Nicaragua will receive 600,000 fewer visitors this year.
80% of the small hotels have closed, 60,000 jobs have been cut, and the economic losses add up to US $400 million dollars.
By Carlos Saliinas Maldonado (Confidencial)
HAVANA TIMES – Xiamara Diaz juggles her resources in order to keep afloat her restaurant, the Garden Café, located in Granada. This city, the colonial jewel of Nicaragua, has suffered a severe economic blow due to the political crisis. Diaz has had to adjust to the new reality of a country that’s no longer receiving foreign tourists, and in addition has seen a downturn in local consumption.
In Granada, some 80% of the small hotels have had to close. Xiamara Diaz has had to dismiss 23 of her workers, change her hours of operation and make heavy use of her brain in order to innovate special offers and new services to attract clients.
“Just take a walk through the historic center of Granada, and you’ll come face to face with the reality of not having international tourists,” Diaz told Confidencial. “In Granada, that tourism has fallen off by 90 or 95%. It’s nearly nonexistent. Every time I see a foreigner here in the restaurant, I try to approach them and ask what they’re doing in Nicaragua. The majority are people who live in other cities in the country and are in Granada to visit,” explains the businesswoman, who in 2007 placed her bets on Granada as the best place to invest, given the city’s boom as an international tourist destination.
On the Saturday that we visited Granada, the city appeared to be in hibernation. Despite the cool climate and the special promotions in the local businesses, there were few visitors to the bars and restaurants. In Granada’s Garden Café – a locale that offers salads, sandwiches, and Mediterranean and Arab fusion cuisine – there were few diners. At 3 pm the electricity in the city went off, forcing them to close early.
That afternoon, on the street known as La Calzada, the heart of the city’s nightlife, the waiters waited for clients with weary faces, bored by their idleness. One of them, a waiter in a restaurant specializing in grilled steak who preferred not to give his name, stated simply: “business is bad.” He did note that it’s a little better on weekends, especially when it’s payday. However, he also affirmed that Granada isn’t the same city full of tourists that it was five months ago.
The political crisis began in April, when Daniel Ortega imposed Social Security reforms that were rejected by the private sector, pensioners, workers and university students. Although the reforms were later retracted, the discontent spiraled into unrest and repression, with a death toll of over 300 people. The crisis, now in its fifth month, has had dire consequences on the economy. The tourism sector has been one of the areas that has suffered most, with losses that may exceed US $400 million dollars by the end of the year, according to the Nicaraguan National Chamber of Tourism.
The statistics in red include 60,000 lost jobs, reduced operations on the part of 83% of the companies of this sector, and the scarcity of foreign tourists. Nicaragua will receive 600,000 fewer visitors due to the fact that the travel advisories haven’t been suspended, warns the Superior Council of Private Enterprise (Cosep).
Limited job options
In the case of lost jobs, those who own companies related to tourism believe that it will be difficult for the unemployed to reintegrate into other sectors of the economy, principally because they have only a basic education. Further, if they should decide to emigrate to other countries – as thousands of Nicaraguans have done – it will be difficult for them to get work in the tourism industry, because they’re not as well qualified as tourist destinations like Costa Rica require.
“We’ve been training our workforce, but we’re a fairly new destination. Our customer service and all of the capabilities that the tourist industry requires are still stuck together with just spit instead of glue. Those who’ve been best able to defend themselves are the tourist guides who speak English; these workers can find a place in other industries. However, the tourist industry is largely comprised of workers with very elementary educations and with fragile family economies,” Diaz explains.
In addition to Granada, other places are also suffering the dearth of foreign tourism: Leon, Ometepe, Tola, Corn Island in the South Caribbean, and other forest and mountain destinations. Cities such as San Juan del Sur survive the fall in foreign tourism thanks to the locals who come to this watering place for long weekends. Nevertheless, some hotels and restaurants in the city have also closed, and the crisis has affected a burgeoning real estate market.
No international tourism
“Internal tourism is scarce and concentrated on weekends. It’s very true that there isn’t any international tourism in Nicaragua right now. There been a reduction in the weekly frequency of flights – from 180 that were coming in, there are now just 70,” explains Lucy Valenti, president of the Nicaraguan Chamber of Tourism.
Valenti is one of the business owners who have suffered from the decline in tourism. She had to suspend operations in her company Touroperadora due to the lack of visitors. Some 91% of the business owners in the tourism sector consider that conditions for security, stability and peace are fundamental,” she states.
Xiomara Diaz agrees. She asserts that “we can’t play” with the foreign tourists, who need to feel secure in the destination they choose for their vacations.
“We can’t be telling them that everything’s fine in the country, that it’s secure; and then later another crisis explodes and they relive the terror that they experienced in the month of April,” Diaz explains. “Here in the Garden Café, I had people who ended up shut in, because it was impossible to go out with any safety. The trauma that all of us went through in the country, was also felt by the foreigners, and it’s very difficult to reverse. We’ll have to take some giant steps to invite them once again, and for them to trust us.”
Daniel Ortega’s government is trying to regain the trust of foreign tourists via campaigns promoted by the Nicaraguan Institute of Tourism to once again position Nicaragua as a safe tourist destination. However, Valenti assures that those campaigns have had “no impact”, and the companies in the tourism sector continue subsisting with their accounts in the red.
She recalls that it took 28 years to build up the tourist industry in Nicaragua after the end of the armed conflict of the eighties and the political instability at the beginning of the nineties. Due to this, the tourism sector and the state will have to make great efforts to recover the lost terrain, more so since the crisis hasn’t been resolved and the world sees the reports of the international press that terror and insecurity still predominate in the Nicaraguan cities.
“We’re not going to start from zero,” Diaz feels. “We’ve already gone down the road of learning, we’ve invested a lot in the industry; but, yes, we’re going to start from a low point and it’s going to take years to revive this nearly dead body that’s our tourism,” she predicted.