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International cooperation in Nicaragua is undergoing the most drastic transformation in its recent history, driven by the closure of civic space in 2018 and the abrupt cancellation, in 2025, of programs linked to human rights, governance, and civil society.
The report “Cooperation Under Strain (2017–2025),” sponsored by the Fundación Sin Límites, reveals that the aid ecosystem has shifted into “survival mode,” where legal persecution and the withdrawal of long-standing donors have forced organizations — both inside the country and in exile — to prioritize “small, discreet, and safe achievements” over “expansive goals.”
“Between 2017 and 2025, international cooperation directed toward Nicaragua underwent significant changes in its operating models, moving from relatively programmatic schemes, with more stable institutional channels, toward more adaptive configurations, with greater emphasis on fiduciary management, intermediation, and operations conducted from outside the country,” the document states.
Ortega and Murillo turned to autocratic allies
International cooperation in Nicaragua has changed for several reasons. Some, beyond anyone’s control, are tied to the reconfiguration of the donor ecosystem, which accelerated after the terrorist attacks against the United States in September 2001. Others, domestic in nature, were shaped by the regime’s violent response to the citizen demands that fueled the April 2018 Rebellion.
The report explains the regime’s response to the shutdown of Western funding over human rights violations. The alternative strategy was to seek resources from subregional lenders, climate funds, and new autocratic allies — those that impose no democratic conditions.
The exodus began years earlier
The withdrawal of traditional aid was not sudden. In fact, it began long before 2018. Starting in 2001, donor discourse gradually shifted toward issues such as the war on terror, emphasizing three main priorities: containing organized crime, combating drug trafficking, and curbing irregular migration. The changes accelerated with the 2008 global financial crisis and the gradual withdrawal of Nordic donors, which redirected their priorities toward other regions of the world.
Still, the definitive breaking point came in response to the state’s bloody crackdown on the civic protests of April 2018. From that year onward, Nicaragua ceased to be viewed as a development partner as a democratic crisis took hold and has only deepened since. The first to freeze direct transfers to the state apparatus were the United States and the European Union, making tangible improvements in the human rights situation a condition for continued support.
Criminalizing NGOs and Civil Society
As donors reduced funding directed toward state institutions, resources began to be redirected toward humanitarian assistance and independent civil society, raising alarms within El Carmen. While the presidential couple initially reacted defensively, they soon chose to go on the offensive. The National Assembly became their main institutional weapon.
In 2020, the legislature approved the Foreign Agents Regulation Law (Law 1040), together with Law 1055, the Law for the Defense of the People’s Rights to Independence, Sovereignty, and Self-Determination for Peace. Under Law 1040, receiving foreign funding was turned into a matter of national security. By criminalizing external financing outside the regime’s control, authorities unleashed a crackdown on civil society organizations that forced many of them into exile, primarily to Costa Rica, Mexico, and Spain.
Those that survived were forced to shift their agendas toward issues considered less “toxic” by the Government, such as emergency humanitarian assistance.
CABEI, Beijing, and Moscow
Despite its political isolation, the Nicaraguan State managed to maintain a significant flow of resources, mainly backed by the Central American Bank for Economic Integration (CABEI). The advantage for the regime is that the regional bank is not subject to a U.S. veto, unlike other multilateral institutions such as the Inter-American Development Bank (IDB) and the World Bank.
In this way, CABEI became the dictatorship’s lender of last resort. Particularly under the administration of Dante Mossi, the Central American bank granted billions of dollars in funding for infrastructure, energy, and health projects.
Ortega turned to a new source of financing when he broke diplomatic relations with Taiwan in December 2021 and established ties with the People’s Republic of China. Although several Chinese companies have signed financing agreements with the regime, these contracts include the condition that Nicaragua must hand over 20% of the total amount to the Chinese company involved.
Meanwhile, Russia has positioned itself as a partner in security and health matters, particularly by supplying Sputnik V vaccines and reactivating the police training center in Managua.
The Environmental Setback: The Bio-CLIMA Fiasco
The regime’s attempt to secure fresh funding for environmental projects failed when it tried to capitalize on the climate change narrative to gain access to global funds. In November 2020, the Green Climate Fund approved 116.6 million dollars for the Bio-CLIMA project, supposedly designed to curb deforestation in the Bosawás and Indio Maíz reserves.
The result was a resounding failure. After receiving complaints from local communities and independent organizations, the Green Climate Fund ultimately canceled the project. Among the reasons cited were the high risk of clientelist capture by the dictatorship, failure to comply with environmental safeguards, and the complete lack of prior and informed consultation with Indigenous populations in the Caribbean Autonomous Regions.
Although the case exposed the limits of the regime’s financial engineering, regional banks and allies such as China and Russia continue to provide a flow of resources that supports the regime’s economic survival — albeit at a high cost. In contrast, the loss of transparency standards and the cutoff of traditional international cooperation continue to deepen Nicaragua’s isolation, something official propaganda has failed to conceal.
