NICARAGUA
Bolaños seeks foreign support to face internal crisis

While the political crisis in Nicaragua worsens, the population's growing rejection of its traditional leaders could be a sign of change in a system debilitated by corruption and the lack of a national agenda. Once again, president Enrique Bolaños has directed his appeals for help abroad, following recent decisions by the national Supreme Court of Justice which undermine the authority of his mandate. These include the ratification of constitutional reforms approved by the Legislative Assembly at the end of 2004, the granting of conditional release from house arrest to the convicted former president, Arnoldo Alemán, and the reappointment of deputy director of the National Police Francisco Bautista, who was ordered to resign by Bolaños. While the traditional leaders continue to battle for power over the country, the population is becoming increasingly receptive to alternative leadership options. However, presenting a viable alternative in time for the 2006 elections could prove a tough battle.

PANAMA
Police on trial amidst return of mano dura

The changes announced by Torrijos at the end of his first year in office were mainly confined to security. Adjustments to the State security systems included the appointment of a new Head of National Police (PN). The changes have been interpreted as a response to criticisms of the president's failure to keep his electoral promises concerning security. His methods have bred mistrust about the possibility of a return to militarization, while the police are struggling with low morale and face serious criminal accusations, including the abuse of minors.

REGION
Katrina teaches CA salutary lessons

The wide-ranging criticisms of his late response to Hurricane Katrina's passage through the southern United States have put president George W Bush on the defensive. and highlighted his administration's various systemic weaknesses in dealing with such natural disasters. Although the number of dead and injured is still unknown, according to most sources the main victims are Afro-Americans, Latin immigrants and poor Americans. It is these groups who implore the federal government to forget about bureaucracy and send all available aid, be this internal or foreign, as soon as possible. For Central America, Katrina demonstrates the value of heeding the lessons learned from Hurricane Mitch in 1998.

GUATEMALA
Public borrowing replaces tax hike

On September 2, the Public Finance Ministry (MINFIN) presented its proposal for the 2006 General Budget to Congress which, if approved, will result in an 83% increase in annual foreign debt for the country. What analysts find most worrying is that 77% of the proposed foreign debt either has no fixed destination _ it is left to the government's discretion _ or will be used to pay existing debts. Despite the need for more funds, the government is not planning to increase the tax take for 2006, which will stay at 10% of Gross Domestic Product (GDP), far from the 12% agreed in the 1996 Peace Accords. The government has opted for the least politically costly strategy: more foreign debt.