Can a Chinese billionaire build a canal across Nicaragua?

PUNTA BRITO, Nicaragua One of the largest engineering projects in history would start here, on this desolate and pristine crescent of dark-sand Pacific beach.

From in front of the hammock-swinging shrimpers on the porches of their tin-and-wood shanties, the trench would run east in sinuous curves up through the mangroves and banana fields until it reaches the shores of Central Americas largest freshwater lake, then cut across the Caribbean highlands and through indigenous territory, ending its journey 172 miles away on the beaches of the Atlantic.

They call it the Grand Inter-Oceanic Canal: an audacious $50billion plan by an obscure Chinese billionaire to cross Central America and challenge the Panama Canal for the worlds cargo traffic. And some in Nicaragua are gearing up for the fight of their lives to stop it.

For a country as poor as Nicaragua, said Roonell Carrillo, a cattle farmer who works along the proposed canal route, this is an enormous risk.

Last month, on a riser erected next to Carrillos farm, the son of President Daniel Ortega, the former Marxist guerrilla, stood alongside Wang Jing, a Chinese telecom magnate, to herald the official start of construction. In reality, little physical work is being done besides widening access roads, and major doubts remain about many aspects of the project, including whether Wang can afford to build it.

Massive canal project in Nicaragua

Wang Jing, a Chinese billionaire, plans to build a canal across Nicaragua to challenge Panama for the worlds cargo traffic. The canal would be three times as long as Panamas and able to accommodate larger ships. Opponents of the project worry what the regional impact will be if the proposed Grand Inter-Oceanic Canal is ever built.

According to interviews with Chinese media, Wang was born in 1972 in Beijing, studied traditional Chinese medicine, and worked as a school principal. Then he joined a government-affiliated telecom company that went private in 2009. His firm grew rapidly into the largest privately owned science and technology company listed on the Chinese stock market and made him one of the countrys richest men.

President Ortega granted Wangs canal company, HK Nicaragua Canal Development Investment Co. Ltd, or HKND Group, a 50-year concession, which would give Nicaragua only a small return $10million a year for the first decade of operation, then increasing percentages of the profits in subsequent years. But even Wangs Nicaraguan construction partners know little about his other investors or whether the Chinese government, which has denied involvement, is backing the project.

It would be a relief for me to know that the Chinese government was behind this rather than just an entrepreneur, said Benjamin Lanzas, head of Nicaraguas construction industry group, who has met Wang and whose company has contracts for parts of the project. For one investor, thats a lot of money.

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Can a Chinese billionaire build a canal across Nicaragua?