The Nicaraguan Poverty Problem: Addressing the Opportunity Gap Between Rural and Urban Communities and How to Move Forward

The following brief provides a comprehensive analysis of the poverty issue plaguing Nicaragua, including an evaluation of the historical causes leading up to the nation’s current socioeconomic state, past attempts to amend the issue, and a variety of potential solutions to work towards ending the current poverty epidemic.

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December 1, 2023

Inquiry-driven, this project may reflect personal views, aiming to enrich problem-related discourse.

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Abstract— The following brief provides a comprehensive analysis of the poverty issue plaguing Nicaragua, including an evaluation of the historical causes leading up to the nation’s current socioeconomic state, past attempts to amend the issue, and a variety of potential solutions to work towards ending the current poverty epidemic. While each solution is unique in its nuances and implications, all of them draw from the primary goals of supporting rural workers, encouraging agricultural sustainability, reforming government assistance and healthcare options, and expanding education options, all with the mission of breaking generational poverty, ending the opportunity gap between the country’s urban and rural communities, and helping Nicaragua thrive.

Executive Summary

Nicaragua is currently facing a socioeconomic crisis, with thousands upon thousands of Nicaraguan citizens living below the poverty line. This brief discusses the various historical causes that have led up to such a disastrous economic state and the routes that the Nicaraguan government can in working towards resolving this issue and helping the Nicaraguan people to prosper.


Despite being the largest country in Central America, Nicaragua is the poorest nation in the entire region. The horrific poverty rates we see in Nicaragua today have a wide variety of causes, most notably the Sandinista-Contra war and current internal political disputes that have contributed majorly to societal instability.

Still, while past historical events leading to the current dilemma cannot be helped, the Nicaraguan government has the power to transform the current state of Nicaragua into a thriving one at the social and economic level by providing direct accessible aid to Nicaraguans across classes and regional divides by offering resources to not only better the current standard of living for all citizens, but also to break the poverty cycle for generations to come and strengthen the Nicaraguan economy.

Pointed Summary

  • The effects of political instability and the opportunity gap between urban and rural communities have ravaged Nicaragua, so much so that a major portion of the country’s population is beneath the poverty line
  • By allowing for such standards of living to continue, the Nicaraguan government is letting resentment build to the point where there could very likely be another uprising
  • To address the primary issue the country faces of poverty and rectify the horrible current standard of living, the Nicaraguan government must enact focused policies that address the actual day-to-day issues that Nicaraguan citizens face in their lives as opposed to providing general and ultimately ineffective band aid solutions


It is clear from the recent uproars from the people, that the government’s current refusal to enact meaningful, tactful ways to reduce the national poverty crisis has deeply angered the Nicaraguan people, but also reinforces regional divides while greatly affecting international relations. The areas with the most concentrated amounts of poverty mean that the Nicaraguan government is providing absolute minimal support for rural residents even though the country depends on their labor for agricultural exports.

Combined, both dilemmas set the country up for even worse political instability, an issue that has haunted Nicaragua ever since the bloody Sandinista-Contra war began and an issue that will persist unless it is addressed through direct diplomatic means, starting with socioeconomic solutions that start from helping people succeed on an individual level and moving from there towards national, unified economic prosperity.

Current Stances

Currently, there is one major plan being implemented to address widespread poverty. According to the Orincoco Tribune, in July of 2021, for instance, Ivan Acosta, Nicaragua’s minister of housing and public credit, presented a primitive plan that would tackle this issue head-on, dubbed the “National Plan for the Fight against Poverty and for Human Development.” The plan is outlined to last until 2026.

The proposal itself is built upon 12 principles: resolving gender inequities, reinforcing macroeconomic stability, laying the developmental foundation, stabilizing production, public services, creative economics, the role of youth in development, commercial improvement, securing cities, combating climate change, developing the Caribbean coast. 

While these principles are certainly necessary for a plan that would properly address the issues that are contributing to the poverty situation, they ignore one crucial part of the equation: rural development and rural workers. The Nicaraguan economy is extremely dependent on agricultural exports of products such as coffee, maize, rice, and sugar cane, with 30% of the labor force working within the agricultural sector.

Therefore, to properly expand the agricultural sector and reinforce this strength within the Nicaraguan economy, we must develop a policy that stabilizes rural areas in order to compel others to partake in the practice and ensure that those who are farming are producing quality products out of choice and not simply necessity since they are often unable to access many of the luxuries that urban areas have, such as well-developed educational resources and learning institutions.

Tried Policy

The vastness of the Nicaraguan poverty epidemic is simply impossible to ignore, and indeed there have been policies that the federal government has enacted in an attempt to combat the issue.  The “National Plan for the Fight against Poverty and for Human Development” mentioned in the previous section is currently in place, but prior to the current version, there have been two other editions of the plan enacted, one lasting from 2009-2011 and the other lasting from 2012-17.

All of them put forth the same mission of addressing the national poverty issue, but do little to publicly address any specific actions the government is planning to take to do so, therefore all of which, including the most recent one, seem to be thoroughly ineffective thus far.

Policy Problem


From a big-picture perspective, the United States Office of Management and Budget would be a key stakeholder in the issue. To properly enact any sort of meaningful reform and avoid negative economic consequences, it would be necessary to have the federal Nicaraguan government rework and allocate additional funds to each state so that they can properly enforce any proposed policies.

In addition to managing and delegating funds, district governments would also need to draft legislation with a proposed outline of specific regulations in order to ensure that policies are properly enforced. While the short-term reorganization of budgets on any level may be tough, the vast majority of organizations, whether it be at the federal government level or the local level, undergo budget renovations constantly regardless.

   In regards to the economy, Nicaragua would majorly benefit from meaningful efforts directed toward ending poverty. Poverty almost always correlates with unemployment or low wages, meaning that policy resolution would have to include job creation to some extent. With the creation of jobs, more Nicaraguans are able to contribute to the national GDP. If action is taken to ensure that they are paid well, then those same workers are also more valuable consumers, as they have more spending money for goods and services that are beyond what is necessary for day-to-day survival.

The most affected stakeholders, of course, would be Nicaraguan citizens. With the creation of more varied employment opportunities, support in the acquisition of necessary day-to-day resources, and aid in accessing materials pertaining to economic stability, the standard of living and overall enjoyment of life for a major portion of Nicaraguans would significantly increase.

Efforts directed towards tackling an issue as immense as poverty may seem intimidating, but with such action we are enabling hundreds upon thousands of individuals to contribute to the economy in creative ways while ensuring that cycles of poverty remain broken for generations to come through efforts such as educational initiatives. With educational initiatives in particular, we are enabling Nicaragua to have greater representation in the global knowledge economy while boosting both the national literacy rate and GDP.

Risks of Indifference

The poverty epidemic in Nicaragua is simply an issue that the country cannot afford to ignore, particularly with increasingly fraught internal tensions between the national government and Nicaraguan citizens. This recent rise in resentment can be seen most clearly through the exploration of the 2018 uprisings. Concentrated in Masaya but echoing all throughout the country, 2018 brought the worst conflict the country has seen since the revolution.

In April of 2018, a small group of demonstrators were rallying together when all of a sudden, the protest was crushed by a pro-government militia. This unprovoked attack sparked movements across the country with hundreds of fatalities as a result.

The people were rallying not just to avenge those who were unjustly killed, but because they were desperate for reform to the national pension system. In response, the government approved a plan that improved social security. However, national tensions have remained fraught ever since, meaning that if the Nicaraguan government continues to ignore the poverty plague seeping through every part of the country, particularly the effect it is having on rural communities, it is very likely that the country will face an uprising that affects every aspect of the Nicaraguan status quo for the worst.

Nonpartisan Reasoning

 Regardless of the political views Nicaraguan governmental representatives have, equity is a right that must be fought for and protected by our governments across party and identity lines. We cannot allow the Nicaraguan people to continue to remain set up to become trapped in a cycle of generational poverty.

This cycle is particularly common in rural areas, where according to the Borgen Project, 50% of the population live below the poverty line, and 11.5% live in extreme poverty, meaning that rural communities are often left without reliable food, healthcare, electricity, and so forth. We cannot allow regional or class divides to get in the way of equitable opportunities for prosperity and truly work towards ending the Nicaraguan poverty crisis, it is imperative that this issue is treated like the emergency that it is.

Policy Options

Consolidate and Expand Education Systems

Nicaragua has several quality universities, but they are highly concentrated in urban centers such as Managua, making secondary education completely accessible for a large portion of the population due to not only tuition costs but also distance and a lack of reliable transportation.

Citizens should have the right to choose their profession of choice and not simply resort to agriculture to make ends meet. With the expansion of education systems through the establishment of campuses in rural areas of the country, particularly in the North and Caribbean coast which tend to face more concentration of poverty, and in offering a wider variety of government-sponsored scholarships, we can not only increase the standard of living for thousands, but improve the national economy as a whole by increasing Nicaraguan contributions to the global knowledge economy.

Establish Reliable Utility Systems in Rural Areas

  Many of Nicaragua’s rural communities are without reliable running water sources, electricity, etc, meaning that a sizable portion of an impoverished Nicaraguan’s day very likely is solely focused on acquiring these necessary resources, shortening the window in which they could acquire a well-paying, stable job.

To address this issue, the Nicaraguan government should create a specific subdivision of their energy and water departments dedicated solely to reforming electrical and water systems in rural communities to allow for easier access to these fundamental resources. This would not only make it easier for Nicaraguans in rural areas to simply go about their daily lives, but it would also likely lower the risk of waterborne diseases since many impoverished individuals are forced to boil water or just consume it as is from local wells.

Create Community Education Programs

  To help rural communities thrive, we must not only ensure that the Nicaraguan government is making opportunities to move ahead economically more equitable, but we must also ensure that the Nicaraguan people are given direct support in doing so within their own communities. With these reforms, it is necessary to implement community education programs that are held both virtually and locally that cover a wide variety of topics that pertain to informing citizens of economic opportunities they could take advantage of.

For rural communities, it is critical that the government implements programs that compel people to enter the agricultural sector while educating the new generation of farmers in sustainable methods of doing so. This allows for families that do choose to specialize in agriculture to do so in a way that makes them and their labor feel valued by the government while taking care of the land in a way that allows for the practice to continue for generations and in a manner that protects nature.

  Additionally, the government should establish local support programs specifically directed towards women and ways they can enter the workforce. Nicaragua faces gender occupational segregation to the point of having one of the highest levels of it in all of Latin America (Herrera et al. Gender Segregation and Income Differences in Nicaragua), therefore providing government-sponsored support and resources for working women would encourage more women to enter the workforce and strengthen the national economy.

Expand the Nicaraguan Healthcare system

  Particularly in lower-income communities, the spread of HIV/AIDS has been a major problem. To address this issue, the Nicaraguan government should develop a center of communications for all things related to the disease to keep all citizens informed on the complexities of the issue and help spread awareness. Additionally, there should also be an establishment of specialized clinics with certified experts who can treat the disease. Even an action as minimal as establishing one or two clinics in each district of the country would be major in providing urgent care to those who need it most and would make it easier to expand healthcare in rural communities going forward.

  HIV/AIDs work should be the starting point for healthcare expansion due to the immense effect it currently has on the health risks of Nicaraguans, but going forward from this act, local, federally regulated clinics should be a consistent, reliable source of health support in any community.

Expand Infrastructure in Rural Areas

  In order to truly bridge the opportunity gap between rural urban areas, serious infrastructural improvement needs to occur as well. Northern Nicaragua faces constant flooding, which often limits the options of where rural residents can live and work. Organizations such as Bridges to Prosperity have built bridges as a means of overcoming the effects of these floods and they have proved successful, allowing for more to obtain industrial jobs and giving them more opportunities and easier access to secondary education institutions if they choose to follow that path.

Therefore, if the Nicaraguan government took inspiration from this action and made it a community norm, consequential economic benefits for rural communities would be overwhelming. Infrastructural change needs to happen on a level simply beyond resolutions for emergencies, however; to consistently allow for citizens to maintain an industrial job, the government should also focus on paving roads and expanding systems of transportation such as bus systems throughout the country.

Cutting Down on Over-reliance on Agriculture

  While agriculture should remain a strength of the Nicaraguan economy, it should not be the only focus when enacting socioeconomic reform plans. With at least 60% of the national GDP composed of revenue from the services sector as of 2017, the government must expand efforts to market Nicaraguan tourism in hospitality at the international level by creating jobs within the hospitality and marketing industries that can be done both in-person and remotely across the nation.

This sort of action would force a need for increased infrastructure in rural communities, but would also boost the economy in two regards: generating tourism and helping to cut down on unemployment rates. This sort of action would also almost certainly guarantee the success of an action to expand education systems as articulated in the proposal since it would encourage citizens all over the country to acquire a degree in a relevant field.

Establishment of District Councils

  Each district of Nicaragua is unique in its population culture, and struggles, and in order to enact true reform, we must hear from community members themselves to know what their communities are facing day-to-day. The establishment of district councils would be integral to his effort, as it would allow for the government to hear from all parts of the country on what is most needed in each area.

While we must work to ensure that all basic utilities are being provided, we must also ensure that from them we ensure sustainability of that stability by evolving and adapting policy solutions as needed and ensuring that they stay personalized to truly help each of the country’s 15 unique districts prosper.

Partnering with External Aid Organizations

  While there is plenty the Nicaraguan government can do to help resolve the national poverty problem utilizing its own resources, long-lasting change would take years and years of work and resources, meaning partnering with external NGOs and non-profits would be beneficial in not just providing more capital for reform actions, but would also allow for the weighing in of new perspectives of experts that a nonprofit could supply.

In addressing HIV/AIDS breakouts, for instance, the Nicaraguan government could cooperate with an NGO to pool funds to start the aforementioned clinics and use the expertise of people within the NGO who have taken on similar projects to deduce the best way to go about establishing these clinics. Furthermore, this action could also indirectly improve international relations.

Nicaragua, in recent years, has been known to be a challenging country to get into, but if the government chooses to gradually open its doors to nonprofits and NGOs, it indirectly sends the message that the country is more open to international collaboration. This, by proxy, can also support the expansion of the hospitality and service sector since it gives the same welcoming message to tourists as well.

Conclusions and Recommendations

  We simply cannot afford to ignore the effects that poverty has on Nicaragua. Though some policies have attempted to mend this issue, such as the various editions of the ‘National Plan for the Fight against Poverty and for Human Development’, and were important steps forward in their time, they simply serve as the bare minimum today. The current system does not meet the level of aid and support that impoverished Nicaraguans deserve.

I propose that the Nicaraguan government go forward with policy options that do not just provide opportunities for all citizens to advance socioeconomically, but also to ensure that they are set up for success in every regard possible, meaning that both Nicaragua’s urban and rural communities should have a choice of career path in life and flexibility to indulge in simply enjoyments such as hobbies without having to worry about necessities such as food and running water.

I propose that the Nicaraguan government take action to truly demonstrate their respect for such human rights through actions such as the expansion of education systems, the establishment of reliable utility systems in rural areas, the creation of community education programs, expansion of the Nicaraguan healthcare system, expansion of infrastructure, cutting down on overreliance on agriculture, and the establishment of district advisory councils. 

  Equitable access to necessary resources is a human right, and we must hold our governments accountable when they fail to uphold this right. Nicaragua is a beautiful country, home to awe-inspiring volcanoes, beautiful beaches, majestic lakes, and so much more.

The people of those wonderful lands deserve to be treated with dignity, and in order to properly reform Nicaragua’s treatment of impoverished citizens at the systemic level, the federal government must end the stigma of poverty, break the divide between rural and urban communities, and unite the people by creating a nation that allows for citizens to choose how they live, choose how they work, and allows them to have the time and economic stability to enjoy the marvelous wonders around them.


The Institute for Youth in Policy wishes to acknowledge Paul Kramer, Carlos Bindert, Gwen Singer, and other contributors for developing and maintaining the Effective Discourse Department and associated Fellowship programming.


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Statement on Generative AI

Generative AI (Midjourney, November 2023) was used to create the image seen at the top of this page. The capstone itself is an original work from the author, Isabella Rappaccioli.

Isabella Rappaccioli

Senior Fellow, Fall 2023

Isabella Rappaccioli is a sophomore at Alliance Academy for Innovation in Georgia, USA. She is a passionate advocate on a variety of issues, but particularly on topics such on sustainability, human rights, DEI, international relations, and education justice.

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