Overall poverty decreases but extreme poverty increases in Nicaragua

According to the Fundación Internacional para el Desafío Económico Global (Fideg), the number of Nicaraguans living in conditions of extreme poverty (less than $1 per day) increased by 2 percentage points (7.6 to 9.5 percent) from 2012 to 2013. However, the number living in "general poverty" (less than $2 per day) decreased by 2 percentage points from 42.7 to 40.5 percent.

According to Fideg, Nicaragua has improved its poverty rate ~1% each year since 2009. That's positive but obviously slower than what is needed as Nicaragua is generally considered the second poorest country in the hemisphere after Haiti.

One of the factors causing extreme poverty to increase, the report said, is a drop in export prices on agricultural goods, primarily coffee. Thousands of temporary workers depend on farming, as do several local economies in Nicaragua.

A drop in schooling and poor education are other factors that have prevented families from escaping extreme poverty, the report said.

We probably won't know for another year but I imagine poverty rates will worsen across Honduras, Guatemala, and El Salvador as well as a result of roya (coffee rust). It's possible that some other economic development (increased remittances?) will offset the coffee impact but we shall see.

This year, the government earmarked $1.3 billion – more than half its official budget – to finance anti-poverty programs and free health and education services. Venezuelan aid also has helped fund programs for the distribution of roof sheeting, financial credits, low-cost housing and food packages for the poor.

We've already had indications that Nicaragua is suffering from Venezuela's decreased support as well.