The initial overthrow of the Somoza dictatorial regime in 1978–79 cost many lives, and the Contra War of the 1980s took tens of thousands more and was the subject of fierce international debate.

Following the United States occupation of Nicaragua in 1912 during the Banana Wars, the Somoza family political dynasty took power, and ruled from 1937 until its ouster in 1979.

The Somoza era was characterized by economic development, albeit with rising inequality and political corruption, strong US support for the government and its military,[32] as well as a reliance on US-based multinational corporations.

[33] In 1961 Carlos Fonseca Amador, Silvio Mayorga, and Tomás Borge Martínez formed the Sandinista National Liberation Front (FSLN) with other student activists at the Universidad Nacional Autonoma de Nicaragua (UNAN) in Managua.

[35] By the 1970s the coalition of students, farmers, businesses, churches, and a small percentage of Marxists was strong enough to launch a military effort against the regime of Anastasio Somoza Debayle.

[35] The regime, which included the Nicaraguan National Guard, trained by the U.S. military, declared a state of siege, and proceeded to use torture, rape, extrajudicial killings, intimidation and press censorship in order to combat the FSLN attacks.

[39] Following the riots, a general strike on 23–24 January called for the end of the Somoza regime and was successful at shutting down around 80% of businesses in Managua and the provincial capitals of León, Granada, Chinandega, and Matagalpa.

[39] In the words of William Dewy, a Citi Bank employee who witnessed the Managua riots: Our offices at the time were directly across the street from La Prensa and in the fighting that followed part of our branch was burned, but not intentionally.

Led by Éden Pastora, the Sandinistan forces captured the National Palace while the legislature was in session, taking 2,000 hostages.

Somoza fled to Miami; his Nationalist Liberal Party became practically defunct, and many government functionaries and business figures overtly compromised with somocismo chose exile.

Land and businesses of the Somoza regime were expropriated, the courts were abolished, and workers were organized into Civil Defense Committees.

All sectors of the economy of Nicaragua were determined, in great part, by the Somozas or their supporters, whether by directly owning agricultural brands/trusts, or actively choosing their owners (local or foreign).

Such programs received international recognition for improving literacy, health care, education, childcare, unions, and land reform.

[54] The Los Angeles Times noted that "...the Miskitos began to actively oppose the Sandinistas in 1982 when authorities killed more than a dozen Indians, burned villages, forcibly recruited young men into the army and tried to relocate others.

"[55] The Heritage Foundation, a conservative American think tank with close ties to the Ronald Reagan administration,[56][57] charged the Sandinista government with human rights violations, including press censorship.

[58] French journalist Viktor Dedaj, who lived in Managua in the 1980s, contended that La Prensa was generally sold freely and that the majority of radio stations were anti-Sandinista.

[64] In addition to Contra units loyal to Somoza, FSLN also began to face opposition from members of ethnic minority groups that inhabited Nicaragua's remote Mosquito Coast region along the Gulf of Mexico.

[64] Upon taking office in January 1981, Reagan cancelled U.S. economic aid to Nicaragua,[65] and on 6 August 1981 he signed National Security Decision Directive 7, which authorized the production and shipment of arms to the region but not their deployment.

International observers declared the elections free and fair,[69] although the Reagan administration denounced it as a "Soviet style sham".

The national share of valid votes for president were: The Esquipulas Peace Agreement was a mid-1980s initiative to settle the military conflicts that had plagued Central America for many years, and in some cases (notably Guatemala) for decades.

On 15 February 1987, Costa Rican President Óscar Arias submitted a Peace Plan that evolved[clarification needed] from this meeting.

During 1986 and 1987, the Esquipulas Process was established, in which the Central American heads of state agreed on economic cooperation and a framework for peaceful conflict resolution.

The accord was mediated by João Clemente Baena Soares at the time as Secretary General of the Organization of American States and then Archbishop of Managua Miguel Obando y Bravo[70][71] Since Nicaraguan conflict was a proxy war between the USSR and the US.

[72][73][71][74] Since the very moment of inception, under the political guidance and technical and financial support from the government of the U.S., the existence of UNO was marked by grave structural deformations, derived from its own nature.

In its conformation concurred the most diverse currents of the Nicaraguan political and ideological range: from the liberal-conservative -traditionally anticommunist and pro-U.S., to Marxist-Leninists from moscovian lineage, openly declared supporters of class struggle and enemies of capitalism in its superior development stage.