Assembly Approves Massive Nicaragua Canal Project

A multi-billion dollar proposal to plow a massive rival to the Panama Canal across the middle of Nicaragua was approved by the leftist-controlled National Assembly Thursday, capping a lightning-fast approval process that has provoked deep skepticism among shipping experts and concern among environmentalists.

The assembly dominated by President Daniel Ortega’s Sandinista Front voted to grant a 50-year concession to plan and build the canal —with an option for another 50 — to a Hong Kong-based company whose only previous experience appears to be in telecommunications.

The legislation approved Thursday by a 61-28 vote contains no specific route for a canal and virtually no details of its financing or economic viability. It grants the Hong Kong company exclusive rights to plan and build the canal in exchange for Nicaragua receiving a minority share of any eventual profits.

Ortega’s backers say the Chinese will transform one of the region’s poorest countries by turning a centuries-old dream of a Nicaraguan trans-ocean canal into reality, bringing tens of thousands of jobs to the country and fueling an economic boom that would mimic the canal-driven prosperity of nearby Panama.

The currently estimated cost is $40 billion.

“One of Nicaragua’s great riches is its geographic position, that’s why this idea has always been around,” Sandinista congressman Jacinto Suarez said during the legislative debate Thursday. “Global trade demands that this canal is built because it’s necessary. The data shows that maritime transport is constantly growing and that makes this feasible. Opposing it is unpatriotic.”

While the Hong Kong company has said almost nothing about the canal’s route, it would certainly cross Lake Nicaragua, the country’s primary source of fresh water. If one of the world’s largest infrastructure projects ever is actually built, the water used by the canal’s locks could seriously deplete the lake, environmentalists say.

Global engineering and shipping experts say those concerns are real, but lowered demand for massive container shipping and increasing competition from potential routes, including the warming Arctic, may mean that the Nicaraguan canal will simply prove economically unfeasible, adding to a long list of unrealized visions of moving riches from sea to sea across the country.

Either way, the quick march of the canal project through the National Assembly has set off a backlash from environmental and other activists, who held a series of marches this week to protest the granting of rights to the HK Nicaragua Canal Development Investment Co., without any open bidding process or details of its financing.

Courtesy of USA Today: To read the rest of the article visit www.usatoday.com

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