How Would You Prefer to Deal with Government?

Thread http://www.nicaliving.com/node/20556 is about how you feel about the government enforcing laws that are already on the books. It is important and there are certainly some opinions. But, as we always do, a totally different topic has appeared in that discussion. This post is an attempt to give that new topic a place to live.

To clarify, this forum is "how you want it to work" when dealing with government which is a very different topic from the government just enforcing laws on the books. In particular, this is our preference rather than anything specifically related to current laws. Call it advice for the government.

It seems the two biggest issues are obtaining/renewing residency and dealing with customs. In both these situations, some people will prefer to deal directly with the government, others will prefer to be able to have an agent or representative handle the situation for them. In particular, newcomers with little of no Spanish skills will need to use an agent. (While you might like the government to deal with you in your language, this just doesn't seem practical as any legal document here must be in Spanish.

One of the most common complaints are inconsistencies. That is, how it works seems to depend all so much on who you are talking to. (Note that this is not unique to Nicaragua. I have heard from quite a few people that how to get residency in Ecuador seems to change each week.) So, let's see if NL members agree on how we would like things to work.

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Dealing with Immigration

Let me diverge from the fiction here and offer a real example from today. I went to renew my cédula today. I happened to be with Paul Tiffer -- not because he was required but because I was in Managua and we had some other things to talk about.

I had prepared all the documents needed myself: police report, health certificate, copy of my cédula, application form, photos, document that showed I had a pension (which still makes no sense to me because I got my residency before I had a pension but, whatever), and copy of my Passport. Remember, this is a renewal, not an initial application.

The guy at the window, in polite terms, didn't have a clue what he was doing. He asked for things that would not be required of someone renewing "married to a Nicaraguan" residency. He made multiple trips somewhere to ask questions.

Now, I happened to know what I was doing and what was required and Paul was there to reinforce that. What should have been a 2-minute event at the window was more like a 20-minute event. My guess is that if Paul had not been there it would have been an hour and maybe just not have been resolved at all.

This particular window (actually there are two) is not for general-purpose tasks. They are specifically for dealing with extranjeros. I would like to be able to go to that window and talk to someone who has a clue about what they need to do.

You know, sometimes places have new employees

They tend to relax if you share some of your own new job stories with them, and if they're not terrified that they're going to screw up badly and lose the new jobs, they tend to remember what they've been told better.

One of the two windows was staffed by an experienced clerk who knew quite a lot when I was there and Suzanne had found her helpful earlier when she was getting her own residency. The other had a guy who was less friendly, but not hostile. If it's two guys now, one of them is new and probably never has dealt with anything other than straight pensionado. If the woman is still there, always get in her line.

I'll complain about Nicaraguan bureaucracy when it's as bad as what I went through to get paid all I was promised for a summer session at Drexel University, some four months after I was promised I'd get a partial payment while we were teaching. Taking it from "we don't have you on record as teaching this summer" to collecting everything makes Nicaraguan bureaucracy look saintly.

Rebecca Brown

20 minutes and you are complaining!

This plastic card gives you the right to live and work in Nicaragua for another 5 years and you are complaining it took 20 minutes!!! It took me longer than that to renew my Claro phone plan!!

Try getting a US tourist visa for your Nica wife in 20 minutes or less.

I think they're doing well

Even people who don't speak much Spanish can deal with Intur and Migracion with an interpreter. Two people at Intur speak English more or less well. An interpreter should cost $20 a day mas or menos, along with meals and transportation, maybe less if you've got a good friend. Legal Spanish is pretty much full of cognates, so is easier to read than US legal documents all too often. Translating all the documents tends to be not that expensive. You save $300 to $400 going this way and end up learning something about the Nicaraguan system (I've found the Nicaraguan system far nicer than the average expat). A lawyer setting up the notary paperwork costs about $150 US to $160 US. Translator -- $80 or less, depending. Interpreter -- total cost around $200 or less ($20 plus $8 plus $6 times two or three -- you don't really need the interpreter for delivering the completed package or even for taking the paperwork to Migracion as Migracion has English speakers on staff, and you can figure out the procedure for getting the cedula without speaking much Spanish at all (my interpreter was buying snacks when I actually got photographed and got the card).

I haven't heard of any inconsistencies in the people I know who managed getting their own residencies -- some have had errors committed by anyone from the lawyer's secretary to Intur not putting a form in the package, to Migracion not accepting corrected forms or forms in two hands. That last is a simple fix (two of us here had to fix the form). We bought a second form and copied the information over. Didn't have to make a separate trip to Managua. I'd recommend that anyone getting the package from Intur to take to Migracion check to make sure that the long multi-page form is included and to make a copy of that form for your own records as you'll need the information for renewing in five years.

People who aren't pensionados can get residency on a year to year basis and then convert to five years at a time after they've been here for a while. I know one person who did that.

The changes in the procedure seem utterly logical -- extra-screening of people whose professions often go hand in hand with right wing politics makes sense; making sure that someone at Migracion actually meets the applicant before granting residency makes sense. I take it that under the old system, people could go through the whole process without meeting any one Nicaraguan, and have references from people on their lawyer's staff who'd also never met them, and just show up for the photograph after they were accepted, and even bitch about having to go to Managua for that.

The most charming thing about Nicaragua is that if you're a jerk, the person dealing with you gets to give you a hard time. Feature not a bug.

My test anecdote for people who will fit in Nicaragua is telling the story a friend who was a New Yorker told me about her dealings with a Southern desk clerk when her reservations had been misplaced. She did the Yankee mistake of yelling and the desk clerk quit trying to solve the reservation problem and deal with the lost emotional control displayed by the Yankee, which would presumably be excruciatingly embarrassing after the poor distraught woman was in her right mind. My friend who was shameless raised her voice further, and got less cooperation from the desk clerk. Not until she pulled herself together and acted like a sane person did the desk clerk turn back to the issue at hand.

If you sympathize with the clerk, you'll do well in Nicaragua. If you sympathize with the Yankee, not so well. The woman who was the Yankee in question never did figure out why yelling didn't work. I knew at least one of the possibilities of what was going through the clerk's head (and she had not personally lost the reservation).

Rebecca Brown

Actually Fyl, No,

Your comment ...."It seems the two biggest issues are obtaining/renewing residency and....."

Its really only one members obsession with that and the more you start pages about it, the more she will fill them up "argumentum ad nauseam".

Tourism is another subject to avoid....

I'm just telling people that they don't have to have a lawyer

It was an excellent learning experience. I learned that most expats on forums like these give bad advice about dealing with Nicaraguan bureaucracy. I now have a measure for how much not to pay attention to what's said about how Nicaragua works by people who were among those who attacked me when I was posting about my experiences. I can assume that they're likely to be as wrong about other things.

I have actually suggested to people that they hire a lawyer for getting residency under certain circumstances.

I don't think any expatriate should have any say in how Nicaragua manages its legal system so I disagree with the whole premise of the question. Costa Rica deports expatriates who try to get involved in Costa Rican politics.

Rebecca Brown

Attitude Check

I was not suggesting that we should have a say. The idea was to collect some suggestions that might help the Nicaraguan government better address then needs of expats. Some of us are good for Nicaragua. Humoring us could be a good thing.

To put this in perspective, Costa Rica is excellent in trying to make itself look more tourist-friendly than Nicaragua. Does Costa Rica really love tourists? Unlikely but tourist revenue is a good thing. When I flew to Guatemala immigration was zero effort and zero dollars and they are doing a lot of work to convert Guatemala City into a very positive place to be. Once again, good marketing.

I happen to like Nicaragua a lot but it has competition. Let's try to help it compete.

Basically, the way people see tourism here strikes me

as based on false analogies with two countries that have very different histories and things to offer. Nicaragua doesn't have mountains as high as either Costa Rica or Guatemala and it lacks Guatemala's ruins.

Nicaragua probably sees this all as an experiment, with considerable risk considering that many of the people coming here are hostile to the government in power (I am more amazed by their grace at allowing in their former enemies than anything else about the country -- and think they should be more like the Welsh and burn some vacation houses from time to time).

If Nicaragua competes in tourism, it's not going to win against places with more miles of beaches (Costa Rica) and with more and fancier ruins (about every Central American country to the north of here, including El Salvador, which surprised me). Mountain tourism is regional -- there should be enough statistics out about that to convince anyone who isn't being deliberately obtuse. To run a mountain resort at a profit, a place needs to get the upper middle class Managua custom. Foreigners may pay the bonus, but they won't keep a mountain resort open (ask Selva Negra).

I suggested Nicaragua to my friend who went to Guatemala. After seeing her photographs and reading her account, I wouldn't again try to argue that one. If Guatemala wins its crime war, it will get most of the tourists to the region who aren't surfers.

Tourism can and is being capitalized by Nicaraguans, including Rosario Morillo and the Pellas family. If Nicaraguans are invested in tourism at the ownership level and if the owners have political connections, they'll do what needs to be done to make Nicaragua as tourist friendly as possible. If it's something under foreign control, it's more likely to be resented. This isn't to say that Nicaraguans are better bosses than foreigners -- often, from what I've heard, they're not.

What I'd like to see here would be something like the Japanese push for industrialization, an elite school that drafts the brightest children from all classes, putting money in developing high tech industry and finding niches that other countries haven't developed (the canal is an obvious one that Nicaragua can do that other countries in the region could not do as cheaply).

The smart thing to do is not what other countries in the region are doing, but something they're not doing and preferably something they can't do. Trying to compete with places that either have long standing developed tourist industries (Costa Rica) or more attractions (Guatemala, El Salvador, Belize, Mexico) tends to leave Nicaragua as the budget attraction. Morgan's Rock is one model, but again, it's on the coast.

Also, I would like US immigration by Nicaraguans to be as easy as immigration to Nicaragua. And some state scholarships to MIT would be nice, too.

If all a foreigner can contribute to Nicaragua is the same things that Pellas and the distant kin of Sandino can contribute, then the foreigner as an investor wasn't necessary. Most of the people who move here were never business owners in the US or if they were, failed to be particularly successful at it, and fantasized that moving here would make them big fish in the cliche ponds of their fantasies.

Costa Rica has a GINI index of .65, more income disparity than here. I'd rather see Nicaragua grow some industries that paid well in the world market. Tourist notoriously doesn't, though it provides more cash money than subsistence agriculture. But to get people to leave subsistence agriculture for hotel jobs takes significant brutality, as is being seen in Honduras now.

Rebecca Brown

I had to stop reading at....

and think they should be more like the Welsh and burn some vacation houses from time to time

Are tourists terrorists, witches or just unwanted?

Tourism is only unwanted by Rebecca

She believes they are the devil and that Nicaragua does not need the $400 million in foreign exchange that they generate.

Depends on what they're spending to get it

...and what they end up spending on social services for the displaced people who get pushed out.

I don't see tourism as all bad, but it's not all good either, and it's especially not all good when it's simply some fantasy of someone with money to burn.

What it is is low wage, seasonal work -- and even more than coffee, it depends on the economic weather in parts of the world that aren't under Nicaraguan control. It's just one part of an economic package.

Does San Juan del Sur get an average of 50% occupancy or better all year round? If so, then consider expanding, or add something different to the mix. Same question for Granada. If they're not coming now, building more won't necessarily bring them unless those new buildings are their own attractions, and then why come here when you can go to any number of other places with fancy hotels and infinity pools and string quartets playing at dinner?

If Nicaragua and the rest of CA is more prosperous, more tourism in the mountains is possible but imagining that people from other continents are going to fly in significant numbers with significant money to hang out in 5,000 foot mountains when countries above and below Nicaragua have significantly higher mountains yet strikes me as as nutty here as it was in my part of Virginia.

Tourism on the coast -- that does appears to be the ticket.

Rebecca Brown

This is not how it works!

Quote Rebecca

...and what they end up spending on social services for the displaced people who get pushed out.

Tourists create and support JOBS for the locals - To the tune of nearly $100/day which is a LOT more help than someone down here on minimum Social Security. Sure minimum wage is only about $180 but add a few bucks a day for tips. The $100 is too high for the typical SJDS tourist though.

Does San Juan del Sur get an average of 50% occupancy or better all year round? If so, then consider expanding,

A real hotel in SJDS does not operate like the one in your imagination. 50% occupancy is a killer - near 100% high season would mean near 0% low season! That won't work for the good full time local employees that are necessary.

The only ones that are close to being full are destinations for working people & backpackers. - $20-$30/night. In fact Pelican and Palermo are offering 50% discount these months to get higher occupancy & back into the black.

"

Unfortunately, it is how it works in many places

I'll try to get the book in Spanish that my friend has loaned another friend that discusses the problems with different tourist areas in Latin America. I know of other studies in the US for Montana and parts of the Appalachians. Our county administrator loaned me a book that suggested that investing in tourism was not optimal for Appalachian counties as they simply ended up competing with each other (lots of mountains in the world). For the coastal areas, the competition isn't so severe -- not as many nice sand beaches in warm places as mountains.

One kid here went to San Juan del Sur to be a bartender and ended up back here in two months, so either he got fired or the deal wasn't as nice as he thought it would be. I suspect the $100 a day in tips that Key West Pirate speculated about is mythical. I had another friend in NYC who'd been lead to believe that she'd get good tips as a bartender -- not really. Another ex-girl friend of a friend is a bartender in the DC area -- my impression was that she wasn't doing all that well, though not badly.

Be curious to know what the reality is. Here's an ad for a club in Managua: "C$3,747.50 básico más propina; Requisitos -- 1 Año de Experiencia." So, $157 and change a month plus tips. And that's Managua, so the tips need to be really quite good.

And that's the top job for getting tips most places. A waiter serves far fewer tables in a night than a bartender can serve individual drinkers.

It's not that tourism can't work for some people, but it doesn't do all the great things that people are claiming it does, and it very much preserves the division between the rich and the poor, which is why the rich like it.

At $30 a night, with 40 rooms, at 80% occupancy -- the house grosses $960 a night. Let's say the maids get $12 a day and you've got 5 of them, so that's - $60 and two front desk guys or gals who make $20 a day, so minus $40. So gross minus wages for strictly the hotel part is $860 a night, minus 30% for repairs and emergencies ($258), which leave roughly $602 a day, times 356, is a bit over $200,000 a year, from which you deduct property taxes. Not a bad deal for that hotel owner and a slightly better deal if the owner takes one of the front desk shifts. Less good a deal for more staff, more expenses. Mortgage would also be coming out of that if the hotel has a mortgage.

Let's say a mortgage of $1,000 a month. $12,000 a year, so our owner is still getting over $180,000. Minus insurance. Minus a couple of others things.

Maybe $150,000 a year for a year round beach hotel.

You can make more selling pharmaceuticals in the US or being a stock broker if you're good, and you can make far more if you have strong creative skills in software design and marketing, even now. Most doctors would make more. Very good farmers in the US on large acreage in the midwest farm belt who had first rate machinery would make more. I know of a handful of writers who make more than that.

Hotels in popular year round tourist areas are good for the hotel owner. Whether they're good for the staff is going to depend on how much the prices go up compared to the wages. If an area has a lot of richer retirees and hotel owners, then the price for land will go up and often the price for food also goes up since local farm land is converted to lots for retirees and food has be to trucked in. We've got vegetable plots around the edges of Jinotega, and larger truck farms within walking distance. And dairy cattle up the street.

At some point, the locals have to move out to find affordable housing, so their commutes to work cost more, or the hotel has to provide staff housing and meals. The market vendors make more money selling produce to the tourist restaurants than to the hotel workers, so the price of food goes up more. Better for the venders, but not necessarily better for the farmers, depending.

I suspect someone has figured out what the tipping point is.

Then there's me. I'm living in a middle class/lower middle class urban neighborhood. I may pay slightly more for food than my neighbors may be paying, but it's not enough and there aren't so many people like me to have people stop selling vegetables to their neighbors to get higher prices from expats. I can buy tailor-sewn clothes, so the local tailor gets some money. I buy odd stuff that Nicaraguans might not want at the used USA stuff store. I always pay my rent on time. I can let people use some of my gear for their own work they're doing for clients (the install using my external DVD drive). I can bring stuff back from the US or have anyone visiting me bring stuff back from the US. I could teach English but I'm kinda taught out. I'll eventually buy Spanish lessons. I can afford to take taxis a couple of times week and trips to Matagalpa a couple of times a month, and eat out a couple of times a month. And buy some toys from time to time.

While I don't bring as much in, I'm not quite the inflationary influence that the person with the $200K house and the hotel that makes $160,000 to $200,000 a year is. (The hotel workers should be unionizing at this point).

For seasonal tourism, things get even crunchier.

Rebecca Brown

So is the Mario Salinas (Toursim Minister) 2020 vision wrong?

Under his proposed Plan the growth in the number of tourists, just over 1.1 million in 2011 will be 2.5 million by 2020.

He added that another goal is to expand the 8,000 rooms available now to 20,000 rooms by 2020.

Whoppee

20,000 hotels rooms. I lived in a small town with 20,000 hotel rooms! But you have to start somewhere.

"You can avoid reality, but you cannot avoid the consequences of avoiding reality." Ayn Rand

Mheh

They really should ask Costa Rica if there are any drawbacks for tourism.

My guess is that most of this is going to be on the coast -- and coasts have an advantage over mountains in that they're a bit more limited, especially ones with good access.

Tourism isn't as good as a number of other things. It requires, on average, less thinking and far less creativity than bringing in something like MicroMetrics or a chip factory. Just requires lots of money and patience with people.

The new person with a diver for a partner stands a better chance of doing something that's not either another beach hotel or another fantasy mountain get away with hiking trails and non-existent bird guides. They need to find a place with good healthy reefs and someone with local knowledge of them.

And I find many North Americans fairly obnoxious and would prefer not bringing more of them to Jinotega, but it's not really my call.

Rebecca Brown

Are you joking Miz Brown????

QUOTE oncidiumfan:

Also, I would like US immigration by Nicaraguans to be as easy as immigration to Nicaragua. And some state scholarships to MIT would be nice, too.

Sheesh - Are you delirious?

Marvelous....

A Gringa suggesting that Nicaraguans should burn the occasional foreigners vacation home down.

How is this remotely connected with the question Fyl asked which was "How Would You Prefer to Deal with Government"...?

"I disagree with the whole premise of the question"

But you posted 800 words in two posts repeating the same story of your residency.

I rest my case

And you still resent it that I had so little trouble

...as did everyone else here who didn't use a lawyer.

Some of us here have been speculating that what Nicaragua wanted to get were people who had sub-$1000 a month pensions, who would rent or buy in towns and cities, and live like older Nicaraguans, not the sorts of people who show up here with the great big fat American style exploitative plans.

I also heard horror stories about Customs and the Post Office which turned out to be untrue. I've heard that the horrors only happen if people are bringing in lots of stuff, thus proving that they have money to burn. About everything that I import is duty-free, apparently (recently bought a DVD from Amazon).

The thing is Nicaragua is still relatively unstable and people are betting that it will be more and more friendly to outside influences over the next twenty years rather than less. I think it's still a game of chances -- and it's possible that they'll decide that invading Yankees with dollars aren't much better than invading Yankees with bullets. I hope they decide to limit foreign ownership of agricultural land here, or insist that their own displaced small farmers be allowed to emigrate to the US if they want.

Rebecca Brown

"big fat American style exploitative

plans " And who exactly is this, who is doing the exploitation? I hear of a lot more Nica on Nica exploitation than American on Nica instances. Do you have ANY specifics? One? All the people I have met with Nica employees look for ways to treat their employees fairly, and enhance their life and opportunities. Do you have a specific to validate your claims, or is this just another "all male gringos are pedophiles" broadside ??

I see Webtrainer build a VERY nice hotel for arriving tourists, with the help of his Nica wife. I see Phil building a variety of things, putting cash into a remote area that would otherwise not see real money. Others are making cash investments, employing Nicas who would otherwise have to leave their rural homes and travel to Managua or Estelí for employment. What I haven't seen is exploitation.

Show me some!

Isn't that precisely the investment that Nicaragua desperately needs to move the country forward and provide jobs for all those young kids you see running around? Where do you see them working?

And how about the money for the canal? That could put the country on the map, finally, and provide an on-going source of good jobs.. There is going to be some level of exploitation, perhaps environmental being the greatest. You don't create anything without investment, and with a project as big as the canal, breaking a few eggs. Investment is only possible with profit (and savings,, --something that is loathe to many Nicaraguans). Where does the money come to build the canal? It's investment, made possible from savings, from profits. The Sandinista government doesn't have that money, and never would. It doesn't matter who eventually finances the venture. The origin of the capital that is going to buy the shovels and pay the men to dig the ditch is precisely the same.

Nicaragua does as well as it does because of the out of country remittances from CR and the US. Remittances are a huge part of Cuba's economic success as well. Hugo Chavez has also been a fortunate accident; one who could disappear tomorrow.

Good jobs are hard to find in Nicaragua, outside of the government.

Look at tables 2, 3, 4 on the link. Compare the stats for Cubans, Hondurans, Dominican Republicans, and Nicaraguans. Nicaraguans can't find jobs in their country. Some -- "big fat American style exploitative investment' -- like CR was the beneficiary of could help change that.

http://www.thedialogue.org/PublicationFiles/cuban%20condition%20migratio...

There are abundant jobs in CR; that's why a million Nicas are working and living there. Many will settle and never return. Again and again we hear that the skilled labor (trades like masonry, tile, woodwork, electrical) are all in CR. The ones left behind are not sufficiently skilled to find work in CR, or they would be there too.

WHY does CR have that abundance of jobs? It's not the natural wealth of the country. It's the investment that has been poured into CR over the last 20 years -rather than into Nicaragua.

I don't think anyone resents your ability to secure your residency without legal help. Good for you. Many of us don't have that amount of time available, and the cost of a lawyer is a good trade-off. Dealing with the Sandinistas can be very time consuming. Why NOT hire a Nica lawyer if your situation permits, and put some money into that segment of the economy? The services my lawyer has provided me have kept me legal and on-track. The money has been well spent.

Many of us have very valid reasons for not immediately seeking Nicaraguan residency, and are not perpetual tourists. There are very real tax considerations for investors, for example. Dividends and trading gains are subject to 30% withholding, as one example. This can really start to pinch if you're in and out a lot. In fact, just about any large financial transaction that might result in a profit is subject to a non-resident 30% set-aside that can only be recovered at the end of the tax period.

Many of us are still working in the US. I can think of several who post here in that category. The implications of being a resident of Nicaragua (and therefore, a non -resident of the US) might be more complex than just the tax considerations.

Given that I never said all male gringos are pedophiles...

...you're creating a straw person here, and have been doing it for a while, and this is the sort of slimy underhanded stuff I would expect from a con man who tells people who write badly that they should have their books published and that commercial publishing is impossible to break into without contacts (I am contact-repellent and yet, I broke into commercial publishing). I don't know why you keep repeating this lie, but it is a lie. Are there some people who screw under-aged poor kids here -- yes. But I never said all of them. You obviously feel some desperate need to discredit me beyond anything I ever said. You've posted that 15 year old hookers were legal in Costa Rica (you've repeated that twice and I've corrected your mis-understand of Costa Rican law twice), so maybe you have friends who believed and acted on that. I really don't care.

The game plan for anyone in tourism is to hire cheap, agitate against increases in taxes for the local school system (mills are even more likely to pull this one, agriculturalists also), and bring in tourists from outside. Some exceptions to this -- the climbing scene at Seneca Rocks, privately owned and worked small hotels with no more than one employee and remarkably low rates for being four hours driving distance from DC). Tourism is, world wide, an attractive nuisance. I accept that it brings in some money. But often the tourism industry tends to want to block development that isn't aesthetically attractive, just as retirees often complain about the real odors of actual agriculture. As part of the economic mix, tourism is fine, but I still believe it's the least imaginative capitalist endeavor this side of absentee landlord farmers. I don't particularly like Granada Sheriff (and got the two of you confused at first), but I respect what he's trying to bring Nicaragua. And I have seen other poor areas get industries that outsiders never imagined to be possible for them because some bright poor kid went away and made a lot of money starting a business and moved the industry back home.

If I were buying land, I would hire a lawyer and I suspect I know which one of two, but my exposure to the people in Managua made me far less cynical about the people I dealt with than if I'd spent $900 for the high priced full service immigration lawyer who assured me that he fought for me against the lack of concern of the Intur and Migracion staffs.

I'm still working in the US, too, and paid self-employment taxes on my US earnings this year (at a higher rate than Romney). If I earn over $500 this tax year, I'll pay self-employment taxes on that. And if it's over $14K, I won't get SS for a year, and will be also paying taxes on it (this changes when I turn 66 or 67. Other writer friends have been bouncing in and out of Social Security, which saved them after they lost day jobs.

I won't argue with you about some Nicaraguans being as exploitive as the gringos -- and the most exploitive one of those was an old woman who'd been FSLN since forever. I also know people who do try to do the the right thing and who don't have massive turnover at their businesses. Claro seems to be an attractive place to work since I don't see turnover there.

Stereotypiing the FSLN is silly. They're people who vary as much as any other set of humans. I've met military guys who worked in Missisippi on black voter registration; military guys who could respect my opposition to the Vietnamese War as long as I respected what they'd been through; I've also met military guys who were in hysterics because a black man who is smarter than they are managed to become President of the US.

If you just said, "I'm going to try to make money on the spread between Nicaraguan wages and US wages," I could respect that, but this "I'm here to help the Nicaraguan people and maybe make money, and have an adventure" reminds me of the line about how hard it is to break into commercial print and how self-publishing is just as good (at a $2500 entry price, not counting cost of printing books). I know the line about commercial publishing is an utter con of the rubes and wannabes. So, are you being honest about this Nicaraguan adventure?

Anyone who has tried the scammer's line about how commercial publishing isn't looking for new talent gets a very cynical look at anything else he says.

We're both here because the work people do here is cheaper than the same work in the US and we have US money to pay for it. I appreciate the irony of my position. I try to deal with the ones I deal with fairly, and without condescension, and I don't have a hissy fit because they charge me thirteen cents more than they'd charge a Nicaraguan for a 15 Cordoba purchase. Anyone who wants me to care is being obscene. And I loan out my external hard drive if the kid comes to my house to use it (I don't let it out of the house because some tales about how stuff gets loan on and then disappears do appear to be credible enough).

If things in Nicaragua improved enough so that I went from being lower middle class here to being too poor to support myself without further help, then I'd cheer them on as I left on my credit-card purchased ticket back to the US, but I've never seen outsiders with big tourism plans do anything for poor places other than make them too expensive for the locals.

As for Venezuela, a woman who's lived there for a while said that the Chavez programs will continue after he's gone -- they developed a party, strong younger leadership. Whether that's true or not, I dunno, and time will tell.

I was re-reading a friend's book on gardening in hard times last night. She had a section in the book that I probably should quote because it is about the difference between those of us who are urban and believe in schedules compared to the life of an agriculturalist where schedules are not as important as making hay when the sun shines, where having slack for emergencies is far more critical than being on time or filling in all ones time with known profitable activities. She's got a Ph.D. in molecular genetics from Harvard and finds what she's going as a gardner and plant breeder to be satisfying. And she doesn't even have one hired hand (hires the plowing done, though, since she doesn't own a tractor).

I expect that people who expect to move to Nicaragua and run a farm like a factory or software production team will be very frustrated.

Also, most mountain tourism, even at places like Lake Tahoe or in the Alps, is regional. Selva Negra may have some foreign tourists, but they make their nut on people from Managua coming up to get away from the heat. I met one foreign family visiting Shenandoah National Park, but the average people there had driven up from the DC suburbs. For the Swiss Alps, the breakdown goes like this: 56.4% of lodging nights were by visitors from abroad (broken down by nationality: 16.5% Germany, 6.3% UK, 4.8% USA, 3.6% France, 3.0% Italy) -- so still mostly regional, and probably not profitable without Swiss themselves visiting their mountains). A well-connected rich Nicaraguan is in a better position to run a regional tourist attraction than people from the US who don't speak fluent Spanish and who don't know the local rich. My guess is that if you build it, you'll try to sell it on, not operate it as a tourist site.

So basically, I believe that most of the people into these mountain area tourism are jobbing bubbles. Maybe Canadians will come down to the mountains here in the winter to get away from the cold, but why here and not some place on the ocean, or some place with higher mountains and some ruins, or closer like Mexico, Cuba, or Jamaica.

The dream of mountain tourism here strikes me, daughter and sister of MBAs, as detached from the reality of mountain tourism world wide. Most of the East or West Coast in the US is around four hours from mountains. St. Louis is around a day's drive from Denver (my friend and I got a late start so stayed over and then got another late start the next day when we spent time in the Tall Grass National Park). St. Louis is even closer to the Ozarks and even not that far from mountains in eastern Kentucky. So, Chicago is about the only major population center in the US that's not 3 hours from some mountains.

If you succeed at creating a high end mountain resort that you don't immediately put up for sale but actually operate at a profit, then more power to you. I'll admit I was wrong. But trying to get me to believe in it before you actually do it is a waste of your time and makes me more suspicious of you.

Rebecca Brown

KeyWestPirate - Not Exactly

Quote KeyWestPirate:

Many of us have very valid reasons for not immediately seeking Nicaraguan residency, and are not perpetual tourists. There are very real tax considerations for investors, for example. Dividends and trading gains are subject to 30% withholding, as one example. This can really start to pinch if you're in and out a lot. In fact, just about any large financial transaction that might result in a profit is subject to a non-resident 30% set-aside that can only be recovered at the end of the tax period.

Many of us are still working in the US. I can think of several who post here in that category. The implications of being a resident of Nicaragua (and therefore, a non -resident of the US) might be more complex than just the tax considerations.

A residency *itself* has nothing to do with taxes or where you are a resident - You are still a US citizen. - Thus the "30% set-aside" withholding does not apply to you - That is for non-resident aliens - Example a Nica who invests in the US but does not live there.

The only time withholding might apply for some US based ( usually retirement) income is if you have no US address and have your money delivered here but that is easy to avoid and I have never heard of anybody in that situation. - Have your retirement deposited in a US bank.

The 330 day rule applies to the foreign earned income exclusion but that is not a one liner story - There are a lot of ifs, ands, and buts.

A US address is imperative to get any official mail from the IRS. I got audited & did not get the notice here to my Nica address in SJDS. I was assessed a $12,000 deficiency and immediate payments due & had to go to reconsideration appeal - 1 year later and lots of bucks to DHL for records delivery & it was straightened out.

A cedula is almost a necessity if for no other reason than respect for & from Nicas.

You *usually* need a cedula for:

  • Bank Account
  • Drivers License
  • Own a Car
  • Own a Gun
  • Own a Business - DGI RUC # / Alcadia business license.
  • Utilities especially cable TV & Internet
  • If your time is worth anything throw a lawyer $1000 or so and the required paperwork.

    An SA can get you fixed for some of that but I think you still need an SA based cedula??? - I dumped my SA because of the paperwork & tax requirements.

    This Is All

    very good information. I didn't realize that non-resident meant non-citizen non-resident. What I see is " Check Box if not a resident of US " and some reference to a 30% withholding rate. Beyond the US residency, a state residency determines where you get your driver's license, register your vehicles, homeowner's exemption, professional licensing . . .

    I need an SA down the road anyway, and two things you say are correct: Many things can be managed through the SA, and the every two-week tax reporting requirements are bothersome. I had hoped to establish a relationship with an accountant or bookkeeper who is already doing this, who would do this routinely for me on schedule. I was just going to let my lawyer manage this for me. I won't have any profit or sales tax to report for three years, it's just a matter of getting the forms in on time and correctly filled out. and the copies filed away safely. That shouldn't cost much. Finding the right person to do it is the challenge....That's always the challenge, isn't it ? . The SA will be addressed 1st quarter of 2013. One of the reasons I want to go the SA route is to be able to capture the investment and on-going expenses cleanly. The SA can own everything, and have a business bank account. Like in the US, having a well-defined business entity keeps the books straight. The SA will be easier to sell if it comes to that.

    I WILL (or rather, the SA will) have labor reporting requirements and taxes to be paid. I'm still unclear about much of the labor detail (despite many of your informative posts and browsing the NICA site), --and will need good advice to avoid problems. There is a reasonably-sized cooperativa next to me; they must have casual, seasonal, and full-time help. I was hoping to use their person part time. He or she might even be able to file the SA forms and send copies to my lawyer. One solution I've pretty much settled on is to pay both sides of the employment tax burden. This will avoid deducting from an already minimal wage (and fighting with the workers who don't want to pay the deductions),-- and put me in a position to pay some small percent more without antagonizing my neighbors.. Much of my work will be initially casual, by the job, or by the day or week. Giving someone more than the prevailing/minimum wage will breed contempt and loss of respect, unless some additional value is received.

    I suspect, like you found with the IRS, that the Nica tax people take whatever amount of your time that they need to fill out their day. Their time is unlimited, they have no incentive to settle things quickly, ergo, it's best to avoid any unnecessary interaction. I've already had a minimal taste of this: The municipal authorities wanted to come out and "assess" my second purchase. Probably not used to someone declaring the actual amount of the purchase price. I'm only 17 Km from Telpaneca - due north by mule. To get to my place you have to drive from Telpaneca west to the Pan Am, south to Condega, and then east up into the hills. Not bad with a car --I'm grateful for the road--, but more than a day with a bus, and then you have a 7 Km walk. So my lawyer offered to drive to Telpaneca, pick the gentleman up, and take him to the farm and back. That makes it an easy half-day. Any questions, she has the knowledge to answer them. They agree on a day, she arrives on schedule, he can't make it that day. No call. No big deal., we do it another day.

    I've already qualified for an investors residency (according to my lawyer, but we know this is somewhat in flux). I can easily meet the pensionado residency requirements. There may be more investor incentives in the coming years -or not. I suspect that many are like me in wanting to dip their toes a bit first. It only seems prudent. Nicaragua is not CR; there are still property confiscations, judicial "uncertainty", and other issues.

    90 days with a 90 day legal renewal will be more than I will ever be in Nicaragua for any given time. 90 days will probably be more than I can be away from the US for a couple of years.. Shelley will be working 13 week contracts for another 4-5 years, and spending up to 90 days in between on the farm... Her lack of US and state residency might be an issue, we just don't know. A good part of our time in Nicaragua will be spent traveling around and doing the "tourist thing". There's a lot of Nicaragua to see. I've got a lot more Spanish to learn. What's the hurry with the residency?

    Good - You are covering your bases.

    QUOTE KWP:

    I need an SA down the road anyway ... Many things can be managed through the SA, and the every two-week tax reporting requirements are bothersome.

    Yep sounds like you are ahead of things.

    You can do the tax reporting yourself if you learn how in Rivas DGI but things vary by area. - A single red "Authenticity Certificate" usually gets you certified. He hands you his book, you insert the certificate, he takes the book back.

    DO NOT fight city hall anywhere unless it is the last resort. Nicas have pride and that last thing an incompetent wants to be told is that he is incompetent. Usually if you ask they will help you. Most of them are nice guys just trying to earn a living.

    I'm still unclear about much of the labor detail ... One solution I've pretty much settled on is to pay both sides of the employment tax burden.

    The labor details are not that complex but too much to summarize here and may not be cast in concrete either depending on your local lablor board. Stop by when you are in SJDS and I can give you our interpretation and a spreadsheet for benefit calculations - Juanno has posted a summary but he forgot sick pay for a week or so which they expect.

    I pay both sides of the SS and that is a mistake - It is unrecognized & unappreciated. Instead pay an extra cash allowance for bus travel, real doctors, pharmacy, etc which is outside the benefit calculations.

    But I am a very small timer. - If you plan a big operation then you may need to be more formal.

    I've already qualified for an investors residency

    Ya the guys who did that advised me it was not worth the effort unless you are big operation. But I don't know.

    Re the $25K tax exoneration for your imports - One survival method here is don't bother - KISS - Buy a Central American car that can be repaired, custom wood furniture is a bargain and appliances are not the same as US quality but are OK.

    Your trips to the US every 90 days may mostly pay for themselves if you get organized and bring enough of the right "low value used things" back.

    You may learn like a lot of us have done - The third time you finally get it right.

    Last but not least - Don't stress about how you are gonna spend your big $$$ profits you make here ;-))

    Schedule C losses are included in your US tax return but I don't know a way to do that for an SA since these are like US "C" corps without pass throughs.

    GOOD LUCK!

    No resentment at all on my behalf

    Your hopes and your I heards suit you, that's OK.

    What would you do if like Costa Rica the pensionado minimum went up to 1,000 per month.

    So what are you complaining about?

    I get tired of the non-advice on getting residency from people who didn't do the process in person and are relying on "my lawyer said." Of course, lawyers and their friends want to make lawyers seem necessary, but they aren't in most average applications (even when people don't speak Spanish well or at all).

    Do you really want me to go into long and excruciating detail about what my plans might be if Nicaragua decided to get rid of its poor pensionados. I have lots of ideas -- and can even imagine more if I work on it.

    The last time, Nicaragua had stats on the pensions of everyone who applies for residency and knew what their market was then and decided not to raise the minimum to $1K a month or expel the ones who already had residency but whose pensions were less than $600 a month. I think they're capable of considering their options based on real data on their expatriate pensionados. They also know what increases the US gives from time to time (another one like the one last year, and my pension will be $703 a month).

    People who do extended tourism could have $5Ka month to $10K a month coming in, but since Nicaragua doesn't have any data on them, the country can't use speculations in determining policy.

    Rebecca Brown