Structural Weakness in Nicaragua : Hindrances to Economic Growth and Poverty Reduction

Despite generous debt reduction under the HIPC initiative, Nicaragua is not growing at the rate required to alleviate poverty. This paper outlines Nicaragua 's vulnerability to external changes and its inability to compete in the global market. Nicaragua suffers from severe structural problems; it has a very poorly diversified industrial structure, and its trading performance is correspondingly weak, relying on basic agricultural exports that have suffered stagnant or declining prices on international markets. Nicaragua is a clear example of an HIPC country that has achieved the criteria to enter into the HIPC initiative but is struggling to maintain sustainable economic development while trying to achieve poverty reduction.