Nicaragua says inflation falling, to tackle crisis

MANAGUA Jan 20 (Reuters) - President Daniel Ortega said on Tuesday inflation in Nicaragua will moderate in 2009 amid slower economic growth, and pledged to seek aid from multinational lenders to weather the global economic slowdown.

Ortega, a former Cold War Marxist rebel who first ruled Nicaragua in the 1980s, said he saw inflation below 10 percent this year. Inflation in Nicaragua, one of Latin America's poorest countries, reached 13.77 percent last year.

But he said economic growth would also likely slow to 2 percent in 2009, compared to 3.2 percent last year.

Nicaragua, a textile exporter to the United States, has a loan agreement with the International Monetary Fund and has agreed to control inflation, which hit 16.88 percent in 2007, driven by higher food prices.

Ortega said in a speech that his government was seeking $500 million from the Inter-American Development Bank and the Central American Bank for Economic Integration to improve infrastructure and increase production despite the downturn.

He also pledged to cut government waste and seek new farm markets in former Cold War ally Russia.

"If we don't establish a policy of saving, there won't be anything left for anyone," said Ortega, who returned to power in 2007, adding that he planned to make $66 million in savings. (Reporting by Ivan Castro; Editing by Kim Coghill)