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U.S. senator calls for freeze of Nicaraguan aid

December 15, 2010

Indiana Senator Richard Lugar asked Tuesday that the U.S. freeze Millennium Challenge Corporation (MCC) funds intended for Nicaragua due to its military’s occupation of the Isla Calero. The idea was posed by Lugar, a member of the Republican party, in a letter to MCC Executive Director Daniel W. Yohannes.

According to Lugar, Nicaragua should be denied funding for violating the criteria of the MCC based on the decision to occupy the Isla Calero and for ignoring the recommendation of the Organization of American States (OAS) to leave the area. The MCC foundation, which was created by the U.S. Congress in 2004, provides impoverished nations with grants as long as they meet certain criteria.

“We have been in contact with members of the two parties in the U.S. Congress and see that a large number of representatives are interested in the Costa Rican case,” said Costa Rican Foreign Minister René Castro. “This action in defense of Costa Rica is a show of interest in the case, from environmentalists to lawmakers and experts in these fields.”

Nicaragua was initially awarded a 5-year, $175 million assistance package from the MCC in 2005. In 2008, the MCC froze $64 million of Nicaraguan aid in response to alleged fraudulent mayoral elections.

To date, Nicaragua has received $105 million of the $111 million aid package from the MCC.

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