A Nicaraguan Fish Story By Nancy J. Nelson

A Nicaraguan Fish Story

It started with a simple call from Baltimore: Should we invest in a Nicaraguan fishing business?
By Nancy J. Nelson

I picked up the phone and answered with the usual greeting.

"This is Liza Heywood." Wedging the receiver between my shoulder and my chin, I reached for the Kleenex box on my desk. Despite the early hour, the sweat was beading up on my forehead -- the air conditioning unit behind me wasn't working right. Outside it was like a sauna. Inside it wasn't much better.

The voice on the other end of the line was soft and hesitant.

"Hello, my name is Sheila Carner and I'm an American citizen. I'd like to speak with someone about investing in Nicaragua."

"Yes, this is the embassy's economic section. How can I help you?"

Sheila Carner's voice grew stronger.

"As I said, I'm an American citizen. My family has been in the seafood business in Baltimore for three generations; my husband and I run the company now. But the Chesapeake Bay area has been overfished, and it's getting hard for fishermen to survive."

"Mmmmmm." I shifted the phone receiver to my other ear and swabbed at the back of my damp neck with a Kleenex. I sighed and glanced down at my desk; files and paperwork were piled deep on every inch of available space. Boxes of office material were shoved against a wall, still unpacked. "So we're looking for other areas to branch out into -- still in the fishing industry of course -- and that's why I'm calling you."

"What can I help you with?" I asked again, more impatiently now.

"Last week my husband met a Nicaraguan at a seafood convention in Miami. They started talking, and this man told my husband about this business he has in Nicaragua. He operates a processing plant. He buys up shrimp and fish from other fishermen, cleans and packages it, then ships his product to Europe. He's offering us a chance to get in on his business."

"And he needs money for something," I interrupted. "He needs $200,000 in order to bring his processing plant up to U.S. standards," agreed my caller. "He needs to before he can begin exports to the U.S. market. In return, my husband and I will get a 20 percent share in the business, and we'll be his U.S. distributor. If it works out, this could be a great opportunity for us."

"And if it doesn't work out, you could lose everything." "But we can't afford to do that! That's why I'm calling you." The voice at the other end of the line was tinged with panic.

I suddenly felt tired. The heat and the workload were just too much. While I had been in Nicaragua for only four months, I already had a lot of experience with American citizens calling up and asking that I make their business decisions for them -- business decisions on which they couldn't afford to lose. Nicaragua seemed to attract both the get-rich-quick schemers and the slightly desperate on their last legs.

I sighed, but took out a pen and notepad.

"The fishing industry in Nicaragua can be very lucrative. Just off Nicaragua's Atlantic coast lie what some experts consider the last commercial-sized unexploited shrimp reserves in the Western Hemisphere. But what's more important is figuring out whether your Nicaraguan contact is legitimate. How long do you have to make your decision?" "One week," said Sheila quietly, her voice tight. "He'll be coming back to the United States then, and we'll have to give him either a yes or a no. My husband wanted to sign a contract with him right then and there, but I argued against it. It's all our money."

I sighed again, but wrote down all the information Sheila gave me, and promised to call her back within a few days. After hanging up the phone, I walked down the hallway to the office of my boss, Tom McMann. He was on the phone, but he motioned for me to wait for him. I slouched down in one of his cracked leather chairs, and stared out the open door to the mustard-colored hallways beyond. Tom's air conditioner was working full blast.

The embassy of the United States in Managua is an unprepossessing, dingy building. The original embassy was destroyed in the earthquake of 1972 in which over 10,000 Nicaraguans died. It had been built on a scenic spot overlooking a volcanic lake and had collapsed into the water with the first wrenching tremors. Luckily for the embassy employees, it had happened at night; only one person -- the Marine on duty -- had died. The current embassy had been hastily erected as a replacement intended to last only five years. Twenty-five years later, it's squat and graceless, resembling nothing so much as a series of double wide trailers all hooked together. But what with the budget situation at State, it's unlikely that we'll get a new building any time soon.

Tom hung up the phone and looked over at me, his fingers tapping on his desk.

"What's up, Liza?"

Tom was always in motion -- tapping his fingers, swinging his leg, twitching something. Tall with a thinness that bordered on gaunt, Tom could often be found on the front steps of the embassy satisfying his two-pack-a-day smoking habit with the other smokers -- even overseas U.S. government buildings are supposed to be smoke-free. Tom sat at his desk glowering, his normal expression. He picked up his matches and began fiddling. I bowed to the inevitable.

"I can tell you just as well outside, Tom," I said. We walked down the hall, past the Marines' post and the reception desk and out the front door into the heat. Across the parking lot, I could see the tall, graceful-looking, palm trees that bordered the edges of the compound. Steam from evaporating rainfall was rising up from the paving stones. I could feel my hair frizzing with the humidity. The sky was grey; the air was thick and hot. When I turned around to face Tom, he already had a cigarette in his mouth.

"I just wanted to consult and make sure that I was doing the right thing," I said, "and see if you have any suggestions."

I was a newcomer both to Nicaragua and to economic work. At my last post I had worked in the consular section issuing visas. And despite Tom's twitching and glowering, he had a lot of good advice to offer. He would have been a great officer if he hadn't minded so much having to deal with real live people.

Telling him about the call from Sheila Carner, I asked what I could do to confirm the bona fides of her potential Nicaraguan partner. "His name is Enrique Peralta and he supposedly operates a fish processing plant here in Managua called Mariscos, S.A."

Tom took a drag on his cigarette.

"You should go to PesCamara -- the fisheries office at the Economic Ministry. Those people can tell you about the operating license of Peralta's plant; whether there have been any complaints about it, whether he's paid up, things like that. Gilberto Aleman is the director. He's one of the few people who was kept on in his position after the Sandinistas were thrown out of power, so he knows everybody and everything."

I still had my pen and notepad. I wrote it all down. Tom took a last puff of his cigarette, threw it down, and ground it underfoot. He immediately lit up another one.

"This will give you a good opportunity to familiarize yourself with the fisheries sector. I know that we've been busy with other things since you got here, but we really can't afford to let this slide. Fisheries will probably develop into one of the busier items in your work portfolio."

"Since the seafood industry is so healthy, at least I'll be able to tell Sheila Carner that it's a good sector for investments," I said.

Tom turned his head to look at me. His hair clung to his forehead, not only because of the humidity, but also because it had started to sprinkle. The clouds seemed darker, and it looked like it would begin to rain hard any minute now. When Tom started to speak, his words were clear and measured. "You can't be too careful when an American is thinking about going into business in Nicaragua. This country has the reputation of luring investors in, chewing them up and then spitting them out in little pieces."

"Now I'm not saying that there aren't a lot of decent people here," added Tom darkly. "Just keep your eyes open. As long as you remember that you should be safe."

Tom's words were still in my mind the next afternoon as I drove up South Highway to PesCamara to keep my appointment with Gilberto Aleman. I had already asked Emilio, the economic FSN, to find out what Marisco's reputation was in the business community. At a red light a weary looking woman with a toddler on her hip trudged by. I automatically lowered the window a few inches to drop some coins into her outstretched hand, then quickly cranked it up again as the hot, humid air blasted in. The woman continued slowly down the row of stopped cars, followed by vendors selling sunglasses, batteries, peanuts and sweetbreads. The light turned green and I drove on, arriving at PesCamara within a few minutes.

The fisheries office was housed in a sprawling, one-story building, with walls of concrete blocks painted light green and a roof of corrugated metal. The building was air-conditioned, however, and I thankfully left the heat outside as I passed through the front door. Although the waiting area was dark and dingy, I didn't have to wait long. A sullen-looking receptionist soon indicated that the director was ready to see me.

"You can go through there." She made a motion with her chin towards a rear door.

The office I stepped into was shabby but expensive. The low hum of Gilberto Aleman's air conditioner masked any sounds from outside the office. Light from highly placed windows, soft and diffuse, illuminated the dark wooden desk and work area at one end of the office, and a leather furniture seating arrangement at the other. Appropriately for a fisheries office, an end table by the leather sofa held an elaborate fish tank, complete with live guppies. "Liza Heywood, I'm so pleased to meet you."

The man who came forward was 50-something, light-skinned and chubby, dressed in chinos and a guayabera. Taking my hand, Aleman gallantly pressed his wet lips to my fingers -- a custom I've never been fond of. I noticed his forehead was decorated with beads of sweat. "Please sit down."

"It's an honor to be visited by the American embassy," said Aleman as we settled on the small couch. His smile didn't quite reach his eyes.

"It is very generous of you to agree to see me on such short notice," I replied in kind. "I have very little time to get the information I need, so I am very grateful. As I said on the telephone, I would like to discuss Nicaragua's fishing industry. An American company called me to ask about the advisability of putting a great deal of money into a fish processing plant called Mariscos S.A. I believe that Enrique Peralta is the owner."

I had expected that the Nicaraguan official would encourage U.S. investment in his country, and I wasn't disappointed.

"Any American investor would do well to work with Señor Peralta," he said. "Although Don Enrique is young -- still in his thirties -- he is a very hard worker and very responsible. From what I have observed of Mariscos, it has the potential to become one of the largest processing operations in Nicaragua -- maybe even in Central America.

The company is very professionally run."

Aleman said more things about Mariscos, all to Peralta's credit. After about half an hour I stood up to go. My eyes strayed to the guppies swimming placidly in their tank, and then to some old photos in elaborate frames on a shelf. I walked over to them.

"Who is this gentleman?" The man in the black and white photo, dressed in the fashion of thirty years earlier, stood proudly on a dock next to a large tuna measuring almost his height. I stepped aside as Gilberto Aleman came up behind me too closely.

"My father," he replied, picking up the photo and examining it. "He was a very skilled sports fisherman. He participated often in contests, and won many trophies." I was hard pressed to find any resemblance between the dapper gentleman in the photo and his chubby son standing next to me. I did, however, recognize another person in the photo standing just behind and to the side of Aleman's father -- the dictator Anastasio Somoza. It was curious how the father could be in with the Somoza family and the son with the Sandinistas.

I remarked upon this the next evening to Juanita Londono, the commercial attaché at the Colombian embassy, as we waited in line to get a glass of wine at a reception for an Italian chamber music group that was touring Central America.

"Many Nicaraguans are skilled politicians. They have to be in order to survive," she said with a toss of her head and a laugh. "Whatever it takes to protect their interests is what they'll do. But at least Gilberto Aleman is knowledgeable. I've had to go to him several times with fishing industry problems, and he usually is able to point me in the right direction. I suppose that's what happens when you spend so much time in one job -- when the job is handed down from father to son."

"Father to son?" I asked. But we had arrived at the head of the line, and Juanita and I were asked our wine preferences. As we picked up our glasses and moved a few steps into the crowd I changed the subject slightly. "I went to PesCamara to ask about a potential investment that an American company wants to make. A fish processing plant that needs money to upgrade to U.S. standards."

"That sounds like Enrique Peralta's old story." Juanita took a sip of her wine and gave a hollow laugh. "I wish I had thought to ask Aleman about Peralta when a Colombian firm asked me about investing in that plant; he might have saved us a lot of trouble. Peralta's bad news."

As I opened my mouth in surprise to ask her to clarify what she'd just said, Juanita was pulled away by a couple of acquaintances who wanted to introduce her to another friend. How had she known whom I was talking about? In any case, it was clear she thought poorly of Peralta -- and just as clear that she assumed Aleman had warned me to avoid him. I never had the opportunity to tell her that Aleman's recommendation had been just the opposite. I wasn't any closer to knowing what to tell Sheila Carner than when I had started.

The next morning I found Emilio, the economic assistant, in the commercial library making up packets of promotional material for a trade show. He looked up and smiled as I came in, but didn't stop what he was doing.

"Buenos días, Liza. Do you want to know what I found about Peralta and his company?"

I slumped down in a chair at the table opposite him, and started to help assemble packets. "Let me go first. PesCamara couldn't praise Peralta highly enough, but the commercial attaché at the Colombian Embassy warned me off. I never got the details from her, but she doesn't think much of Enrique Peralta."

"That's because that Colombian company lost so much money."

"What? You know about it? Tell me what happened!" "Well, it's only rumors," began Emilio, "but everyone involved in the seafood business seems to agree on the main points." He moved a pile of sealed envelopes over to one side and began addressing them. "A Colombian company put money into Mariscos -- I think it was about $150,000. Then Peralta declared bankruptcy. A month later Mariscos was up and running again, but since he had previously declared bankruptcy, Peralta didn't have to pay the money back."

"Isn't that illegal?" I asked.

"Not under the Napoleonic Code," he said. "And this wasn't the first time; someone I talked to vaguely remembered a German firm complaining about something similar happening, but couldn't give me any details."

"I still don't understand why Gilberto Aleman recommended Peralta so highly."

"Money," he said. "Maybe Aleman doesn't think that the normal profits from Mariscos are high enough."

"Why does what Aleman thinks about anything matter?" I asked. I stopped making up packets and gave Emilio my undivided attention. "Peralta is the one who gets the profits."

"Again, it's only rumors, but it looks like Peralta's only a front man," corrected Emilio. "He used to work for Aleman at PesCamara, then Aleman set him up at Mariscos and calls the shots."

"But that doesn't make a lot of sense," I said. "Why would Aleman jeopardize his position in PesCamara to engage in something like this?"

At this Emilio stopped addressing the envelopes and turned to me. Speaking very slowly, as if to a child, he said, "That's the whole point. He has the position so that he can keep better track of all his business interests. He has his fingers in everything connected with the fishing and seafood industries in Nicaragua -- the granting of fishing licenses, the ownership of the only refrigerated cargo planes certified to fly internationally, a monopoly on the import of boating equipment. Besides the Mariscos operation, Aleman has two other seafood processing plants. And you should notice that when the Mariscos plant declares bankruptcy and shuts down, it's always during the three months when shrimping is prohibited, so he doesn't lose any money. In the position of PesCamara director, Aleman can see everything that happens in the fishing industry. It's his control center."

"But that's only rumor," he said. Taking the next envelope off the pile, Emilio looked up at me and added, "Aleman inherited the business from his father. This is the way it's always been."

I didn't have to look long for Tom; he was in front of the embassy halfway through a cigarette. I spilled out the entire problem to him right there on the steps. "Aleman is operating a scam," I concluded. "He's deliberately encouraging foreign firms to invest money in his company which will declare bankruptcy and shut down as soon as the funds are received. Where do we go from here?" Tom stubbed out what was left of his cigarette and squinted out into the sunlight. His eyes seemed to follow the progress of a small iguana on the opposite curb, but I knew that he was upset when he started speaking without lighting up another cigarette.

"It's always hard when your contact turns out to be crooked. You don't want to complain about it to the local government, because they may take it as criticism of their political system or their basic ability to govern. Why rile things if you can't change them anyway?" Tom ran his hand through his hair in exasperation, and the little iguana jumped off the curb and scooted behind a bush covered with brilliant red flowers. "We're going to have to run this one by the ambassador."

Glumly, he turned and went inside. I followed. Ambassador Jessica Arthur was a political appointee. Having made her money in Texas oil, she was smart, tough and beautiful. She was seated in an easy chair, and looked up as Tom and I entered. Her sandy blond hair, expertly done up, was set off by her expensively-tailored grey suit. A pink silk blouse and bright red nails added color to the ambassador's ensemble. Her face broke into a smile when she saw us.

"Tom, Liza, come on in." Her Texas drawl was like honey.

"We have a problem, ambassador," said Tom without wasting any time. "A Nicaraguan government official appears to be involved in cheating investors. It's something Liza ran across, so I'll let her tell you about it."

I had expected Tom to do all the talking, so I was caught unprepared as their faces turned towards mine. I started out hesitantly with Sheila Carner's phone call, then gained speed as I became involved in my own narration. By the time I was detailing Gilberto Aleman's web of commercial interests in the fishing industry, I was feeling indignant.

"I think we should handle this quietly," suggested Tom.

"Confronting the government will get us nowhere. Aleman is too well connected, and his family has been doing this for at least two generations. If we lodge a complaint it will be seen as insulting to the Nicaraguan government -- our bilateral relations will deteriorate for nothing. We should just deal with the problem on a case by case basis."

I slowly counted to 10, then burst out, "An individual in his capacity as a Nicaraguan government official is working to cheat U.S. businesses -- and other foreign businesses as well. It doesn't matter that Aleman's well connected; we don't have any choice. We have to at least go to the Nicaraguan government and lodge an official complaint. This guy can't be left to continue on as he's doing. We won't be doing Nicaragua any favor by pretending everything is okay."

"But Liza," countered Tom, "we can't change something so ingrained in the society. It's not just this one man; it's the entire system. We won't make a difference." "But it's our job to try," I said.

We continued back and forth in that vein for the next 20 minutes. I was vexed and angry; Tom was cautious and placating. It was the first time I had ever opposed a supervisor in the Foreign Service, and I felt like I was butting my head against a wall.

Ambassador Arthur stayed largely out of our argument, watching the back and forth intently but making few comments. However, it was Jessica Arthur -- the political appointee -- who brought up something neither Tom nor I had thought of. She asked, "How would Congress react if it found out that an American company was cheated, and we just sat here and did nothing?"

That settled it.

Actually, it turned out better than we expected. The complaint lodged by Tom turned out to be a catalyst. The Nicaraguan government convened an official committee which, after a review of the several complaints that had been made against Aleman in the previous years, decided to name a new director to PesCamara. The official reason given was that "Gilberto Aleman has informed us he will step down in order to pursue private business interests." I felt almost giddy when I found that out. It was proof that sometimes we can make a difference.

The reception officially introducing the new director was a fancy affair, held in one of the small ballrooms of the Intercontinental Hotel. As I waited with Emilio in the receiving line, I eyed the tables heavily laden with shrimp and lobster across the room. The seafood industry was catering the affair. People moved forward, and it soon was my turn to greet the new director.

The man to whom I held out my hand was in his mid-thirties; slightly built in a good looking sort of way. And although I couldn't put my finger on anything, he looked vaguely familiar. It wasn't until he took my offered hand, lifted it to his lips and kissed it, that recognition dawned. I began to feel ill.

"I'm sorry," I said faintly, "but I was never actually given your name."

"Javier Aleman at your service," he said gallantly.

"Gilberto's son. But of course who else would I be? There will always be Alemans at PesCamara." Nancy J. Nelson is an economic officer in Tallinn, Estonia. In addition to two Washington tours, she has also served in Caracas and Managua.