and presidential elections took place on November 5, 2006. Daniel Ortega returned to the presidency with 37.99 percent of the vote. This percentage was enough to win the presidency outright as a result of a change in electoral law which lowered the percentage necessary to avoid a runoff election from 45 percent to 35 percent (with a 5 percent margin of victory).
Politics of Nicaragua takes place in a framework of a presidential representative democratic republic, whereby the President of Nicaragua is both head of state and head of government, and of a pluriform multi-party system. Executive power is exercised by the government. Legislative power is vested in both the government and the National Assembly. The Judiciary is independent of the executive and the legislature.
Nicaragua's is an agrarian economy that has historically been based on the export of cash crops such as bananas, coffee, sugar, beef and tobacco. Agriculture constitutes 60 percent of its total exports which annually yield approximately US $300 million. In addition, Nicaragua's Flor de Caña rum is renowned as among the best in Latin America, and its tobacco and beef are also well regarded.
During the time the Sandinistas were in power in the 1980s, much of the country's infrastructure was damaged or destroyed. Inflation averaged 30 percent throughout the 1980s. After the United States imposed a trade embargo in 1985, Nicaragua's inflation rate rose dramatically. The 1985 annual rate of 220 percent tripled the following year and skyrocketed to more than 13,000 percent in 1988, the highest rate for any country in the Western Hemisphere that year. Since the end of the Sandinista rule almost two decades ago, more than 350 state enterprises were privatized, reducing inflation from 13,500 percent to 9.6 percent, and cutting the foreign debt in half.
Though sources give slightly differing data on the country's gross domestic product (GDP), Nicaragua ranks among the poorest countries in the Western Hemisphere, along with Bolivia, Honduras and Haiti. According to the CIA World Factbook, inflation averaged 8.1 percent from 2000 through 2006. Nicaragua ranks 39th highest for inflation in the world. The World Bank also indicates moderate economic growth at an average of 5 percent from 1995 through 2004. In 2005 the economy grew 4 percent, with overall GDP reaching $4.91 billion. The reduction in inflation, economic growth and privatization has not helped with Nicaragua's many social issues. 48 percent of the population in Nicaragua live below the poverty line, unemployment is 3.8 percent, and another 46.5 percent are underemployed (2006 est.).
As in many other developing countries, a large segment of the economically poor in Nicaragua are women. In addition, a relatively high percentage of Nicaragua's average homes have a woman as head of household: 39 percent of urban homes and 28 percent of rural homes.
The country is still a recovering economy and it continues to implement further reforms, on which aid from the IMF is conditional. In 2005, finance ministers of the leading eight industrialized nations (G-8) agreed to forgive some of Nicaragua's foreign debt, as part of the HIPC program. According to the World Bank, Nicaragua's GDP was around $4.9 US billion dollars. In March 2007, Poland and Nicaragua signed an agreement to write off 30.6 million dollars which was borrowed by the Nicaraguan government in the 1980s.
The Nicaraguan unit of currency is the Córdoba (NIO) and was named after Francisco Hernández de Córdoba, its national founder.
Gross Domestic Product (GDP) in purchasing power parity (PPP) in 2006 was estimated at $16.83 billion USD  The service sector is the largest component of GDP at 56.8 percent, followed by the industrial sector at 26 percent (2006 est.). Agriculture represents only 17.3 percent of GDP (2006 est.). Nicaraguan labor force is estimated at 2.261 million of which 29 percent is occupied in agriculture, 19 percent in the industry sector and 52 percent in the service sector (2003 est.).
Nicaragua has a population of 5,675,356 (July 2007 est.). Whites and Mestizos make up the majority (86 percent) of the population of Nicaragua with approx. 69 percent Mestizos and 17 percent Caucasian (mostly of Spaniard, German, Italian, or French ancestry), making it the country with the second largest white population in Central America.
Nicaraguan demographics reflected a different composition prior to the Sandinista revolution of 1979 since most of the migration during the years that followed were primarily of upper or middle class Nicaraguans, comprised primarily of whites. A growing number of these expatriates have been returning, though a significant number remain living abroad.
In the nineteenth century, there was a substantial indigenous minority, but this group was also largely assimilated culturally into the mestizo majority. Primarily in the nineteenth century, Nicaragua saw several waves of immigration from other European nations. In particular the northern cities of Esteli, Jinotega and Matagalpa have significant fourth generation Germans. Most of Nicaragua's population lives in the western region of the country in the departments of Managua, Granada and Leon.
About nine percent of Nicaragua's population is black, or Afro-Nicaragüense, and mainly reside on the country's sparsely populated Caribbean or Atlantic coast. The black population is mostly of West Indian (Antillean) origin, the descendants of indentured laborers brought mostly from Jamaica and Haiti when the region was a British protectorate. Nicaragua has the second largest black population in Central America after Panama. There is also a smaller number of Garifuna, a people of mixed Carib, Angolan, Congolese, and Arawak descent.
The remaining five percent comprises the unmixed descendants of the country's indigenous inhabitants. Nicaragua's pre-Colombian population consisted of the Nahuatl-speaking Nicarao people of the west after whom the country is named, and six other ethnic groups including the Miskitos, Ramas and Sumos peoples along the Caribbean coast. While very few pure-blooded Nicarao people still exist, the Caribbean peoples have remained distinct. In the mid-1980s, the government divided the department of Zelaya—consisting of the eastern half of the country—into two autonomous regions and granted the African and indigenous people of this region limited self-rule within the Republic.
There is also a small Middle Eastern-Nicaraguan community of Syrian, Armenian, Palestinian, Jewish and Lebanese people in Nicaragua with a total population of about 30,000, and an East Asian community of Japanese, Taiwanese and Chinese people of almost eight thousand. The Chinese arrived in the late 19th century but their numbers were unsubstantiated until the second census (in 1920) revealed four hundred people of the Chinese nationality.
Ninety percent of Nicaraguans live in the Pacific lowlands and the adjacent interior highlands. The population is 54 percent urban and an estimated 1.4 million Nicaraguans live outside of Nicaragua.
The country has strong folklore, music and religious traditions, deeply influenced by European culture but enriched with Amerindian sounds and flavors. Nicaragua has historically been an important source of poetry in the Hispanic world, with internationally renowned contributors, the best known being Rubén Darío. Also included in this group are Ernesto Cardenal, Gioconda Belli, Jose Coronel Urtecho and Pablo Antonio Cuadra.
Nicaraguan culture can further be defined in several distinct strands. The west of the country was colonized by Spain and its people are predominantly Mestizo or European in composition. Spanish is invariably their first language.
The eastern half of the country, on the other hand, was once a British protectorate. English and indigenous languages predominate in this region and are spoken domestically along with Spanish. Its culture is similar to that of Caribbean nations that were or are British colonies, such as Jamaica, Belize and the Cayman Islands. Recent immigration by mestizos has largely influenced younger generations and an increasing number of people are either bilingual at home or speak Spanish only. There is a relatively large population of people of mixed African descent, as well as a smaller Garifuna population. Due to the African influence, in the Caribbean Coast, there is a different kind of music. It is the popular dance music called Palo de Mayo, or Maypole, which is celebrated during the Maypole Festival, during the month of May. The music is sensual with intense rhythms. The celebration is derived from the British Maypole for May Day celebration, as adapted and transformed by the Afro-Nicaraguans on the Caribbean Coast.
Of the cultures that were present before European colonization, the Nahuatl-speaking peoples who populated the west of the country have essentially been assimilated into the Latino culture. In the east, however, several indigenous groups have maintained a distinct identity. The Miskito, Sumo, and Rama peoples still use their original languages, and also usually speak English and/or Spanish. The Garifuna people speak their own Garifuna language in addition to English and/or Spanish.
Spanish is spoken by 90 percent of the country's population. In Nicaragua the Voseo form is common, just as in other countries in Central and South America like Honduras, Argentina, Uruguay and Ecuador. Spanish has many different dialects spoken throughout Latin America, Central American Spanish is the dialect spoken in Nicaragua. The black population of the east coast region have English as their first language. Several indigenous peoples of the east still use their original language, the main languages being Miskito language, Sumo language, and Rama language. Also, due to the arrival of the Chinese in the nineteenth century, there are an estimated seven thousand people who speak Chinese. Nicaraguan Sign Language is of particular interest to linguists.
Nicaragua is nominally Roman Catholic, but practicing Roman Catholics are no longer the majority and are declining while evangelical Protestant groups including Mormons are growing rapidly. There are strong Anglican and Moravian communities on the Caribbean coast.
The 2005 census shows religious affiliation as follows: Roman Catholic 58.5 percent (most non-practicing), Evangelical 21.6 percent, Moravian 1.6 percent, Jehovah's Witnesses 0.9 percent, none 15.7 percent, and other 1.6 percent (which includes Buddhism, Islam, and Judaism among others).
The Cuisine of Nicaragua is as diverse as its inhabitants. It is a mixture of criollo style food and pre-Columbian dishes. When the Spaniards first arrived in Nicaragua they found that the Creole people had incorporated foods available in the area into their cuisine. Despite the blending and incorporation of pre-Colombian and Spanish influenced cuisine, traditional cuisine changes from the Pacific to the Caribbean coast. While the Pacific coast's main staple revolves around local fruits and corn, the Caribbean coast's cuisine makes use of seafood and the coconut.
Gallopinto is Nicaragua's national dish, it consists of red beans and rice. The dish has several variations including the addition of coconut oil and/or grated coconut which is primarily prepared on Nicaragua's Caribbean coast.
As in many other Latin American countries, corn is a main staple. Corn (maiz) is used in many of the widely consumed dishes, such as the nacatamal, and indio viejo. Corn is not only used in food, it is also an ingredient for drinks such as pinolillo and chicha as well as in sweets and deserts. Nicaraguans do not limit their cuisine to corn; locally grown vegetables and fruits have been in use since before the arrival of the Spaniards. Many of Nicaragua's dishes include fruits such as mango, papaya, tamarind, jocote, pipian, banana, avocado, yucca, and herbs such as culantro, oregano and achiote. 
Rapid expansion of the tourist industry has made it the nation's second largest industry. Every year about 60,000 Americans visit Nicaragua, primarily business people, tourists, and those visiting relatives. In the last 12 years prior to 2007, tourism had grown 394 percent. The country is mostly famous for its landscapes, flora and fauna, culture, beaches and of course, its lakes and volcanoes.
According to the Ministry of Tourism of Nicaragua (INTUR), the colonial city of Granada, Nicaragua is the preferred spot for tourists. Also, the cities of León, Masaya, Rivas and the likes of San Juan del Sur, San Juan River, Ometepe, Mombacho Volcano, the Corn Islands, and others are main tourist attractions. In addition, ecotourism and surfing attract many tourists to Nicaragua.
Education is free for all Nicaraguans and mandatory as well for elementary–age children. However, attendance is not strictly enforced and many children in rural areas are unable to attend due to lack of transportation or the need to assist in the financial support of their families.
Communities located on the Atlantic Coast have access to education in their native languages. The majority of higher education institutions are located in Managua. Higher education has financial, organic and administrative autonomy, according to the law. Also, freedom to select subjects of study is recognized.
When the Sandinistas came to power in 1979, they inherited an educational system that was one of the poorest in Latin America. Under the Somozas, limited spending on education and generalized poverty, which forced many adolescents into the labor market, constricted educational opportunities for Nicaraguans. In the late 1970s, only 65 percent of primary school-age children were enrolled in school, and of those who entered first grade only 22 percent completed the full six years of the primary school curriculum. Most rural schools offered only one or two years of schooling, and three-quarters of the rural population was illiterate. Few students enrolled in secondary school, in part because most secondary institutions were private and too expensive for the average family. At the college level, enrollment jumped from 11,142 students in 1978 to 38,570 in 1985. The Sandinistas also reshaped the system of higher education: reordering curricular priorities, closing down redundant institutions and programs and establishing new ones, and increasing lower-class access to higher education. Influenced by Cuban models, the new curricula were oriented toward development needs. The fields of study of agriculture, medicine, education, and technology grew at the expense of law, the humanities, and the social sciences.
A 1980 literacy campaign, using secondary school students as "volunteer teachers," reduced the illiteracy rate from 50 to 23 percent of the total population. The key large scale programs of the government included a massive National Literacy Crusade held March through August of 1980 and social programs which received international recognition for their gains in literacy.
Baseball is the number one played sport in Nicaragua. Although some of the professional Nicaraguan baseball teams have disappeared over the past few years, Nicaragua enjoys a strong tradition of American-style baseball. There are currently five teams that compete amongst themselves: Indios del Boer (Managua), Chinandega, Tiburones (Sharks) of Granada, Leon and Masaya. Players from these teams comprise the National team when Nicaragua is competing internationally. The country has had its share of MLB players but the most notable is Dennis Martínez, who was the first baseball player from Nicaragua to play in Major League Baseball, who also pitched the 13th perfect game in major league history.
Soccer has gained in popularity, especially among the younger population. The Dennis Martínez National Stadium has served as a venue for both baseball and soccer but the first ever national stadium in Managua is under construction. Also popular among Nicaraguans is boxing; the country has had world champions such as Alexis Argüello and Ricardo Mayorga.
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