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Aug 17, 2016 | 18:26 GMT

2 mins read

A Sign of Faltering Trust Between Nicaragua and Venezuela

A Sign of Faltering Trust Between Nicaragua and Venezuela

Venezuelan citizens, who had previously been exempt from Nicaraguan visa requirements, will now have to apply for a visa to travel to Nicaragua. The new rule is a marked shift in relations between the two countries. Since Nicaraguan President Daniel Ortega began his term in 2007, Venezuela and Nicaragua have been staunch allies, and Nicaragua is a prominent member of Petrocaribe and the Bolivarian Alliance for the Peoples of Our America (ALBA), two alliances created by Venezuela as alternatives to U.S. energy sources. But as Venezuela's economic and political crisis worsens, its relationship with its allies also suffers.

It is unclear exactly why Nicaragua has enacted these changes, but there are a couple of possibilities. For starters, Venezuela's dire economic and political circumstances will only worsen in the coming months. Nicaragua could be staving off having to grant political asylum to Venezuelan officials and to any citizens who flee to the country. But it is also likely that the Nicaraguan government is trying to limit domestic opposition.

Nicaragua's populist politics will likely be challenged in the next several years, since Ortega is aging, and assistance from Venezuela — the government's largest source of social spending — is slowly tapering. Oil shipments, a crucial part of that social spending, have already been reduced, and in the coming years, economic problems will help the opposition make gains. The Nicaraguan government is increasingly concerned about its competition and recently deported Venezuelan opposition leader Luis Florido for his ties to the Nicaraguan opposition. By screening the Venezuelans entering the country, the Nicaraguan government may be trying to distance Venezuela's vocal opposition leaders from its own.

The countries are becoming more distant economically as well. Nicaragua bought substantially less oil from Venezuela in the first half of this year compared with the same period last year. And the amount that Nicaragua spent on oil from Venezuela dropped from about $265 million in January to about $85 million in June — the largest decline since Nicaragua joined ALBA. Despite the subsidies that Venezuela offers it, Nicaragua has opted to purchase more oil from Mexico and the United States than it previously had. Prices on the open market are so low as to be almost comparable to those offered by Venezuela. Furthermore, given Venezuela's instability, Nicaragua is trying to diversify away from relying on it for energy. Whatever Nicaragua's motives, it is clear that its relations with Venezuela are splintering.

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