Politics, like cigars, is a delicate thing. The right balance of fire and finesse, the right blend of pressure and patience, and the whole thing can be either a masterpiece or a smoldering pile of wasted potential. And right now, sitting at the intersection of global diplomacy and old-fashioned deal-making is a cigar—more specifically, the fate of Nicaraguan cigars in the wake of Washington’s latest geopolitical flex.
It all starts with CAFTA-DR, a 2004 trade agreement that binds the economies of the United States and six Central American countries, including Nicaragua, in a web of duty-free commerce. It’s not a perfect deal, but like a well-worn barstool in a back-alley cantina, it does its job. Nicaragua, a country whose economy leans heavily on exports, has played its part in this arrangement, shipping textiles, coffee, and—most notably—handmade cigars north to eager American consumers.
But now, with the smell of political gunpowder in the air, the Trump administration’s Special Envoy to Latin America, Mauricio Claver-Carone, is floating the idea of cutting Nicaragua out of the deal altogether. The reasoning? A cocktail of human rights concerns, trade violations, and what seems to be an overarching desire to pressure the Ortega regime into playing nice.
If this were poker, the U.S. just reached across the table and grabbed Nicaragua’s chips. The potential consequences are more than theoretical: a removal from CAFTA-DR could mean tariffs on Nicaraguan goods, a move that would send ripple effects through industries that rely on the free flow of goods between Managua and Miami. And yet, cigars—those rich, earthy symbols of Nicaraguan craftsmanship—aren’t technically covered under CAFTA-DR. Theoretically, nothing would change for cigar imports. Theoretically.
But theory and reality rarely share the same bed. If the U.S. makes the decision to tighten its grip, tariffs on Nicaraguan cigars would be an easy play, a way to pile on economic pressure while still giving Washington plausible deniability. And what happens when the cost of a premium Nicaraguan puro jumps 20% overnight? Do customers shrug and keep buying? Or does a slow, painful shift begin, redirecting demand toward Dominican or Honduran alternatives?
If you’ve ever walked into a Nicaraguan cigar factory, you know the answer matters. These aren’t soulless assembly lines cranking out widgets; they’re living, breathing institutions, where generations of workers have spent their days shaping, rolling, and cutting some of the best smokes on the planet. The idea that their future could be dictated by a policy decision made in Washington by men who have never felt the weight of a fresh Churchill between their fingers? That’s enough to make any cigar lover pause and take a long, contemplative draw.
Of course, this isn’t just about cigars. The larger game at play is economic leverage. Nicaragua exported $2 billion worth of textiles to the U.S. in 2023—35% of its total exports. Major textile players like Milliken & Company have already pointed to alleged labor violations, claiming Chinese-owned mills in Nicaragua are laundering cotton linked to forced labor in Xinjiang. If these allegations hold weight, the U.S. has every reason to act. But let’s be clear: the real victims won’t be the factory owners or the regime officials smoking cigars in government halls—it will be the workers, the same ones whose hands shape the products America consumes daily.
So, what happens next? The Trump administration could move forward with its threat, cutting Nicaragua loose from CAFTA-DR and opening the door to tariffs and supply chain upheavals. The Biden administration could follow through on its own investigation into labor abuses, potentially justifying even harsher trade restrictions. Or, as is so often the case, this could be another bit of political theater—a warning shot across the bow that never materializes into an actual policy shift.
Regardless of which way the wind blows, the stakes are clear: Nicaragua’s place in the global economy is on the line, and with it, the fate of the products that define its identity. For now, all we can do is wait, watch, and light up while we still can.
by Brian Desind
