Citizens protest Spanish company's hike in electricity rates

Nicaragua Network Hotline, 3 December 2001

Union Fenosa, the Spanish company that recently took over electrical power distribution under the Aleman government's privatization drive, has announced a 15-30% hike in prices for electricity services. Ruth Selma Herrera of the Consumers' Defense League (CDL) said that, This rise, any rise, is completely beyond the reach of most people. Anastasio Somarriba of the Nicaraguan Chamber of Commerce, called the hike catastrophic, adding that most of our farming industries-sorghum, sugar, cattle-are all in grave economic difficulties. Even 5% higher electricity bills will be enough to break many of them.

Together with higher gas prices, power hikes have a ripple effect across the whole economy, affecting most industrial products, irrigation systems for farming, refrigeration costs, particularly in small neighborhood shops, all milk products and many family food items. Herrera pointed out that such staples as rice, beans and cooking oil were already at all time highs (in many cases more expensive than in the US, despite average monthly incomes of less than US$100), and that, but for the staunch resistance of Managua's mayor, Herty Lewites, bus fares would already have been raised by 25%.

Enrique Picado, of the Community Movement's National Directorate, commenting on an offer to negotiate with Union Fenosa from incoming president Bolaqos, said categorically, No! No! No and No! There is nothing to be discussed. The government and its economic regulators know the state the country is in perfectly well. There is simply nothing to negotiate. As the coalition to resist the hikes continued to grow, community leaders said they could not discount direct action in the streets.