Millennium Challenge Corporation cuts funding to Nicaragua due to Election Concerns
By Heather Konjura
June 18, 2009

On Wednesday, June 10, 2009, the United States canceled $62 million in assistance to Nicaragua, citing concerns about democracy, rule of law, and a free market economy in the Latin American nation now led by a former Marxist guerrilla leader, President Daniel Ortega.

The Associated Press writes that the board of the Millennium Challenge Corporation (MCC) had cut $62 million from a $175 million program for Nicaragua because of problems in recent elections. Rodney Bent, MCC’s chief executive, said that "This decision is made with deep disappointment, as our partnership with Nicaragua has yielded tremendous progress over the past years in reducing poverty through innovative economic growth projects." Mr. Bent further said that the MCC would only back countries whose "governments actively demonstrate a commitment to democracy and the rule of law, as well as economic freedom and social investment."

According to The Associated Press, after last November’s municipal elections, the U.S. suspended new assistance to Nicaragua, as opposition parties said the election process and votes were fraudulent. In March, President Ortega accused the U.S. of punishing the poor with the suspension of funds and he further defended the local elections, in which his party won the majority, as fair.

Reference:

The Associated Press – US cuts aid to Nicaragua