The Philadelphia Inquirer
December 30, 1986
taxis sputter like the economy.
MANAGUA, Nicaragua - While this
city's cab drivers are normally courteous to foreigners, there is a more
pragmatic reason why they hustle to open their doors for patrons. The
door, often enough, has lost its handle.
If the cab lacks ventilation, the passenger can simply move the floor
mat and watch the road pass below. And if that doesn't provide enough air,
the driver will gladly hand over a pair of vise grips to use as a window
crank - if there is a window to roll down.
"This is embarrassing," a driver of one of Managua's battered
cabs said as he leaped out of his 1972 Toyota to tend to several wires
that had become disconnected, stranding him at a traffic light. "But
I cannot find the parts I need, and I could never afford a new car."
A new car would cost about $6,400, payable only in scarce U.S. dollars.
The import tax would amount to another 6 million cordobas, or a little
more than $2,400. At the government-approved fares, a cabbie would require
165 customers every day for a year just to pay the tax.
Instead, the taxistas drive hacks that look like the losers in a
demolition derby. And the cabs, generally speaking, are splendid compared
to many of the twisted rustbuckets that cough rheumatically along the
city's potholed streets.
The increasingly dilapidated condition of the capital's taxis is one of
the more visible signs of the failing Nicaraguan economy, which started
out poor after the 1979 Sandinista revolution and has gone downhill ever
since, a casualty of questionable management, a resource-draining war with
U.S.-backed contra rebels and a U.S. economic boycott.
But during the last year, those tattered Japanese cars that predate the
revolution have been joined by a modest influx of new cars. Hundreds of
new Toyota pickup trucks and Land Cruisers, along with Russian-built Lada
sedans, now cruise past the carless masses waiting to squeeze into a bus.
In a nation where the Marxist-led government has set the top salary at
about $400 a year, the identity of the lucky motorists is an open secret.
"Only the comandantes get the cars," said one cab driver, who,
like many of his peers, is bitter about the Sandinista commanders who
control the government.
While anybody with enough U.S. dollars can buy a car in Nicaragua -
there is no credit available in a country with a 600 percent annual
inflation rate - the bulk of the new cars on Nicaragua's roads are going
to members of the government or its supporters.
In fact, Sandinista officials have been on something of a car-buying
spree. In a rare cabinet meeting last month, the government criticized
state-owned businesses and agencies for buying 985 vehicles this year,
costing the government about $5.3 million in scarce foreign exchange
Many of those cars were bought without the approval of the central
government, according to Rene Nunez, the secretary to the presidency; the
1986 budget had allowed only 553 new vehicles.
Nunez, in an official government communique, said some of the vehicles
had been resold to private individuals in deals that were
"questionable and also illegitimate."
At Casa Pelas, Managua's largest car dealer, the showroom contains
several never-owned, though not necessarily of most recent manufacture,
Toyotas. An official said some vehicles had been sold to private
agricultural producers, who receive part of their payment from the
government with dollar credits.
Private individuals, the official said, "almost never" buy
the cars. "Who can afford them?" she said.
Rather, most of the agency's sales have been to state-owned businesses,
which received their dollars from the Nicaraguan Central Bank.
At another dealership, selected Sandinista officials can buy a Lada
with the cordobas at below-market prices. The government treasury pays the
loss from export earnings.
Despite the recent influx of unused vehicles, the demand for the few
battered used cars remains high. In Nicaragua, as in many Third World
countries, an automobile is an ever-appreciating asset - car owners demand
as much as $1,000 for vehicles that a U.S. junkyard would charge to tow
"Nobody can replace them because you can't buy a new one,"
said Blas Alberto Morales Cuadra, a portly used-parts dealer, as he
reclined shirtless on a hammock in his Managua store. "So you do the
impossible to keep your car running."
The auto-parts business has boomed clandestinely as a result of
government control of imports and subsidizing of prices.
The Sandinistas require vehicle owners to file multiple requests for
spare parts, which critics complain go to those in the government's favor.
The subsidized prices are low: The government human rights office recently
bought a set of four new American tires for the equivalent of about $10.
Unsurprisingly, an increasing number of subsidized auto parts are being
resold on the black market for prices closer to their free-market value.
The men who work for Morales, who is known in his neighborhood as
"Taca," perform near-miracles rebuilding car parts, jury-rigging
replacements with native materials and, often, trash. If a part cannot be
rebuilt, and is not necessary to maintaining a car's forward motion, it is
jettisoned. Cars with only one windshield wiper and one brake light are
"If the car is old, and it's well-formed, it's like a lady,"
said Morales. "You can reshape her and make her run again."
But Morales has few parts to work with nowadays. Only a few stray
wrecks make their way to him since the government nationalized the
insurance business and created a state used-parts business.
People without connections or money make do with whatever materials are
A common mechanic's trick illustrates the Nicaraguans' innovative
ability, as well as the declining value of the Nicaraguan cordoba. A new
washer costs about 15 cordobas. So repairmen sometimes drill a hole in a
one-cordoba coin and use it as a washer.
While the practice has kept the nation's cars running, there are almost
no coins remaining in circulation. Pay telephones have become virtually
obsolete - nobody has any change.