19 June 2013
The Nicaraguan government has voted to grant a concession to a Chinese company to build a rival to the Panama canal despite local opposition.
On 13 June Nicaragua’s legislature gave fast-track approval to a law that paves the way for the start next year on construction of the 250km, $40bn canal that will traverse the Central American country and link the Atlantic and Pacific oceans.
A 100-year operating concession will go to the Hong Kong-based Chinese company HK Nicaragua Canal Development Investment Co. Ltd. (HKND Group).
The company, led by Wang Jing, head of one of China’s biggest telecom firms Xinwei, and registered only in August 2012 was selected by the government of leftwing President Daniel Ortega.
Construction of the canal is slated to begin in May 2014, and is expected to take 10 years.
Environmentalists have expressed concern that the canal route would cross Lake Nicaragua. (Zach Klein/Wikimedia)
In the Nicaraguan legislature the law was approved by 61 votes with 25 against and one abstention.
Eduardo Montealegre, head of the opposition legislators, told the Inter Press Service news agency (IPS) that President Ortega and his officials were "selling out the country" with the broad concessions granted to foreign investors that, he said, hurt Nicaragua’s current and future interests.
Environmentalists have expressed concern that the canal route would cross Lake Nicaragua.
But project supporters have said the canal would dramatically boost Nicaragua’s economy.
According to IPS, it will have the capacity to handle ships that are 400m and 59m wide, while the Panama Canal, completed in 1914, can handle vessels 260m long and 32m wide – although an expansion project there is now underway.
The Guardian newspaper reports that earlier this year HKND Group signed an agreement with the state-owned China Railway Construction Company to build the new canal.