Chinese Tycoon Plans $40 Billion Canal Project in Nicaragua

Tuesday, 16 Jul 2013 01:27 PM

By Lisa Barron

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As China's investment in South America continues to soar, Beijing businessman Wang Jing has devised what might be the most ambitious plan yet — a massive waterway through the rivers and tropical forests of Nicaragua designed to rival the Panama Canal.

Wang Jing, the billionaire chairman of HK Nicaragua Canal Development Investment Co. (HKND), defended the project at a news conference in Beijing last month, shortly after the Sandinista-controlled Nicaraguan parliament approved it, saying, "We don't want it to become an international joke, and we don't want it to turn into an example of Chinese investment failure," reports the Washington Times.

"We are going to complete our mission to develop the economy of Nicaragua and Central America and improve the future of maritime trade between the West and East,” Wang said at the signing. "We will change the world."

Nicaraguan President Daniel Ortega signed a 50-year concession on June 14 that grants Wanng's company rights to develop a $40 billion project that includes a canal, an oil pipeline, two deep-water ports, an inter-oceanic railroad, and two airports, according to Businessweek.

The canal would be the worlds' largest civil engineering project, roughly three times as long as its Panamanian counterpart.

But experts in the U.S. have expressed doubts about its feasibility.

"The paths all go through Lake Nicaragua, which is the source of fresh drinking water for most of Nicaragua," Bob McMillan, former chairman of the Panama Canal Commission, told the Washington Times. "What if there is a damaged ship that leaks petroleum or some other kind of chemical into the lake? That would be a disaster for the drinking water."

McMillan also questioned whether Managua would be able to manage the project, saying, "Panamanians were totally ready to take over the Panama Canal's management when the transfer took place in 1999. Will Nicaragua be as ready or would more Chinese have to come to the country to ensure an effective operation of the canal — if the canal is actually built?"

But HKND is forging ahead. It has reportedly called on consultants Environmental Resources Management to conduct an environmental and social impact assessment for possible canal routes and has asked China Railway Construction to do the initial technical feasibility assessment.

"Another canal would certainly bring to fruition what has been kind of a low-level but persistent voice that Beijing has had over the last about 15 years, that they would like to have greater access to the Atlantic and be able to find an alternate route beyond Panama, where they wouldn't feel that the U.S could potentially impact on their access to either end of the canal," Cynthia Watson, professor of national security at the National War College, told the Times.

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