Nicaraguan Canal Construction Delayed

By Mark Edward Nero

The developer hired by the Nicaraguan government to build an alternative to the Panama Canal, Hong Kong-based infrastructure development firm HKND Group, says it needs another year before it can begin constructing the $50 billion project.

The developer, which originally was to begin construction by late 2015, recently said that it needs more time to “fine-tune” the project, the International Business Times reported in late November. HKND was granted the exclusive right to build the canal in 2013.

As the name implies, the Nicaragua Canal is a proposed waterway through Nicaragua to connect the Pacific Ocean with Caribbean Sea and Atlantic Ocean. The 130-mile waterway is expected to take up to 11 years to complete.

It was in June 2013 that the Nicaraguan legislature approved an exclusive commercial agreement with HKND to advance the Nicaragua Canal and Development Project.

The canal is designed to accommodate container vessels up to 25,000 TEUs, super tankers of 320,000 deadweight tons and bulk carriers of 400,000 dwt. The planned project includes the construction of two ports, a free-trade zone and an international airport.

Growth in East-West trade and ship sizes could eventually lead to $1.4 trillion in total goods value transiting the combined Nicaragua and Panama canals, HKND says its own commercial analysis has found.

Nicaragua Breaks Ground on Panama Canal Rival

By Mark Edward Nero

The Central American country Nicaragua broke ground Dec. 22 on a new Chinese-backed shipping canal that aims to rival the Panama Canal. The $50 billion, 172-mile canal could be operational by the year 2020, according to the Nicaraguan government.

The Nicaragua Canal aims to connect the Caribbean Sea, and therefore the Atlantic Ocean, with the Pacific Ocean. The proposed route starts from the mouth of the Brito river on the Pacific Ocean side, passes through Lake Nicaragua, and ends in the Punta Gorda river on the Caribbean.

The proposed canal would be up to 1,706 feet wide and 90 feet deep. By contrast, the 48 mile-long Panama Canal is 110 feet wide, and 41.2 feet in depth.

Construction of the new waterway is to be run by Hong Kong-based HK Nicaragua Canal Development Investment Co., commonly known as HKND Group; the company is run by Chinese telecom mogul Wang Jing.

“This moment will surely go down in history. I announce the start of work on the great canal of Nicaragua,” Wang Jing said during a Dec. 22 groundbreaking event, which was held on Nicaragua’s Pacific coast.

Despite the groundbreaking and the start of work on Dec. 29, excavation work isn’t scheduled to begin until the second half of 2015.

Although a Chinese company is managing the project, Nicaraguan officials have maintained that the Chinese government itself isn’t behind the project and that the canal is expected to receive international funding.

“The Chinese haven’t arrived in Nicaragua with occupying troops,” Nicaragua President Daniel Oretga said regarding the canal in a speech in late December.