Why Not Nicaragua?

I just read an article in the NYT about how Applied Materials is moving their R and D facilities from Silicon Valley to China. The Article is generic enough to go on to talk about why as well as who. One of the driving factors is

Xi’an — a city about 600 miles southwest of Beijing known for the discovery nearby of 2,200-year-old terra cotta warriors — has 47 universities and other institutions of higher learning, churning out engineers with master’s degrees who can be hired for $730 a month.

Nicaragua clearly isn't China or even India as far as being in a position to take over some high tech work that is currently happening in the U.S. but it is more than just a place to open sweatshops. The best indication of that is that while some first worlders have moved here because their couldn't afford to live where they really wanted (including their home country), some are here because they actually like it here.

Just one reason one might want to live here is the weather. I can assure you that is one of the top things on my list. But, it is not the only thing. Let's leave the why list for another discussion and think a bit about what might be possible here. These are just random thoughts.

  • In the energy sector, both wind and geothermal is being developed here. Why not create an environment for doing alternative energy research.
  • Continuing with the energy sector, install and support in-home and in-business alternative energy systems.
  • Crop research. Rather than the Monsanto-ish GMO crops, how about some real research into sustainable crops and sustainable farming techniques.
  • Single-industry technology companies. I am thinking of equipment that would be used by companies throughout the region such as alarm systems, telephone systems and such. While production of the pieces would probably be done in China, Nicaragua would be the perfect place to do final assembly and support.

Some will immediately say that the needed skills are not here to do this research. In many cases that is true but it doesn't seem that hard to import those skills if you build the right environment for the people you need. And it sure would cost a lot less than doing it in the U.S.

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It's Never Fair To Generalize

and comparing business customs to government workers is even less fair. There are plenty of small-business hustlers in Nicaragua, I've met some of them. These people would step up to the plate and hit a home run if given half an opportunity. There are completely worthless government workers in the US, and from what I've heard, in Canada as well. Government workers are government workers the world over.

What I find odd is why the Nicaraguan ruling families tolerate the petty corruption and inefficiencies? It puts nothing in THEIR pockets. Look at the difference between Nicaragua and CR, for example. CR has some of the biggest thieves in CA, but the casual tourist and investor doesn't see it. CR has realized that preventing the hassles we see in Nicaragua is just good business. It protects that swollen river of dollar-bearing tourists, many of them repeat customers, a fair number of the others, word of mouth referrals. "Such an exotic country, Mavis. You must go. The coffee is fantastic. The people are some odd shade of light brown . . . No, they're NOT Mexicans, they can't be . . . They all speak English. And it's so cheap . . ."

Targeting the tourists in rental cars in Nicaragua has to cut down on Budget car rentals, and take money out of the pocket of the family who has the insurance monopoly for example, --taking money out of the pockets of someone who probably has the juice to put an end to it. I've driven hundreds of miles around CR, never once was asked for a bribe, and indeed, never even got a ticket.

What does the tourist tell their friends when they return from Nicaragua? " Loved Granada, Loved the beaches, people were outgoing, friendly and helpful, but wouldn't go back, and if I did, wouldn't rent a car, I was stopped twice and had to pay the police bribes to keep my license." Tourism is the fastest, easiest way to put some serious money into middle-class Nicaraguan pockets. Small hotels, language schools, restaurants, guides, waiters, all benefit immediately from that tourist money.

Don't misunderstand, I love Nicaragua the way it is. I hope it never changes. This is selfish on my part -there are a lot of lives that could be improved with some extra money floating around. I enjoy jousting with the police: Should I stop, or just wave? "Have a nice day! -- Friendly fellows!"

"You say, my license will take three weeks to get to MGA if I don't pay the fine here?" Aside: Good thing I have a duplicate. My wife, however, hates it, and takes it very personally.

Nicaragua has to be a place that people WANT to come to before you see sustainable infrastructure investment (as exposed to exploitive harvesting of resources). And when I say people, I mean the families with the big Eco- tourist budgets, not the $20 /day backpackers. But, when that happens, Nicaragua will be ruined -(like CR)- and where will we all go???

But you generalized

I have lived in both countries. I have been stopped in Nicaragua and offered the opportunity to pay a bribe. I never have and have never received a ticket. In Costa Rica I was offered that same opportunity and when I didn't pay the bribe did get a totally bogus ticket. To me, the bottom line is that Costa Rica just does a better marketing job.

When you see a work crew from ICE (government-run electricity and telephone monopoly) in Costa Rica, it is not uncommon to see two people working and five watching. If you inquire, the two that are working are usually Nicaraguan.

A friend was working on the south end of the Nicoya Peninsula in Costa Rica. There was money allocated to re-do the rather sick road. But, it didn't happen. He inquired and was told "the money is gone". He inquired as to where it went. The government dude said, "You don't understand, it's gone".

Is this the norm? Not necessarily but, once again, generalizations don't work. If there is one generalization it is that in Nicaragua your attitude is worth more than it is in Costa Rica.

WHoaaa.... no knowledge of Nicaraguan culture!!

Where did I say that? If the cap fits wear it.

Don't get bent out of shape because you made a generalization that I chose to disagree on.

Nicanor is a Nica and he agreed with you. I don't. That's the discussion.

I could talk about Canadian work ethic based on 20 years of working and living there, or even English work ethic based on 29 years living and working there. But I would not generalize. My 26 & 29 yr old kids in Canada can tell me stories of work ethic there, but that's all they are, personal stories and experiences

You did it again in the oversimplified analysis of your parting shot: "Poverty is lack of business. Plane and simple.."

I wish it was that plain. I agree that business is good for the economy. But, why do the oil towns of Calgary and Edmonton still have huge homeless shelters and pan handlers on the streets? Because its a bit more complicated than simple money and a good economy.

Sorry but I am in a "Don't Diss Nica's Mood.... you just happened to get in the way of it.

Sorry

I would not be a true Canadian if I did not use the word "sorry, my mistake" in a post..

I read the sentence "knowledge of Nicaragua and you answered that, thank you." with a sarcastic implication which I guess you did not intend.. Sorry, my mistake.

Anyways .. I now return to lurking...

And your 20 years in Canada rubbed off in your last sentence...

I'll go with the traditional meaning of work ethic...

A set of values based on hard work and diligence.

My response was only to your one liner "The Chinese work ethic is completely different"

I just wanted to know if your comment was based on personal experience or some of the tired, well worn comments from those who have little or no first hand knowledge of Nicaragua and you answered that, thank you.

You seem to describing more of a business ethic in your second post, like: promises of delivery and parts not here on time. A lot of which is not even a business ethic, more a fact of life. If Toronto had no power from 9am to 4pm one day without any notice, how good would service be?

As for the Semana Santa comment, that's a cultural issue, akin to working on Xmas Day for North America.

Likewise: commitment to punctuality (cultural), humbleness (depends who your are asking them to be humble to), admit to fault (cultural), and the placement of work over family (which many I know do because they have to, not because they are told or expected to).

Personally, the last thing I want to see here is too much of "The Canadian or American Way".

Work ethics, and the lack of other things , a Nicas deficiency?

Are this deficiencies something we Nicas are taught by the people around us in our formative years or a sort of self preserving, albeit misguided, attitude and if so, Why? Anybody that had a normal, by Nica standards, had someone at home telling us how to behave with and relate to others, and also at school. Again I don't consider myself the exception to the rule but I was told and taugt, at home and school, to have pride on whatever I did; to be punctual ,elementary school didn't wait for me to start if I was late and in HS the bus didn't wait for me either. My first "job" was helping at church as an altar boy at age 11, Sundays starting at 4 am , 7 am, 10 am, 5 pm and 7pm, Thursdays at 8pm and any other service after school. At 13, after school, I was helping my mother start up her little business, with borrowed money, selling to her friends clothes,shoes,jewelry and cosmetics on credit, she was a 'comercianta' that traveled to Panama and Mexico. My mom as her friends-customers always paid their bills .

Zapoyal, I live amongst a lot of Nicas like you.

Your critic said this about himself: "I have been married to a Nica for 17 yrs. I have visited there 4 times for a stay of about 2 months total".

Perhaps we should have simply Ignore the source of the comment as others probably did.

Work ethic starts with having a decent and fair paying job opportunity in the first place. Any comparison to China and Canada on that basis is pure folly.

past time

I was grow up in a strict and discipline way, some liberals label that like child abuse......in our way of development like society that was the rise style, but that wasn't the important fact in our way of learning, because today we still seeing the truly abuse in childes. But i talk about this because is one of the attacks on our past ways of education.

One important thing in education we have at that time was the respect to the old people , to our teachers,to our parents, to the country emblem, to the private property, to the woman, to the environment.

Was a subject called "moral y civica" (morality and civic), we learn all about respect , that also was teaching in our home. In a blink of eyes, all the history of our country change, for many people , their knowledge learned in their lives was a lie, all was replaced with a highly history embedded in party propaganda.

At some point of our history with the changes we were implementing to try to changed the society, we messed up.

At the same time we initiated a change in the economic and political system, we star a lot of changes in the way of life and education of our people and mainly in the youth.

The confusion of liberty and new ways of thinking, came with a lot of misunderstanding , extremes point of view and the natural rebel behavior of the human being.

Teachers, parents, property, symbols..all reference points were lost, a new human being was born.

The hard job was replaced with the party state paternalism, the saving planning into the family was replaced with the given and the usurpation of private properties, the responsibility to comply with your debts was replaced with the party government condonations, the authority of the parents was replaced with the obey to the party and the revolution.

Suddenly the youth instead been playing or flirting in natural ways, were putted in a environment were they natural instinct was released with less control and out of the parents guidance.

The award in your grades school by fulfilling your studies, were replace by obeying and participating in the many task the revolution and the party were implementing.

The businesses enterprise was replaced with the state omnipresence in all areas, your success in the jobs wasn't because you were a professional or experienced worked , was you loyalty to the revolution and the party.

In must houses of the sympathizers and people scared (of the repression) next to the religious symbols, were natural to set photos of the new leaders, personality cult was also born.

The natural neighbors chip chap and gossip was replaced with a well organized red of spies, all people was watching each others and mainly to those that were labels like contras.

The formal merchants suddenly were acting like delinquents, thieves..because they must smuggled all the goods, they sell before.

In the people minds was seed the knowledge that riches were evils, and that was impossible for a human, get rich with out stolen or exploitation of other humans being, so many people prefer to follow this lines instead to fight against a boiling and dangerous process.

All this were ending...but the consequences still present, our society change a lot, and we still in the turmoil of those changes, like a tectonic plaques, looking for the right fit .

So few times.. i like to talk about this, but every time i do it, is like watching a movie about my life and participation in that process.

Sorry if somebody encounter my opinion like a Hijack thread, but i think is related to the opinion of the writing.

A Nicas deficiencies ? part two

Sorry but my computer is acting crazy. As I was saying I was taught by word and by example to be a good person. About showing humbleness to others, specifically in a business setting, I think some people confuse being humble and being humiliated. I stop being humble the moment someone feels entitled by that old business creed 'the customer is always right'. Treat others as you'll like others to treat you I was always told. So if we Nicas have a somewhat similar upbringing as mine what happens to us or to the seemingly great majority ? A theory of mine: that old Gueguense mentality might be our only way to cope with our incapacity to fight against a situation that has proven itself to be like death itself. Death, we like to think it can be fooled and cheated sometimes but it will always be there at our side to the end . But in the meantime we lie, cheat, defy and everything else there is to make us feel that at least today, this time we were the wiser. They've done it to us lets do it to them. Sad but true.

Hey look

I work at a high tech company and I am a sparkie by trade (Electronic tech) I am not a learned text typing debater.. So it looks like my choice of words were not chosen well :-)

I am not looking to thumb wrestle with you as there are clear and obvious reasons why Nica is what it is, I assume you know them and so do I ..

As for your comment of no knowledge of Nicaraguan culture well again.. I gave my list of credentials, If that shows no Nica depth and understanding I see there is little value in continuing this discourse with ya :-) BTW you offered me no background why I should subscribe to your view of similarities or difference of work ethic. :-)

Poverty is lack of business.. Plane and simple..

I am kinda sorry I spoke up on this and will retire to my normal posting "over there"

Bye..

Work Ethic

The Chinese work ethic is completely different

Most of the high end fundamental science R&D @ AMAT was already moved to Israel about a decade ago.. At that time stereotypical / mythical "Russian PHD" for $300/wk was the words I heard.

This article must refer to process R&D. It makes sense to move process R&D to the foundry location.

There is already a large base of foundries (from Intel) in Costa Rica, next door.... The opportunity is already there (to work in hi-tech) if they want..

http://www.intel.com/jobs/costarica/sites/heredia.htm

Work ethic different to what/who? Nicaragua?

Does that me they don't have to work 2 or 3 jobs, 7 days a week?

Maybe your comment needs explanation. If you have lived, worked and run a business in both countries I would be interested in hearing your views on the comparison.

Work ethic

Hi

First your tone sounds a bit confrontational so I am choosing my words carefully.. ( I hope)

I have been married to a Nica for 17 yrs.. I have visited there 4 times for a stay of about 2 months total. Up here in Canada I have approximately 30 Nica family and acquaintances. In Nica I have approximately 20 people that I can think of in the extended family that I have regular contact with..

I have also done service work extensively in Japan and Taiwan for the past 6 yrs.. In total about 9 months on the ground over there.

I think you may be reading into "Work Ethic" some stereo type of lasyness .. If so you are that in your sterotype to address..

How many Nica institutions will Promise you an answer at 10AM tomorrow and deliver it at 9:55AM? How many Nica institutions will call you at 9:55AM the next day and offer apologies if the answer is not available. How many Nica institutions can you order a part from with an expected delivery of 12 days, and get it in 12 days? Will someone from (NA and CA in general) stay at the office until 10PM with no remuneration for a conference call? If the completion of a project runs into Semanta Santa, with extensive overtime, can you count on it being done?

It is not the effort part of Work ethic, it is the commitment to punctuality, humbleness and the ability to admit to fault and the placement of work over family ...

Now if Nicaragua had this it would not be the Nicaragua we know and love today.. It would be more like .. um .. Costa Rica or Dallas or The Silicon Valley.. Now where did toda las cheles run from ?? :-)

Cheers..

true

Like Nicaraguan I'm feel ashamed reading this opinion, but i must admitted that you pin point one of our attitude problems, in a very simple but truly opinion.

You have partially answered your own question

Fyl, I think you have partially answered your own question in "Postal Aduanas and Reality" (http://www.nicaliving.com/node/16920).

To quote you: "The person in customs related to mail (and it is one person) changes regularly. This is a person in Managua that deals with everything they feel might be subject to duty. They generally have no clue what they really need to do."

I would think that a small- to medium-sized business or a university would not want to put up with this type of hassle and delay, and it also occurs in other areas of the Nicaraguan government.

I think there is a solution

While I have no first-hand knowledge of how it works, there are lots of businesses here that seem to get things from customs just fine. For example, I bought a color laser printer from DataTex for the same price it would have cost me to buy it in the US. That is, here in Nicaragua with tax and everything for what it would have cost FOB Miami. There are certainly other examples as well.

In Costa Rica, I got introduced to what we might call "smart lawyers and businessmen" that knew how to play the system there. I have had no such luck here. It I was to start a business that depended on imports or exports, I would put some effort into making such connections. And, yes, it is very irritating to be the little guy who doesn't know the system here.

Playing the system

Is playing the system the solution or the problem (in Nicaragua)? Per business, there is little doubt that not playing it will cost you - and eventually it might cost you the business venture if it is dependent on the game. Playing it has consequences though. For example, in the country North of you, chose not to play and you lose; chose to play, and you are a mini-golpista, permanently and by definition. I am not saying one should or shouldn't play the game, I just find the reasoning and the source surprising. It is an assumption that the system is broken; for those on the other side, it certainly isn't broken and is working perfectly. The system does exactly what it is supposed to do: provide a preferred and parasitic existence for those favored to receive it. Much like police and the judicial system and other governmental outfits, this is exactly what it is supposed to do, not the result of a couple bad choices, an outdated management theory, or lax oversight. This is what the system is supposed to deliver; these positions are entrepreneurial in nature and this is the expected and/or accepted result. This is not unique in Nicaragua, and this isn’t an anti-Nicaragua post. Nicaragua, and many countries around the world, could not eliminate this sort of problem without greatly revamping much of what goes on in and outside of business & government, and basically redefine countless things (some of which are cultural). Start to fix the problem and Nicaragua starts to look like Costa Rica, fix it more and Nicaragua starts to look like Uruguay, really fix some of it and it is Chile, really fix a lot of it and you start to look like some European countries. As you move down (up?) this road, government grows and costs skyrocket and pensioners aren’t living there quite so well for $500 a month. There is no option of preserving all the things one likes about Nicaragua, and at the same time eliminating all the obstacles or nuissances to conducting private, public, and business life, as one does in other, wealthier countries. This doesn't answer your original question though: Why not Nicaragua? For companies like those you describe, they get the best of both worlds (low costs preserved, no changes in government, all parasticial headaches promised not to happen, and a pass on all other hassles) - yet they still chose to say no and go elsewhere.

Agreed

You have explained the concept that I keep trying to tell people about. I feel your explanation is clear and a few more people may understand but many will not.

When we talk about government, saying "you get what you pay for" has a different meaning then when you buy a replacement part for your car. And, as you say, it can be good or bad, depending on how you play.

In the first world, governments tend to be expensive. They do lots of things—some good for all such as have fire departments, some not good for all such as general overhead and some that is good for a certain group of people. An example of this last category is the FDA handling of Stevia. Pretty much, Stevia was illegal (and there is a lot more here) when the little guy wanted to introduce it but, Stevia for Coca Cola and Pepsico are now legal. (I picked that particular example because, hopefully, it will be less loaded than many others such as health care.)

In Nicaragua and many other third world countries, you don't have to be Coca Cola to be "a friend of government". For example, on the local level, dinner with the mayor may get a favorable "solution" to a zoning issue. If you are on the winning side you will probably call this "government addressing the needs of the people". If you are on the other side, it is "government corruption". I personally prefer the more neutral "equal access to government".

Is it right? Is the US government bailing out auto manufacturers or Wall Street right? The main thing it is that it is different. In Living Like a Nica I explain you can move here, live very inexpensively and then, if you wish, move yourself up the economic ladder. The reason this is possible is because you, an average person, can build the connections you need to get things done. You don't have to be General Motors or Coca Cola.

If you see this as a plus, you will probably have a good life here. If, on the other hand, you just see this as government corruption that is easier to address than the kind you see in the U.S. you will be frustrated or worse.

NICABOX comes to SJdS

NicaBox from Transexpress is having a show and tell at the CHICABRAVA Surf House store front right on the beach in San Juan del Sur on Friday, March 26th at 6pm.

Transexpress provides you with a physical address in Miami to where you can have anything sent then forwarded to you in San Juan del Sur. I will be at the presentation and will report my findings or at least provide the contact information.

if u were going

to invest $$ in a country..would u trust nicaragua..i own property here so i put my trust in the country..but im sure a lot of people wouldnt..includeing multinationals

In a word, yes

Now, probably GM (are they still in business) wouldn't but that isn't what I am talking about. I am talking about some company or maybe university that sees the advantage of Nicaragua as more than cheap labor. And, assuming they bring something decent here (that is, more than minimum wage jobs, educational opportunities and such), yes, I do trust Nicaragua.

Win-win is the key here. Opening another McDonald's or a Walmart just destroys local business but offers minimum wage jobs. But creating a new industry that could serve the region is a different game.

Zamorano

When I was up in Honduras, I was pretty impressed with the Zamorano Pan-American Agricultural School (Spanish: Escuela Agrícola Panamericana Zamorano). A private, coeducational university - main focus is agricultural with a 1,000 students. It is registered in Delaware as a 501(c)3 non-profit organization. They host students from Honduras, Guatemala, El Salvador, Nicaragua, Costa Rica, Panama, Ecuador, Peru, Colombia, Chile, Bolivia, Dominican Republic, Paraguay, México and more.

Now, try this concept:

Tie one of these facilities into the Zona Franca system here, add into the mix a "Pensionada Incentive" for a "mini brain-drain" from other countries and pair up the Profs with Nicaraguan's and we could have an Education/ R & D/ Production unit that is the envy of CA.

Its just an idea but I know just the person and organization to present it to; Antonio Lacayo from the CEP (Casa Pellas Foundation).

We often hear that the opposition doesn't offer any alternatives along the lines of "If we were in power, we would do this...."

Maybe they don't have any ideas, maybe we need to give them some.

Aduana

The habits of aduana are killing the business atmosphere.

The inconsistancy the hastle; after importing a few personel Items the taste left in my mouth is pretty sour. I could not imagine waiting for my shipment of widgets that I am turning into gadgets getting held up for some signature, the first time would ruin you, how could you possible schedule delivery?. How could you predict cost?

I paid duty on a master index of drill bits I had brought to Nicaragua The set I paid $123 for my import duty was $43 some magic number no telling how they figured it. Six months later I brought the equal set for a friend. I found it on sale for $106 but now my duty was $61. I showed how I paid $43 six months ago therefor I should pay this amount again. After three tries three trips to Managuia the last one with a lawyer friend, I finally paid $43.

Try that for some contaniner of goods.

I buy LEDS form a china manufacturer I call my order pay for it and expect delivery in 8-10 days, flawless now how can NIcaragua compete.

My associates Near San Juan imported three containers at different points in the last 5 years. Not once has it worked out One container all the items where unpack by aduana the fragile struff was repacked on the bottom and the heavy stuff on top. When the container was opened about $5000 in supplies where destroyed. Aduana response not our problem!!

Container two almost six months to clear alot of damaged stuff.

Container three tools and building supplies lost stolen only 85% of the shipping manifesto was delivered however taxes where paid on all items on the manifesto. Of the stuff that made it about 25% was damaged.

Aduanas attitude and response not our problem and refused to show any concearn for the losses suffered.

SO in short if your personel experiances where not very satisfactory I can see it being a problem to develop trust you would need for an import export business.

This will give you some reason to hope

Wow! Your experience sounds truly painful and expensive.

I have come to the point that when I see a problem this bad and this well known, I go to the Inter-American bank (IDB) website, www.iadb.org, to see if they are working on it. The good news is they are. The bad news is that it must be wide spread in LAC and it won't be a quick fix.

So here is what they are doing. The project is called Customs Capacity Building in LAC - It's not unique to one country. It was approved Sept./09 and it's in the implementation stage. They chose four countries (that they did not name in the report) and they were sending customs experts to review how the customs process works and what the problems are. Next, they are going to make recommendations for the four countries including implementing best practices (such as non-intrusive inspection methods). Finally, they are going to educateall the other LAC countries.

This is the link for the Customs Capacity Building in LAC.

http://www.iadb.org/projects/project.cfm?id=RG-T1705&lang=en

I remember this story in SJdS

When I look at some of the players involved, it's no wonder they had problems. The blind were leading the blind and one had an attitude so bad it cost him a trailer he imported inside the container.

Telling the Customs guys how they were going to resolve it for him wasn't too smart.

Nor was refusing the help of guy that could have fixed the problem, but naturally he doesn't work for free. So he "Cut off his nose to spite his face" and lost it.

Checking what is a "Luxury item" before you import it might have helped in the debate over a whole array of Chinese items like Jacuzzi tub, electric massage chair etc etc.

I'm not saying that customs were not at fault at all, but lets paint a fair picture shall we.

I apply this rule. If I can't get it at the Oriental Market and it can't be made (copied) in Nicaragua, I should reconsider whether I need it.

Like my buddy used to say about WalMart, "If they ain't got it, I don't need it"......I thought it was funny.