Nicaragua's President Daniel Ortega
Nicaragua's President Daniel Ortega speaks during an event to commemorate the 38th anniversary of the founding of the Nicaraguan Army in Managua. Photo by: Reuters/Oswaldo Rivas

Nicaraguan President Daniel Ortega's regime is feeling pressure following two recent setbacks in the financial world.

The United Nations Green Climate Fund (GCF) ruled during an annual meeting earlier this month that it would not provide any money to the Bio-CLIMA project managed by the Ortega regime until it completely complies with the fund's rules.

The disbursement of $116.6 million in funding for the project, which aims to reduce deforestation and strengthen resilience in Bosawás and Río San Juan in Nicaragua, has been put on hold by the GCF. It is the first time the GCF has blocked an approved project over human rights concerns.

The decision to block the funding, which was green-lit in November 2020, was made after indigenous people from Bosawás and Río San Juan filed a complaint alleging that they had not been subject to "free, prior and informed consultation."

The Ortega regime also reportedly didn't comply with the requirement to identify an independent third party to look into the project's actions.

The indigenous people have fears regarding the Bio-CLIMA project, as they feel funding for it could increase "environmental degradation." They also think that there could be encroachment into their indigenous territories, as per El Pais.

There are already illegal settlers in the indigenous areas. They own high-caliber weapons and are under the protection of Sandinista officials.

While the illegal settlers establish industries such as mining and cattle ranching in these protected forests, the indigenous people are forcibly displaced.

Following the indigenous people's complaint, the Independent Redress Mechanism of the GCF launched a probe and found that the project had failed to comply with GFC policies.

Nicaragua has slightly more than 100 days to comply with GFC policies so it can unfreeze the $116.6 million in funding.

Adding to Nicaragua's financial woes is the Central American Bank for Economic Integration's (CABEI) decision to push back the payment of $3.5 billion by six months. The money is to expand and improve the country's highways. It is unclear why CABEI's chief Dante Mossi, who has close ties with Ortega's family, has delayed the disbursement. When Mossi decided to grant Nicaragua loans, it was slammed by many.

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