- The Washington Times - Thursday, November 9, 2006

MIAMI — The Bush administration has adopted a wait-and-see approach toward relations with Nicaragua after the return to power of former White House foe Daniel Ortega.

Some U.S. lawmakers expressed fears before Sunday’s vote that a return to power by Mr. Ortega would further embolden Latin America’s anti-Washington bloc, led by Cuba’s Fidel Castro and Venezuela’s Hugo Chavez.

But after Mr. Ortega’s clear victory in a crowded field, U.S. officials said they would respect the decision of the Nicaraguan people to re-elect the Sandinista leader who led a protracted and bloody war in the 1980s against the U.S.-backed Contra rebels.

“We … look forward to establishing positive relations with Mr. Ortega and his new government,” said Eric Watnik, a State Department spokesman.

In the days after an election in which the leftist Mr. Ortega handily defeated the U.S.-backed and Harvard-educated Eduardo Montealegre, U.S. officials were unusually reticent about the results.

Some said they were disappointed with the results and feared Mr. Ortega would roll back free-market reforms and Nicaragua’s approval of the Central American Free Trade Agreement, designed to end tariffs on trade among Central American countries, the United States and the Dominican Republic.

However, the reforms instituted since Mr. Ortega was defeated 16 years ago have done little to better the lives of most Nicaraguans, about half of whom live on no more than $1 a day. The country remains the second poorest in the hemisphere ahead of only Haiti.

Before the election, Rep. Dana Rohrabacher, California Republican, wrote a letter to Homeland Security Secretary Michael Chertoff recommending a termination of the billions of dollars in remittances that flow into Nicaragua from friends and relatives living in the United States.

But administration officials say they are willing to give the benefit of the doubt to the Nicaraguan president-elect. “We will work with [Mr. Ortega] in support of Nicaragua’s democratic future,” Mr. Watnik said.

Hoping to assuage fears that he might return Nicaragua to the dark days of its Soviet-influenced rule and hyperinflation, Mr. Ortega told business leaders this week that he would respect the reforms implemented by the outgoing Liberal Constitutional Party.

“Sixteen years have passed since the war ended,” he said before the election. “I ask God to give us a chance to govern in peace together, without political differences, everyone together so that we can pull Nicaragua out of poverty.”

He did say in the campaign that CAFTA was “subject to review” and that poor Nicaraguans had been reduced to “beggars” since it took effect.

Many Nicaragua analysts say Mr. Ortega today is a far cry from the heavy-handed leftist who helped sink Nicaragua into the depths of poverty and despair.

“Ortega is clearly a changed man,” said Larry Birns, director of the Council on Hemispheric Affairs in Washington, noting the Nicaraguan leader’s willingness to accept economic reforms approved by Washington and the World Bank.

Some U.S. leaders “still have old memories of Ortega and the Sandinistas as villains with ties to Moscow,” he said.

World Bank officials have expressed cautious optimism about the new administration. “We don’t envisage any dramatic shift in policy,” said Joseph Owen, World Bank country director for Nicaragua.

Mr. Owen noted that Nicaragua has received $378 million in “soft” loans for 14 development projects, including infrastructure, education and poverty-reduction programs.

Nicaragua hopes that confidence in its ability to manage loan money eventually will pervade White House attitudes as well.

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