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PP RUEHLMC
DE RUEHMU #1621/01 1831639
ZNY CCCCC ZZH
P 021639Z JUL 07
FM AMEMBASSY MANAGUA
TO RUEHC/SECSTATE WASHDC PRIORITY 0684
INFO RUEHZA/WHA CENTRAL AMERICAN COLLECTIVE
RUEHLMC/MILLENNIUM CHALLENGE CORP WASHDC
RHEHNSC/NSC WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEAIIA/CIA WASHDC

C O N F I D E N T I A L SECTION 01 OF 02 MANAGUA 001621 
 
SIPDIS 
 
SIPDIS 
 
DEP FOR WHA/CEN 
 
E.O. 12958: DECL: 06/18/2017 
TAGS: PGOV PREL PINR ECON KDEM NU
SUBJECT: FIVE PILLARS OF FSLN STRATEGY 
 
 
Classified By: Ambassador P. Trivelli for Reasons 1.4 (b and d) 
 
¶1. (C) A document leaked to the press recently revealed that 
the FSLN has readied a plan called the "Five Pillars of the 
Revolutionary Project" to be formally announced on the July 
19 celebration of the 28th anniversary of the Somoza 
overthrow.  The 5 Pillars are: direct democracy and civilian 
power; autonomy of economic management; economic development 
and a revolution in energy; universal public health and 
education; and Latin American integration and unity. 
Venezuelan President Hugo Chavez's "5 Motors" provides the 
model for the 5 Pillars, form and content. 
 
 Pillar 1: Direct Democracy and Civilian Power 
 
¶2. (SBU) The goal of the first pillar is to expand direct 
civilian action beyond the election of officials.  The 
official wording proposes that the people be "the protagonist 
of the political process."  This process has already been 
established in the "Civilian Councils" which have been a 
source of considerable opposition-party outrage in previous 
weeks.  The Councils, which are a direct evolution of the 
"Sandinista Defense Committees" of the 80's, while officially 
not party-affiliated, are widely considered to favor 
Sandinistas and exclude all others.  Although the councils 
have no standing within the government, elected officials 
will be pressured to adhere to their suggestions. (SEPTEL) 
 
Pillar 2: Autonomy of Economic Management 
 
¶3. (C) The "self-management" of the economy as defined within 
the 5 Pillars consists of establishing credit programs, 
ensuring security of supplies, and providing access to 
property for the masses while respecting private property 
rights.   (Note: As with many of Ortega,s economic 
pronouncements, they are based on populist/Marxist concepts, 
so it is unclear how they are supposed to co-exist with a 
vibrant private sector.  Ortega only held his first meeting 
with the private sector players six months into his tenure. 
While the Vice President has been active in trying to portray 
a friendly investment climate, companies, both local and 
foreign, are concerned that Ortega,s consolidation of 
political power will begin to extend to them.  In the 1980s 
Ortega was famous for showing favoritism to a few companies 
of "patriotic entrepreneurs" and leaving all the rest to 
struggle.  Interestingly, his focus on the credit to small 
producers has been through a state run program.  There have 
been no efforts to force the private sector banks to become 
involved in a sector they consider risky.  The ideas also 
circumvent the 300 micro-lending enterprises which exist in 
Nicaragua and reach down directly to the poor and SMEs.  End 
Note.) 
 
 
Pillar 3: Economic Development and a Revolution in Energy 
 
¶4. (C) According to the leaked document, development will 
focus on the construction of new oil refineries, factories 
for aluminum products, and the improvement of Nicaragua's 
inefficient energy system.  Ortega recently announced that he 
asked Iranian President Mahmoud Ahmadinejad for energy 
assistance during his recent trip across the Middle East in 
Africa. (SEPTEL)  Venezuela has also been a significant 
source of foreign aid, much of it in the form of subsidized 
petroleum. However, this aid is not as beneficial as it 
seems.  Completed refineries are a long way off; financing is 
complicated as the costs are between USD 2-4 billion, there 
is a two year waiting list for the parts needed, and 
construction is a complicated process.  An inauguration in 
five years would be a very aggressive estimate. Oil shipments 
from Venezuela have arrived erratically and not in the full 
quantities promised.  Also of concern are the terms of the 
oil deal, which could potentially create a public debt of 
over USD 300 million a year in addition to violating the 
agreements that allowed Nicaragua to receive massive debt 
forgiveness through the HIPC program (most of which was debt 
incurred in the 1980s.)  The only hope that Nicaragua has to 
improve energy output for the near future are new electric 
plants, which are set to add approximately another 200 
megawatts to the system in 2008. 
 
 
Pillar 4: Universal Public Health and Education 
 
¶5. (SBU) Making Nicaragua's health and education systems 
truly universal has been a long-term goal of the Sandinistas. 
 The problem developing it will be twofold:  financing the 
supplies and infrastructure necessary, and implementing such 
a vast scheme within a system not known for efficiency. 
Reports indicate that demand for health and education centers 
has risen significantly since the decision to eliminate all 
associated fees and that the increase already poses a 
challenge to the system.  The need for more facilities, 
personnel, and materials is seriously hampering facilities 
that have received little to no additional financial relief. 
 
Pillar 5: Latin American Integration and Unity 
 
¶6. (C) Continued participation in The Bolivarian Alternative 
for the Americas, or ALBA, will be the key to the final 
pillar.  The countries of ALBA, of which Venezuela clearly 
exerts primary influence, have already begun the process of 
joint support through the establishment of a bank to fund the 
projects proposed by member countries.  ALBA is clearly being 
set up as a counterweight to CAFTA and policies which help 
Nicaragua take advantage of it have taken priority over 
pro-CAFTA policies.  Negotiations for an FTA with Taiwan are 
currently stalled and the Central America-wide agreement with 
the EU has not gotten off the starting blocks. 
 
Comment 
 
¶7. (C) The Five Pillars contain no new plans, merely a new 
presentation of the same objectives and rhetoric that the 
FSLN has utilized consistently throughout the last six 
months. The cry for a more democratic process is a thin 
veneer disguising the real goal: to establish FSLN mechanisms 
in the political system from the municipal level upward.  The 
concepts of greater civilian participation and universal 
health and education are admirable, but Ortega has yet to 
propose firm plans on how to accomplish any of his goals. 
Unless the rhetoric behind them is matched by reality, the 
Five Pillars will serve only as an additional public 
relations device for Ortega. 
TRIVELLI