What is the NIO (Nicaraguan Cordoba)
The NIO (Nicaraguan córdoba ) is the national currency for the Republic of Nicaragua, the largest country in Central American. The Nicaraguan córdoba is made up of 100 centavos, or cents, and the symbol C$ represents the money in writing. The córdoba gets its name from Francisco Hernández de Córdoba, the founder of Nicaragua.
The Central Bank of Nicaragua manages the circulation of the currency.
BREAKING DOWN NIO (Nicaraguan Cordoba)
The current Nicaraguan córdoba (NIO) is also known as the córdoba oro. The NIO circulates as both banknotes and coins. The paper notes are colorful and have denominations of 10, 20, 50, 100, 200, and 500 córdobas. Coins circulate in values 0.10, 0.25, and 0.50 centavos, as well as in one and five córdobas. The original Nicaraguan córdoba coins initially contained gold.
Historically, Nicaragua used several different currencies. The three primary types were those of Peru, Bolivia, and the US. In 1859, an executive decree spurred the market of León to issue coins known as the real dime, which was approximately one-tenth of a U.S. dollar.
In 1879, the first national notes and the cent coin began circulation. By 1888, private banks printed and issued private currencies alongside the national banknotes and those of other countries. As you can imagine, this created some chaos. This situation came to an end in 1912, with the creation of the National Bank of Nicaragua. A law for currency conversion soon followed. The conversion law set the córdoba as the official national currency, but because of unstable political conditions in the country, it took a while for it to catch on. The córdoba began to circulate more officially in mid-1913.
The Nicaraguan córdoba replaced the Nicaraguan peso in March 1912, at a fixed exchange rate of one córdoba to 12.5 pesos. In 1912, one córdoba was initially equivalent to one U.S. dollar (USD).
Continued inflation diminished the value of the córdoba. A, a second córdoba issue replaced the first in February 1988. The exchange was a rate of 1,000 first issue to one of the second issue córdoba. However, inflation continued, and in 1991, the currency revalued again. The third issue córdoba replaced the second issue at a rate of 5 million to one. The third córdoba is known as the córdoba oro.
Today, 30 Nicaraguan córdoba is equivalent to approximately one USD or about 3.5 U.S. cents.
Instability Effects the Economy and the Córdoba
The Republic of Nicaragua gained independence from Spain in 1821, as it became part of the First Mexican Empire. This union remained for only two years before the country split to become part of the Federal Republic of Central America. The country gained full independence in 1838 and years of civil war followed. The U.S. intervened to protect American citizens and interests in the area, and Marines occupied Nicaragua between 1912 and 1933. As the Marines left the area, fighting continued and increased in violence.
Several years of military dictatorship rule followed, accented by brutally and corruption. In 1979, the revolutionary-socialist Sandinistas took control of the government. The U.S. provided aid to the new government until they learned of arms shipments to El Salvadoran rebels. This U.S. involvement continued in the 1980s, as the C.I.A aided the contra rebels, until 1983 when Congress banned the funding. The country now operates as a one-party political system where all powers lay in the president and his delegates.
As one of the poorest countries in the Western Hemisphere, the economy of Nicaragua is agriculture dependent. Most income comes from the export of coffee beans and tobacco. However, due to erosion, pollution, and heavy pesticide use, the yield grows smaller each year. Mining is a growing industry, and the harvesting of lumber continues, despite environmental concerns.
Most of the population lives as subsistence farmers. According to the 2017 World Bank data, the Republic of Nicaragua experiences a 4.9% gross domestic product growth (GDP) each year. However, currently, they are also experiencing a 4.9% annual inflation deflator, which is down from a rate of 10.2% in 2011.