Passport to Development? Local Perceptions of the Outcomes of Post-Socialist Tourism Policy and Growth in Nicaragua

Abstract

Enduring decades of dictatorship under the Somoza dynasty, several highly destructive natural disasters, a major “unnatural” disaster in the form of revolutionary conflict, and a subsequent civil war have all taken a serious toll on Nicaraguan society. Today overall poverty is second highest in the hemisphere, with 80% of the population surviving on less than US $2 a day. Crippling debt contributes to a desperate need for foreign exchange, and with an attractive tax incentive package promoting external investment, the government is turning to tourism as its passport to development. After a virtual absence in the 1980s, tourism quickly skyrocketed to the top of Nicaragua's export list in less than a decade and has remained there since 2000. Yet after more than a decade of open-door policy to foreign investors, the wealth distribution remained the second most unequal on the planet. This paper briefly describes Nicaragua's history of dictators, disasters, and delayed development, and how this relates to the nature of tourism development taking place there. Through exhaustive review of development research, government agency documents, personal work experience as an assistant ecolodge administrator, and ethnographic research with rural residents involved in the tourism industry just north of the Costa Rican border, it is concluded that tourism is not delivering on the assumed promise of economic development. By placing well-heeled travelers in a carefully controlled idyllic setting where they are presented with bargain real estate speculation and investment opportunities along the country's Pacific coast, tourism as it is currently developing in southwestern Nicaragua appears to be exacerbating inequalities by allowing greater accumulation of capital among both wealthy Nicaraguan elites and a growing number of foreign/ex-patriot investors, while furthering impoverishment of rural residents through increasing costs of living, land displacement, and legal marginalization.