NICARAGUA: Courting the Sandinistas

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After a year in power, Somoza's foes still show moderation

"We are together, your enemies are our enemies, your friends are ours, and if you suffer aggression, we will fight on your side." With that message of revolutionary solidarity, Yasser Arafat last week opened the new mission of the Palestine Liberation Organization in the Nicaraguan capital of Managua. By giving the P.L.O. its first diplomatic representation in Central America, the Sandinistas were in a sense repaying Arafat for having supported their struggle against former Nicaraguan Dictator Anastasio Somoza. Throughout the weeklong celebrations marking the first anniversary of the Sandinista victory, the P.L.O. leader was given an enthusiastic reception. Everywhere he turned in Managua, he found his grinning face plastered on posters and T shirts along with the slogan: "The people of Palestine reclaim their country."

Arafat was not the only revolutionary superstar in Nicaragua last week. Cuban President Fidel Castro toured the country for a week after an initial appearance at Managua's anniversary rally. He did not appear to have come to preach Marxist revolution. Instead, his low-key visit was marked by uncharacteristic restraint. "We are here humbly to learn and to be influenced," he said.

Ever since they took over, the Sandinistas have demonstrated a surprising restraint of their own. They have so far shown little inclination to intervene in such volatile neighboring countries as Guatemala and El Salvador. On the domestic front as well, the Sandinistas have exhibited a degree of moderation that has belied their Marxist slogans. Their strongest efforts appear to have been devoted to a remarkable teaching campaign that has reduced illiteracy from 50% to about 10%.

Thus far no leftist strongman has emerged. The country is governed by a nine-member Sandinista directorate, which wields effective power, and a five-member junta, which acts as an administrative board. The junta includes leftists, moderates and representatives of the private sector. The government upholds political pluralism, as well as freedom of speech and the press. Its apparent economic ideal is a combination of socialism and free enterprise. The Sandinistas have nationalized banks, insurance companies and the fishing industry, and taken over some 2.5 million acres of the country's arable farm land from Somoza and his cronies, yet they have allowed the private sector to retain control of about 60% of the gross national product. Despite their uncertainty over the Sandinistas' aims, many businessmen express cautious optimism about the future. Says Jorge Salazar, president of the Agricultural Producers' Union: "The private sector that is not investing in Nicaragua left with Somoza."

The continued support of private capital is crucial if the country is to overcome its formidable economic problems. The popular insurrection that erupted in January 1978 left physical damage estimated at $1.3 billion. When Somoza finally abandoned the shattered country, he left behind a staggering $1.5 billion debt and a national treasury of only $3.5 million. Today, with much of the nation's productive capacity still inert, unemployment is running at 30% and inflation at 60%.

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