Roads in Nicaragua were notoriously terrible during the last few years, but the government has improved them a lot since then. The Pan-American Highway, which runs from the northern border to the southern, is no longer a chuck-hole haven and heavy freight and travelers can do a good 120 kilometers an hour without leaving their rear axle in a pothole (a.k.a. crater). In Managua, new roads are being made and paved at a good pace, leaving very few major roads that still use the traditional blocks. There are plenty of hazards to keep you busy like manholes without covers, 3 foot ditches along the sides of the road with no railings, and thoroughly corrupt policemen.
Radar guns do not exist, neither do unmarked cars or highway patrolmen. However, even though you will never get pulled over for doing 200 kilometers an hour an an interstate or changing lanes without signaling, they make up for a lot of other things. Yield signs translate into stop signs, turning right on red is wrong, and merging before the yellow line has run out is taboo. You will never see flashing lights in your rear-view mirror or hear a siren. Instead, you will see a man wearing a blue shirt and an orange vest hold is arm out and you must pull over. The majority of the policemen here accept some coffee money, about 4 bucks, in exchange for not keeping your license (which they will do if they write you a ticket).
However, if you’re planning on ever leaving Managua, a genuine 4x4 is almost mandatory. The most popular vehicle, by far, is the Toyota Landcruiser with the Mitsubishi Montero, Jeep Cherokee, and the Nissan Patrol bringing up the rear.
You will be able to find taxis easily on major roads all over Managua. Be sure to establish the price of the fare before getting in or you could end up paying 10 bucks for a ten block ride and it would be perfectly legal -- there are no distance meters like back in N.Y. The average price for a trip is four dollars. When you go anywhere, you will see five or six guys standing in an empty parking lot who will assist you in getting into one of the 100 empty spaces. Some will run beside your car as they tap on the window, some will wave you into a space with one hand and point to their eyes with the other (if you look into their eyes it means that you hafe chosen them), and they all will gather around your door when you finally park and fight over who gets to "guard" your car. When you return from your excursion, you must give they person you chose about ten cents. The same is true for the little window-washers at the traffic lights. If your windows are already clean, you should just wave your finger "no" at them, but don’t be surprised if they wash your window anyway. Beware... the nastier individuals may leave trendy lines along the sides of your car, courtesy of their nails, if you fail to reciprocate their kindness.
Roads connect all of the major cities in Nicaragua except for Bluefields, because there’s a dense jungle in the way. There are 1600 kilometers of paved "highways" that are mostly two lane, 2000 kilometers of paved roads, 5000 kilometers of regular unpaved roads, and 8500 kilometers of unpaved roads that can only be used in the dry season.
"Buses" do go almost everywhere and they are frightfully cheap--you can get across the entire country (north-south) for about 5 bucks. The typical bus here is a pickup truck with railings welded onto the sides or old school busses.
There are five ports in Nicarauga with two Government-run ports on the Pacific. The first is Corinto, 180 kilometers northwest of Managua and it is the best port by a long shot. It handles 85% of all cargo and its 1.5 million ton annual capacity is currently being upgraded. The other one is Puerto Sandino, but its mostly used for oil and bulk cargo imports. The two ports on the Atlantic are at El Bluff and Puerto Cabezas, but they are rather limited. The last location is at El Rama, on the Rama River 40 kilometers from the Atlantic coast, but it’s more of a pier than a port.
And if you feal the blue skies calling you, there’s always Managua’s Cesar Augusto Sandino International Airport. Just 7 miles from Managua, the airport handles almost all international flights and cargo. It was recently upgraded with the addition of cold storage facilities, enclosed boarding ramps, and a VIP lounge. Some international flights do come into Bluefields, Corn Island, and Puerto Cabezas as well. There are minor strips all around the country which can accommodate small crafts.