Nicaragua Canal News: Project Faces Environmental, Financial Challenges
Construction of Nicaragua's proposed transoceanic canal will not begin until at least March, as the $50 billion project's financial and environmental footing is coming under increasing scrutiny.
The consulting firm charged with performing the canal's environmental impact assessment listed several issues in need of investigation before construction can proceed, the Los Angeles Times reported. Britain-based ERM said concerns include seismic risks to the locks and whether there is sufficient water to fill the 175-mile canal.
The 170-mile canal would cross Nicaragua from the Pacific Ocean to the Caribbean Sea and provide an alternative route to the century-old Panama Canal. But ever since it was announced in 2012, its construction has been opposed by many indigenous communities on the eastern side of the proposed route, according to the newspaper.
Paul Oquist, the executive director of the Nicaragua Grand Canal Commission, told the Council of the Americas in Washington last week that the Central American country's government was taking concerns about the project's impact seriously.
"We and (Nicaraguan President Daniel Ortega) have made the decision that all studies recommended by the environmental groups have to be undertaken," Oquist assured.
The canal would be built by the Chinese company HKND, which in 2013 was given a 50-year renewable permit to build and operate the waterway, the Los Angeles Times said. But Wang Jing, the billionaire businessman behind the firm, recently lost 85 percent of his fortune in the stock market, a development that has cast fresh doubts on the canal project, the Guardian reported.
The 42-year-old had ranked among the world's 200 richest people until June, when his net worth dropped from some $10 billion to just over $1 billion, according to the British newspaper.
Analysts say that massive drop could well affect the financial strength of HKND. "Wang's financial resources will impact how and whether the canal can and will be built," Daniel Wagner, the head of the Country Risk Solutions consultancy, told Bloomberg.
But Bill Wild, HKND's chief project adviser for the canal, insisted that he had "no doubt that appropriate financial arrangements will be in place before construction commences," the Guardian noted.
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