Nicaraguan president's poisoned chalice

President-elect Bolanos faces a daunting task

By BBC Central America and Caribbean correspondent Nick Miles

In the presidential election of 4 November, Nicaraguans voted overwhelmingly in favour of the Liberal party candidate Enrique Bolanos.

Until polling day the race between Mr Bolanos and the candidate from the Sandinista party, former president Daniel Ortega, was too close to call.

But last minute switches of allegiance pushed the race firmly in favour of the Liberals.

The vote is being seen as a vote against Mr Ortega rather than a vindication of Mr Bolanos or his policies.

Daniel Ortega's days as party leader are numbered

Mr Ortega came to power in 1979 after overthrowing Anastasio Somoza, the last of a dynasty of autocratic presidents who had dominated political power for more than four decades.

The Sandinistas implemented a series of socialist policies during the 1980s including the expropriation of private property and nationalisation of much of the nation's industries.

The United States sponsored a counter revolutionary group, the Contras, to destabilise the government and, while not toppling the Sandinistas militarily, the cost of the war brought the Nicaraguan economy to its knees.

In 1990 Nicaraguans, tired with the war, voted the Sandinistas out of power.

Safer option

With the memories of this time of strife in their minds, the electorate has now once again voted for the safer option, the Liberals.

So what happens to Mr Ortega and the Sandinistas now after three election defeats in a row?

During the campaign, Mr Bolanos constantly used the phrase: "Three strikes and you're out, Daniel" - a metaphor tapping into the national sporting passion, baseball.

So is this the end for Mr Ortega?

Ortega changed too little and too late and the fear that he would return the country to the problems of the 1980s was too much for Nicaraguans

Former Sandinista minister

"Certainly his days are numbered," says Alejandro Martinez Cuenca, a Harvard-educated former Sandinista minister.

"Ortega changed too little and too late and the fear that he would return the country to the problems of the 1980s was too much for Nicaraguans."

Leadership challenge

Still a member of the Sandinista party, from his small office in Managua Mr Cuenca is preparing to make a leadership challenge.

"The party can survive, more than 40% of the people voted for us," he said.

"But if we are to get back into power we need to move further to the right, become Social Democrats if you like."

As the Sandinistas enter a period of reflection and soul searching, Mr Bolanos will be taking over the reins of power.

Victory speech

At his victory speech to thousands of supporters at the Liberal Party headquarters in central Managua, the 73-year-old president-elect promised to bring together all sections of Nicaraguan society.

He spoke of a new prosperity for the country.

But he faces a daunting task.

His victory is in many ways a poisoned chalice.

Poverty and child mortality rates are high

Nicaragua is the poorest Spanish-speaking country in the world, and the second poorest of all in the Western Hemisphere after Haiti.

The average income is just $500 a year, and 60% of the population lives beneath the poverty line.

Free-falling prices

Much of the country's income comes from agriculture, but free-falling coffee prices in the last year resulting from a worldwide glut in supply have bankrupted many small producers.

Tens of thousands of people have lost their jobs.

"The Liberal Party has never been interested in helping us," Manuel Chavez told me, as he sits in a makeshift squatter camp by a roadside in the central mountain town of Matagalpa.

The camp houses 200 families in appalling conditions with no running water or sanitation.

"We lost our jobs last year on the plantations," he says.

"A Sandinista victory might have helped us, now we have little hope for our future."

In the short term Mr Chavez is probably right.

Mr Bolanos has little room for manoeuvre. A crippling national debt of $6bn - 10 times the annual export earnings - means that he will not be able to carry out the spending programmes that the country's poor so desperately need.

Nicaragua is currently engaged in negotiation with its debtors to write off up to two-thirds of what it owes, but a final agreement could be several years away.

In the meantime Mr Bolanos has said he will raise funds by cutting corruption, an endemic problem, but this alone is unlikely to be able to finance even a fraction of the country's needs.