Nicaragua has traditionally relied on agricultural exports to sustain its economy. But these benefited mainly a few elite families of Spanish descent, primarily the Somoza family, which ruled the country with US backing between 1937 and the Sandinista revolution in 1979.

The Sandinistas began redistributing property and made huge progress in the spheres of health and education. They won a decisive victory in 1984 elections, but their leftist orientation also attracted US hostility and drove them to turn to the USSR and Cuba.

This set the scene for a US-sponsored counter-revolution, which saw Washington arm and finance thousands of rebels, or Contras, in order to carry out attacks on Nicaragua from bases in Honduras. The US also imposed trade sanctions and mined Nicaraguan harbours.

By 1990, when the Sandinistas were defeated in elections held as part of a peace agreement, Nicaragua's per capita income had plummeted and its infrastructure was in tatters.

Peace brought some economic growth, lower inflation and lower unemployment. But this was more than counter-balanced by the devastations of Hurricane Mitch in 1998, which killed thousands, rendered 20% of the population homeless and caused billions of dollars worth of damage.

Nicaragua's modest tourist industry - which had all but collapsed by the early 1990s - has enjoyed a revival. The country's attractions include wildlife-rich rainforests, volcanos, beaches and colonial-era architecture.

• Full name: Republic of Nicaragua
• Population: 5.7 million (UN, 2005)
• Capital: Managua
• Area: 120,254 sq km (46,430 sq miles)
• Major languages: Spanish, English, indigenous languages
• Major religion: Christianity
• Life expectancy: 67 years (men), 72 years (women) (UN)
• Monetary unit: 1 gold cordoba = 100 centavos
• Main exports: Coffee, meat, shellfish, sugar, tobacco, cattle, gold
• GNI per capita: US $910 (World Bank, 2006)
• Internet domain: .ni
• International dialling code: +505

President: Daniel Ortega

Left-wing Sandinista leader Daniel Ortega made his political comeback in the November 2006 elections, having led Nicaragua through revolution and a civil war before being voted out in 1990. He took office again in January 2007.

Mr Ortega has sought to calm fears about his Marxist past. He says he will make no major economic changes and he backs a regional free trade deal with the US.

Washington says it will work with him if he shows a commitment to Nicaragua's democratic future. The president is likely to maintain close ties with fellow socialist leaders in the region, particularly Venezuela's Hugo Chavez and Cuba's Fidel Castro.

Born in 1945, the young Ortega joined the Sandinista movement in 1963. He rose rapidly through its ranks and was a leading player in the guerrilla war against dictator Anastasio Somoza. He was imprisoned several times.

  

1523-24 - Francisco Hernandez de Cordoba completes conquest of Nicaragua.

17th-18th centuries - British plunder and extend their influence over the inhabitants of Nicaragua's Caribbean coast.

1821 - Nicaragua becomes independent, but is incorporated into the Mexican empire.

1823 - Nicaragua becomes part of the United Provinces of Central America, which also comprises Costa Rica, El Salvador, Guatemala and Honduras.

Independence

1838 - Nicaragua becomes fully independent.

1860 - British cede control over the country's Caribbean coast to Nicaragua.

1893 - General Jose Santos Zelaya, a Liberal, seizes power and establishes dictatorship.

1909 - US troops help depose Zelaya.

1912-25 - US establishes military bases.

1927-33 - Guerrillas led by Augusto Cesar Sandino campaign against US military presence.

1934 - Sandino assassinated on the orders of the National Guard commander, General Anastasio Somoza Garcia.

Somoza family dictatorship

1937 - General Somoza elected president, heralding the start of a 44-year-long dictatorship by his family.

1956 - General Somoza assassinated, but is succeeded as president by his son, Luis Somoza Debayle.

1961 - Sandinista National Liberation Front (FSLN) founded.

1967 - Luis Somoza dies and is succeeded as president by his brother, Anastasio Somoza.

1978 - Assassination of the leader of the opposition Democratic Liberation Union, Pedro Joaquin Chamorro, triggers general strike and brings together moderates and the FSLN in a united front to oust Somoza.

Sandinista revolution and US subversion

1979 - FSLN military offensive ends with the ouster of Somoza.

1980 - Somoza assassinated in Paraguay; FSLN government led by Daniel Ortega nationalises and turns into cooperatives lands held by the Somoza family.

1982 - US-sponsored attacks by Contra rebels based in Honduras begin; state of emergency declared.

1984 - Daniel Ortega elected president; US mines Nicaraguan harbours and is condemned by the World Court for doing so.

1987-88 - Nicaraguan leadership signs peace agreement and subsequently holds talks with Contra; hurricane leaves 180,000 people homeless.

Post-Sandinista era

1990 - US-backed centre-right National Opposition Union defeats FSLN in elections; Violeta Chamorro becomes president.

1992 - Earthquake renders 16,000 people homeless.

1996 - Arnoldo Aleman elected president.

1998 - Hurricane Mitch causes massive devastation. Some 3,000 people are killed and hundreds of thousands are left homeless.

2000 - FSLN win Managua municipal elections.

2001 November - Liberal party candidate Enrique Bolaņos beats his Sandinista party counterpart, former president Daniel Ortega, in presidential election.

2002 March - Opposition Sandinista party re-elects Daniel Ortega as its leader despite his three consecutive defeats since 1990.

2002 August - Former president Arnoldo Aleman charged with money laundering, embezzlement during his term in office.

2003 December - Arnoldo Aleman jailed for 20 years for corruption. A year later he is transferred to house arrest.

Debts cleared

2004 January - World Bank wipes 80% of Nicaragua's debt to the institution. President Bolaņos says it is the best news for the country in 25 years.

2004 July - Agreement with Russia to write-off Nicaragua's multi-billion-dollar Soviet-era debt.

2005 April - Rises in fuel prices and the cost of living trigger weeks of sometimes-violent street protests.

2005 June - The government and an opposition alliance, which controls Congress, become embroiled in a power struggle. OAS head Jose Miguel Insulza tries to mediate, without success.

2005 October - Political crisis eases as Congress agrees to delay constitutional reforms, which will weaken the powers of the president, until President Bolaņos leaves office in 2007.

2006 April - Free trade deal with the US comes into effect. Nicaragua's Congress approved the Central American Free Trade Agreement (Cafta) in October 2005.

2006 October - President Bolaņos unveils plans to build a new ship canal linking the Atlantic and Pacific Oceans.

MPs approve a tough new bill that bans abortions, including in cases where the mother's life is at risk.

2006 November - Ex-president Daniel Ortega is returned to power in elections.