In 1979, the Sandinista government established itself in power in Managua, the capitol of Nicaragua. It found the country ruined by the long war against the Somosa dictatorship and natural disasters alike, and nearly half of the population either homeless or living in exile. Attempting to restructure and recover the underdeveloped economy, Sandinisas introduced a wide range of reforms and a cultural revolution.

Considering the Sandinistas to be 'Cuban-supported Marxists' and therefore a major threat to the US domination of Latin America, in 1980-1981 the USA began supporting the creation of the Contrarevolutionary forces (better known as 'Contras'), and thus helped provoke a new war that was to rage through Nicaragua until 1988.