Poverty and Business Opportunities in Nicaragua

Running head: GLOBAL BUSINESS ENVIRONMENT
Global Business Environment
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1GLOBAL BUSINESS ENVIRONMENT
Nicaragua is the poorest country in the Central America confirmed by the World Bank. The
economic condition of the country is very poor indeed. According to Abel & Lewis (2015), it is
also found that it is the second poorest country in the Southern Hemisphere as well. The GDP
growth of the country has been recorded as low as 4.5% in the year 2017 (Worldbank.org, 2018).
Image 1: (Worldbank.org, 2018).
The rate of poverty has declined in the several rural areas of the country. This is why the
people of that region have been suffering a lot in those regions. The increasing rate of the
underemployment has made everyone suffer in a huge level indeed (Dijkstra, 2013). The studies
and surveys have disclosed the fact that around 30% of the people in the country are spending
their lives under $2 per day (Worldbank.org, 2018). The plight of the poor people is so much
extreme that they are inclined to move abroad to search for the work in the urban areas (World

2GLOBAL BUSINESS ENVIRONMENT
Bank. 2008). However, the research studies have suggested that the rates of the poverty have
gone down from 29.6% to that of 24.9%, which show signs of good health of the nation and
there are scopes for improving the financial condition of the nation too with extreme poverty
level decreasing from 8.3% to 6.9% as well (Worldbank.org, 2018).
There are some important causes for the poverty in the country of Nicaragua. The lack of
opportunities available in the locations for gaining accessibility to good schools is bound to
create barriers for the people suffering from poverty. The most important source for the income
in the entire country is generally agriculture. The lack of enough scopes and opportunities further
has affected the overall growth and development in agricultural activities and has affected the
production based on the use of various technologies (Worldbank.org, 2018). With the lesser
income, new technologies are difficult to integrate in the agricultural activities, thereby
contributed to the poor production too (Croes, 2014). Some critics have argued that the natural
resources are so very limited in the country and this works as a severe barrier for the
development of the country (Hansen, 2013). Another very practical reason for the
unemployment, inequality and poverty is the past violence in the country. As stated by Mitlin &
Satterthwaite (2013), the President of the country had proposed a social security program and
the deaths have been increasing there from then. The political monopolies in the region have
been so much that it has been a barrier for the development (Mitlin & Satterthwaite, 2013).
The consequences of the poverty and inequality have been immense in Nicaragua and it
has also affected the educational level and growth in economy of the nation too. The instant
result for this is the clash between the government and the people of Nicaragua (Abel & Lewis,
2015). However, it has been seen that the government and the other sources have been trying to
reduce the poverty rates in the country (Valkila, 2009).