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Iran Helps Nicaragua ‘Neutralize’ Effects of US Sanctions

An Iranian woman walks in a market in Tehran, Iran May 1, 2022. Majid Asgaripour/WANA (West Asia News Agency) via REUTERS
An Iranian woman walks in a market in Tehran, Iran May 1, 2022. Majid Asgaripour/WANA (West Asia News Agency) via REUTERS
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Iran Helps Nicaragua ‘Neutralize’ Effects of US Sanctions

An Iranian woman walks in a market in Tehran, Iran May 1, 2022. Majid Asgaripour/WANA (West Asia News Agency) via REUTERS
An Iranian woman walks in a market in Tehran, Iran May 1, 2022. Majid Asgaripour/WANA (West Asia News Agency) via REUTERS

Iran has pledged to supply Nicaragua with fuel, participate in oil exploration and consider investing in a refinery to “neutralize the effects of US and European sanctions and encroachments.”

These sanctions target dozens of public sector officials and figures close to Nicaragua’s President Daniel Ortega who face charges related to corruption and human rights violations.

This came at the end of a visit by an Iranian government delegation, led by Oil Minister Javad Owji.

“We will do everything in our power to ensure the delivery of fuel to Nicaragua,” AFP quoted a Spanish translation of Owji’s statements during a live-streamed ceremony.

Nicaragua imports fuel from its ally Venezuela, which is currently experiencing an economic and social crisis. Russia’s invasion of Ukraine, which led to the surge in global oil prices, has exacerbated the situation in the country, in light of US sanctions that make some of its transactions more difficult.

Ortega said discussions tackled key issues related to oil. “Petrochemical and oil projects were proposed, as well as improving and modernizing refineries and developing production in oil and gas fields.”

The two governments signed an agreement to develop oil exchanges and a contract to provide oil-derived products, without specifying its value.

Owji said the projects include the possibility of investing in a refinery in the “Bolivar’s Supreme Dream” industrial complex, which was launched by Ortega’s government in 2007 and includes a Venezuelan investment. The project’s implementation has stopped due to economic challenges in Caracas.

The minister expressed hope to continue the project’s implementation through an Iranian-Nicaraguan-Venezuelan joint investment.

Nicaragua’s government said the complex includes a fuel storage and distribution facility, which was completed with a $432 million-worth investment.

The project’s second phase requires an investment of more than $3.6 billion to construct a refinery.

Washington and Brussels have been calling for the release of more than 40 opposition figures, including seven former presidential candidates who were arrested before the November 2021 elections, in which Ortega won a fourth consecutive term.

Venezuela and Iran bolstered their ties after Washington imposed sanctions on their oil exports and against several government officials from both countries.

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France Has a New Government, Again. Politics and Crushing Debt Complicate Next Steps

France's Prime Minister Francois Bayrou makes an address after observing a minute of silence as part of an official day of mourning for the victims of Cyclone Chido which hit the archipelago on the French Indian Ocean territory of Mayotte a week ago, at The Hotel Matignon in Paris on December 23, 2024. (AFP)
France's Prime Minister Francois Bayrou makes an address after observing a minute of silence as part of an official day of mourning for the victims of Cyclone Chido which hit the archipelago on the French Indian Ocean territory of Mayotte a week ago, at The Hotel Matignon in Paris on December 23, 2024. (AFP)
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France Has a New Government, Again. Politics and Crushing Debt Complicate Next Steps

France's Prime Minister Francois Bayrou makes an address after observing a minute of silence as part of an official day of mourning for the victims of Cyclone Chido which hit the archipelago on the French Indian Ocean territory of Mayotte a week ago, at The Hotel Matignon in Paris on December 23, 2024. (AFP)
France's Prime Minister Francois Bayrou makes an address after observing a minute of silence as part of an official day of mourning for the victims of Cyclone Chido which hit the archipelago on the French Indian Ocean territory of Mayotte a week ago, at The Hotel Matignon in Paris on December 23, 2024. (AFP)

France’s president and prime minister managed to form a new government just in time for the holidays. Now comes the hard part.

Crushing debt, intensifying pressure from the nationalist far right, wars in Europe and the Middle East: Challenges abound for President Emmanuel Macron and Prime Minister Francois Bayrou after an already tumultuous 2024.

What's wrong with French finances? The most urgent order of business is passing a 2025 budget. Financial markets, ratings agencies and the European Commission are pushing France to bring down its deficit, to comply with EU rules limiting debt and keep France’s borrowing costs from spiraling. That would threaten the stability and prosperity of all countries that share the euro currency.

France’s debt is currently estimated at a staggering 112% of gross domestic product. It grew further after the government gave aid payments to businesses and workers during COVID-19 lockdowns even as the pandemic depressed growth, and capped household energy prices after Russia invaded Ukraine. The bill is now coming due.

But France’s previous government collapsed this month because Marine Le Pen’s far-right party and left-wing lawmakers opposed 60 billion euros in spending cuts and tax hikes in the original 2025 budget plan. Bayrou and new Finance Minister Eric Lombard are expected to scale back some of those promises, but the calculations are tough.

“The political situation is difficult. The international situation is dangerous, and the economic context is fragile,” Lombard, a low-profile banker who advised a Socialist government in the 1990s, said upon taking office.

“The environmental emergency, the social emergency, developing our businesses — these innumerable challenges require us to treat our endemic illness: the deficit,” he said. “The more we are indebted, the more the debt costs, and the more it suffocates the country.”

How long will this government last? This is France’s fourth government in the past year. No party has a parliamentary majority and the new Cabinet can only survive with the support of lawmakers on the center-right and center-left.

Le Pen — Macron’s fiercest rival — was instrumental in ousting the previous government by joining left-wing forces in a no-confidence vote. Bayrou consulted her when forming the new government and Le Pen remains a powerful force.

That angers left-wing groups, who had expected more influence in the new Cabinet, and who say promised spending cuts will hurt working-class families and small businesses hardest. Left-wing voters, meanwhile, feel betrayed ever since a coalition from the left won the most seats in the summer's snap legislative elections but failed to secure a government.

The possibility of a new no-confidence vote looms, though it's not clear how many parties would support it.

What about Macron? Macron has repeatedly said he will remain president until his term expires in 2027.

But France's constitution and current structure, dating from 1958 and called the Fifth Republic, were designed to ensure stability after a period of turmoil. If this new government collapses within months and the country remains in political paralysis, pressure will mount for Macron to step down and call early elections.

Le Pen's ascendant National Rally is intent on bringing Macron down. But Le Pen faces her own headaches: A March court ruling over alleged illegal party financing could see her barred from running for office.

What else is on the agenda? The National Rally and hard-right Interior Minister Bruno Retailleau want tougher immigration rules. But Bayrou wants to focus on making existing rules work. “There are plenty of (immigration) laws that exist. None is being applied,” he said Monday on broadcaster BFM-TV, to criticism from conservatives.

Military spending is a key issue amid fears about European security and pressure from US President-elect Donald Trump for Europe to spend more on its own defense. French Defense Minister Sebastien Lecornu, who champions military aid for Ukraine and ramping up weapons production, kept his job and stressed in a statement Tuesday the need to face down “accumulating threats” against France.

More immediately, Macron wants an emergency law in early January to allow sped-up reconstruction of the cyclone-ravaged French territory of Mayotte in the Indian Ocean off Africa. Thousands of people are in emergency shelters and authorities are still counting the dead more than a week after the devastation.

Meanwhile the government in the restive French South Pacific territory of New Caledonia collapsed Tuesday in a wave of resignations by pro-independence figures — another challenge for the new overseas affairs minister, Manuel Valls, and the incoming Cabinet.