Nicaragua

Market overview

Nicaragua was for a while the most stable and successful economy in Central America. In the early years of the past decade it started registering a higher...

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Nicaragua was for a while the most stable and successful economy in Central America. In the early years of the past decade it started registering a higher GDP growth rate than any other country in the region. However, protests against Daniel Ortega’s government in 2018 – triggered by proposed pension and tax reforms – left hundreds of people dead in clashes with the police. Ortega has since accelerated a race to outmanoeuvre several opponents (one of them being former president Violeta Chamorro’s daughter Cristiana Chamorro) ahead of the elections in late 2021. If Ortega wins, it will be his fourth consecutive term. The US and the EU have imposed sanctions against several government members, saying the election will not be free if most opponents are in jail.

The ongoing public health crisis has added another layer of complications in Nicaragua, resulting in a significantly reduced flow of transactional work. Several firms have gone into survival mode over the past couple of years. According to the IMF, the country’s economy contracted for three consecutive years between 2018 and 2020, while that institution predicts minimal growth in 2021. 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 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 some of its administrative management 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 this.

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 down tough regional competition.

Smaller firms in this listing perform well through practice area specialisation. Aguilar Castillo Love is a case in point, having zeroed 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 the capital, particularly in the tourist hotspot of San Juan del Sur), the political and economic crisis has substantially reduced investments in that sector.

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