Nicaragua is a small, open economy thatis vulnerable to external and natural shocks. With anestimated Gross National Income (GNI) per capita of US$1000in 2006, and a total population of 5.2 million, it is one ofthe poorest countries in Latin America. Forty six percent ofthe population lived below the poverty line in 2005 (while15 percent lived in extreme poverty), and the incidence ofpoverty is more than twice as high in rural areas (68percent) than in urban areas (29 percent). Nicaragua'ssocial indicators also rank among the lowest in the region,commensurate with its relatively low per capita incomelevel. Nicaragua's long-term development vision is setout in its National Development Plan (NDP), 2005-2009, whichgives greater importance to economic growth than thestrategy document that preceded it. This also serves as itssecond Poverty Reduction Strategy (PRS). The goals of thePRS incorporate the MDGs, and establish medium (2006-2010)to long term targets (2015). By 2005, the country had madesatisfactory progress on meeting the PRS/MDG targets forreducing extreme poverty, increasing net primary enrollment,and reducing infant and child mortality. This NationalDevelopment Plan is being revised by the new government thattook office on January 2007, which has expressed interest inmaintaining policy continuity in those areas that have shownprogress and tackling pending development challenges. Theseinclude efforts to improve the country's growthperformance while reducing poverty, macroeconomic stabilityas a necessary, although not sufficient, condition tostimulate growth, and reduce poverty, a special focus onsocial issues that impact the poorest, including the MDGs,and environmental sustainability. Programmatic prioritiesfor the new administration include a renewed focus onpoverty reduction using a multi-sector approach,implementing pragmatic solutions to the energy crisis forthe short to medium term; expanding water and sanitationservices with environmentally sustainable solutions; sharingeconomic growth more broadly to tackle hunger, malnutritionand poverty; placing greater emphasis on preventive healthand continuing social protection programs; extendingilliteracy programs and improving education services, andpursuing municipal decentralization, state modernization,and good governance.