Nicaragua Canal on Schedule to Break Ground

Nicaragua Canal on Schedule to Break Ground

Commercial News » Latin America Commercial News Edition | By Francys Vallecillo | January 14, 2014 9:40 AM ET

The $40 billion Nicaragua canal project is on schedule to break ground this year, despite rumors of a delay.

Construction for the 170-mile canal, an anticipated rival to the Panama canal, is expected to begin in December and take five years to complete.

"The Nicaraguan government and HKND Group are pleased to confirm that canal construction work will begin as planned in December 2014," Chinese entrepreneur Wang Jing and Nicaraguan President Daniel Ortega said in a statement.

The statement comes after Nicaragua's Canal Authority chief Manuel Coronel Kautz was quoted as saying work for the Nicaraguan canal would not begin until 2015. 

The Chinese consortium HK Nicaragua Development, led by Wang, won the license to develop the canal last summer, amid concerns from critics.

President Ortega has shown enthusiasm for the project since its announcement, focusing on the proposition that the canal would capture 4.5 percent of world maritime freight traffic and double the country's per-capita gross domestic product.

Last July Mr. Wang announced the canal's route, saying it would start at the port of Brito in the Pacific, cross Lake Nicaragua, pass the small airport at Morrito and work its way to Bluefields.

The mega-waterway is expected to challenge the trade monopoly held by Panama, as global trade increases and container ships grow in size.

Critics for the Nicaragua canal project raise feasibility questions, as well as concerns of potential environment damage to the country. However, Mr. Wang previously acknowledged the importance of environmental protection. 

"It is very clear to us that Lake Nicaragua is the mother lake of the country, a symbol like the Yellow River is to China. So protecting this lake is the focus of our feasibility report," he told The Telegraph. "I take all responsibility for any environmental damage. I have told my employees that if we make a mistake on this front, we will be dishonored in the history textbooks of Nicaragua." 

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