Nicaragua was for a while the most stable and successful economy in Central America. In the early years of the previous decade it started registering a higher GDP growth rate than any other country in the region. However, proposed pension and tax reforms sparked massive protests against Daniel Ortega’s government in April 2018, and huge social unrest and political turmoil followed despite the cancellation of the unpopular measures. Several hundreds of people died in clashes with state forces and the economy has plunged as result. As of March 2020, thousands have left the country, a violent crackdown on political dissidents is not uncommon and economic sanctions from the US and the EU loom large.
The ongoing crisis has significantly reduced the flow of transactional work and many law firms went into survival mode. While several report that some transactional work returned during 2019, the year remained difficult for many. The economy is still expected to contract in 2020, according to the IMF, but substantially less so than during the previous year. However, all firms have managed to keep their headcounts steady, keeping busy on disputes, labour and tax work.
Nicaragua stands out for having one of Central America’s most regionalised legal markets. Of the seven firms listed in this chapter, only one remains resolutely local. Still, Nicaragua’s local firms have more than held their own against newcomers. García & Bodán – one of the few firms to expand throughout Central America from a Nicaraguan base – is deeply entrenched. So is regional heavyweight Consortium Legal, which bases its administrative office and presidency in Managua. Both provide a full-service offering and are considered market leaders.
Another regional heavyweight, Arias, has a smaller Nicaraguan office, but the firm’s superb partnership and cross-border clout make up for what it lacks in size. BLP is another good example of that.
Alvarado y Asociados is in a class of its own. In a country where family firms are no longer prominent, this local player is something of an anomaly, comfortably facing off tough regional competition.
Smaller firms in this listing perform well through practice area specialisation. Aguilar Castillo Love is a case in point, zeroing in on complex financial disputes work before widening its local offerings.
More broadly, corporate finance forms the backbone of nearly all the firms listed. While real estate law features prominently (leading several firms to open offices outside of the capital, particularly in the tourist hotspot of San Juan del Sur), the political and economic crisis has substantially reduced investments in that sector.