Work Continues on China-Backed Nicaragua Canal Amid Serious Opposition

I have written before about the “systematic dismantling of Paradise” and have used the construction of a canal – cutting a huge swathe through nature reserves, indigenous lands, people’s homes and agricultural properties in Nicaragua – as a prime example in this hemisphere. The development also threatens the country’s major source of fresh water, Lake Nicaragua, one of Central America’s largest reservoirs.

A boat on Lake Nicaragua, which the canal will pass through. Yes, that is a (not entirely dormant) volcano in the background.

As is often the case, it seems, the project is almost certainly backed by the Chinese Government, although ostensibly the vision of a 42-year-old Hong Kong-based billionaire who has denied such connections and who apparently made his fortune in the telecoms business. But as one analyst said,”Big Chinese companies just don’t parachute down into Latin America.” Oh, and this company was only formed three years ago, by the way.

And as is often the case in this part of the world, it is being undertaken without proper consultation, in the face of considerable grassroots opposition and without a trace of transparency. In fact, there are claims it is illegal.

Interestingly too, work started in December 2014 but I have not been able to find anything about an Environmental Impact Assessment. Has there been one, or is it the usual “after the fact” scenario? Because the agreement has already been signed and sealed, although no one knows any details.

But, as we are also always promised, this potentially disastrous project – an attempt to rival the Panama Canal and channel Chinese goods back and forth – this will bring hundreds, nay thousands of jobs and eradicate poverty for Nicaraguans!

Why does this photograph look oddly familiar? The official ceremony. (Photo: AFP)

Any similarities to the situation elsewhere in Latin America and the Caribbean are purely coincidental… Aren’t they?

Nicaraguan President Daniel Ortega (left) signed an agreement with Wang Jing in June 2014. Work started six months later, apparently without any Environmental Impact Assessment.

The following article appeared in the Costa Rica News. You may also read more about the project in a recent BBC report: “Wang Jing: The man behind the Nicaragua canal project.” (For some reason I am unable to post the links here – my apologies):

The Costa Rica News (TCRN) – In December 2014, work began on the Nicaragua Grand Canal, a 175-mile-long canal through Nicaragua connecting the Atlantic and Pacific oceans. The Nicaragua canal could eventually service 5 percent of the world’s cargo traffic. Advocates of the canal state the project will bring critical jobs and deliver a significant boost the economy of Nicaragua which is currently the second-poorest country in the western hemisphere. Critics argue that the environmental and social impact of the project would be catastrophic.

Ortega claims the canal would “completely eradicate poverty” in Nicaragua by 2020.

The inter-ocean canal in Nicaragua, with an estimated price tag from $50 billion to $100 billion, would cut through numerous nature and bio-reserves and require massive dredging to accommodate the major ship traffic to reach Lake Nicaragua, Central America’s largest lake. Both local and international scientists and environmentalists clearly state that the project will be an environmental disaster.

The man behind the Nicaragua Grand Canal project is Chinese businessman Wang Jing. The 42-year-old Chinese billionaire is the primary sponsor on what is arguably the world’s largest construction project. Once complete in 2020, Wang Jing envisions free-trade zones, international ports, tourist resorts and an international airport.

The Nicaraguan canal will be more than three times as long as the Panama Canal. It will also be much wider and deeper to fit the next generation of vast container ships.

The planned canal will cut right through Lake Nicaragua, the country’s main source of fresh water. It will be more than three times longer than the Panama Canal.

Controversy Surrounding the Nicaragua Grand Canal Project

The canal project faces extensive opposition within Nicaragua. Political opponents of Ortega state the government has violated the most basic democratic principles and undermines Nicaraguans’ sovereign rights by making the deal with little to no disclosure. Protests against the canal began shortly after the official ceremony that marked the start of the project’s construction.

Internally in Nicaragua, 21 civil society groups and political parties merged to issue a statement in December 2014 rejecting the project and calling for a halt to work on the grounds that the concession awarded to Hong Kong Nicaragua Canal Development (HKND) was illegal.

International Opposition to the Nicaragua Canal Project

Prior to the commencement of work on the canal in October 2014, the Association for Tropical Biology and Conservation (ATBC) urged the government of Nicaragua to suspend any and all activities on the construction of the Canal until independent studies on environmental impact could be completed. The ATBC is the world’s largest scientific organization devoted to the study, protection and sustainable use of tropical ecosystems.

The preliminary study of the ATBC revealed that the Canal project will have serious negative impact on approximately 6.5 million square kilometers of forest, coastal wetlands systems.

The Panama Canal Authority claims that industry conditions do not exist for having two inter-oceanic canals in Central America. A spokesperson for the administrator of the Panama Canal said: “There is no demand to justify another canal across the Central American isthmus because there is not enough demand to share between two”. It is estimated that the Nicaragua Canal if completed, could reduce ship transits through the Panama Canal up to 30% and could potentially capture 5% of global maritime trade.

Meanwhile the Panama Canal authorities are continuing their work on a $5.25 billion expansion project and are also investigating the possibility of an additional $17 billion expansion to allow even larger ships to passage through the canal further reducing any competitive edge the Nicaragua project might pose.

Costa Rica’s Ministry of Foreign Affairs has stated that a lack of transparency in the canal project threatens Nicaragua’s indigenous land rights and that the mega project could displace tens of thousands of people from their lands as well as affecting their traditional ways of life.

There has been was no noticeable response from the Obama administration on the Nicaragua canal.

The Costa Rica News (TCRN)
San Jose, Costa Rica

Many civil society groups and indigenous people are deeply unhappy and opposed to the Canal. Environmentalists say it will be an ecological disaster. (Photo: AFP)