(Kitco News) - The Biden Administration has made it all but illegal for Americans to invest in mining operations in Nicaragua's gold industry.
Monday, U.S. President Joe Biden signed an executive order banning U.S. companies from doing business with gold mining companies based in the Central America country. At the same time, the U.S. Treasury Department announced in a statement that it was imposing sanctions on Nicaragua's mining authority and the nation's General Directorate of Mines.
According to reports, this is the first time the U.S. has identified a specific sector of the economy as potentially off-limits. There is also the possibility that sanctions can be expanded in the future to include other industries believed to help fund the government. The U.S. government could potentially strip roughly 500 government insiders of their U.S. Visas.
The new economic sanctions are the U.S. government's attempt to hold President Daniel Ortega accountable for his continued attacks on human rights and democracy in Nicaragua and his continued security cooperation with Russia.
"The Ortega-Murillo regime's continued attacks on democratic actors and members of civil society and unjust detention of political prisoners demonstrate that the regime feels it is not bound by the rule of law," said Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson. "We can and will use every tool at our disposal to deny the Ortega-Murillo regime the resources they need to continue to undermine democratic institutions."
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In 2021, gold was Nicaragua's largest export last year, with total shipments abroad of the precious metal amounting to $867.6 million. Most of that gold was shipped to the United States, according to central bank data.
President Biden's executive order follows in the footsteps of President Donald Trump. In 2018, he imposed targeted sanctions against high-level officials from the Ortega-Murillo regime.
At the time, then-President Trump said Ortega's hijacking of democratic norms, undermining of the rule of law and use of political violence against opponents posed a threat to the U.S.' national security.
