Nicaragua Moves to Block U.S. Funds for Opposition

Reacting to the approval of new American aid to its guerrilla enemies, the government of Nicaragua has moved to block nearly $16 million in U.S. funds destined to strengthen unarmed opposition groups and heal child victims of the war in that country.

Nicaragua’s President Daniel Ortega announced the action after President Reagan signed a foreign aid bill combining $27 million in non-lethal aid for the Contras with the other spending programs. Ortega said the entire package “will provoke more damage, destabilization, destruction and death in Nicaragua.”

“This so-called humanitarian aid to the civic opposition will not be permitted,” the Sandinista leader said in a speech late Saturday in Managua. “We cannot accept resources from the Yanqui government for Nicaraguan children when on the other hand it is approving funds to continue killing the Nicaraguan people.”

Opposition leaders said that the blocking of $2 million approved by Congress for their movement in the coming year is another step in a growing Sandinista crackdown on all dissent. They said that La Prensa, the opposition daily newspaper, depends on American aid for much of its production supplies and will be hit especially hard.

Also barred from Nicaragua was nearly $9 million in medicine, food, clothing and other emergency relief approved earlier by Congress for child war victims, plus another $5 million worth of medicine in the new package. This would have been the first U.S. aid for nonpartisan ends in Nicaragua since President Reagan took office in 1981.

The fresh Contra aid and Ortega’s swift response stuck a new thorn in U.S.-Nicaraguan relations after nearly seven years of war and three years of a U.S. economic embargo. The two countries expelled each other’s ambassador in July after the Sandinistas accused Washington of undermining peace talks with the Contras and instigating violent anti-government demonstrations. The Reagan Administration, seeking to keep the Contra army fed and clothed during a tenuous cease-fire, argued that military pressure is needed to make the Sandinistas more tolerant of dissent.

Both programs halted by Ortega enjoyed support by liberals and conservatives in Congress. Aid for the Nicaraguan opposition is channeled through the National Endowment for Democracy, a semi-private organization funded by Congress to help democratic organizations abroad, and has doubled in each of the past two years.

Fueling Agitation

Paul S. Reichler, an American lawyer who advises the Sandinistas, said the Managua government decided to block this aid because it was seen as fueling political agitation at a time of growing cease-fire violations by the rebels.

“This is a response to a breakdown of the peace talks (in June),” he said. “The United States has become much more active in promoting chaos since then.”

Dissident leaders disputed that assertion. Ramiro Gurdian, president of the Nicaraguan Democratic Coordinate, the largest anti-Sandinista coalition, said that Ortega “is jumping all over the opposition because the Contras are weaker.” The coalition has been barred since July from holding rallies.

The Sandinistas “have been against our program from the very beginning,” said Carl Gershman, president of the Washington-based endowment. “This is an excuse for continuing the repression of democratic forces.”

Cash Aid Channeled

Until now, the Sandinistas required cash aid from the endowment to flow through Nicaragua’s Central Bank, where opposition groups could collect it in local currency at an unfavorable exchange rate. Materials bought abroad with the aid had to clear customs.

Gershman said he would contact opposition groups to see if there is a way to continue the aid. But because it is monitored by Congress and therefore on the public record, opposition leaders said they see no obvious way around the Sandinista blockade if it is seriously enforced.

“We can’t do anything under the table,” said Cristiana Chamorro, an editor of La Prensa. “We are not going to violate the law. But if we don’t get assistance from abroad, as the Sandinista newspapers do, it will be very difficult to exist.”

La Prensa has received about $50,000 in newsprint and other supplies from the endowment since the government let it reopen a year ago, after a 15-month shutdown. Other endowment funds have helped finance opposition radio stations, human rights organization and training institutes for political parties, labor unions and the chamber of commerce.

‘Dollars for More War’

Pro-Sandinista newspapers campaigned against the endowment aid. A headline in one of them, Barricada, said last week that Congress was about to appropriate “dollars for more war and a rented opposition.” It also published interviews with adolescent war orphans, who were quoted as saying they would not accept help from the same Congress that funded the Contras who killed their parents.

Congress appropriated $17.7 million to set up the Nicaraguan Child Survival Program last March, along with an identical amount for non-lethal Contra aid. Half the child relief money was to be spent inside Nicaragua through four private American agencies and the rest on young Nicaraguan war refugees outside the country.

Relief supplies had just begun to enter Nicaragua under the program when Ortega ordered it suspended last month, pending Congress’ vote on new Contra aid. Among the items trapped in Nicaraguan customs houses--and still in limbo--were a 20-foot container of medicine sent by the Roman Catholic agency Caritas, along with five trucks and a 40-foot container of food from the Seventh-day Adventist Church. The only aid to reach children in Nicaragua was 30,000 pounds of powdered milk, delivered by Partners of the Americas in August.

Complains to Ortega

Rep. Byron L. Dorgan (D-N.D.), author of the relief legislation, wrote Ortega in protest, calling it “insensitive and cruel” to deny aid to “innocent victims” of the war. Rejecting the Sandinistas’ contention that the aid was “bloodstained,” he said that Congress has an obligation to keep Contra troops fed until peace talks can resume.

Ortega said in a speech last month that he felt pressure from families of Sandinista war victims to stop the aid. Another official said the Sandinistas were divided over the aid but decided to halt it to be consistent with their prohibition of U.S. assistance to the internal opposition.

There were signs last week that one child relief effort would be allowed. The Pan American Development Foundation said it was negotiating with Nicaragua’s Foreign Ministry on details of a pediatric surgery clinic it was to build with $2 million in U.S. aid. But after Ortega confirmed the blockade on Saturday, a Foreign Ministry official said there would be no exceptions.

Roger Noriega, a spokesman for the U.S. Agency for International Development, which channeled the child relief funds, said last week that he saw little hope for the program inside Nicaragua. But he said the agency will keep the funds available until it becomes clear how strictly the blockade will be applied.

Times staff writer Doyle McManus contributed to this story from Washington.