by the El Reportero’s wire services
With a big ”the Canal is a big fraud” headline, the opposition in Nicaragua denounced the concession to built a canal in Nicaragua to an obscure Chinese consortium.
A Nicaraguan congressional committee has approved giving a China-based consortium the concession to build and operate a canal between the Pacific and Caribbean, fast-tracking the huge development project despite objections from the opposition.
The infrastructure committee president, Jenny Martínez, said the bill had immediately been sent to the National Assembly, which is expected to approve it on Thursday. President Daniel Ortega’s Sandinista Front controls the national legislature with 63 out of 92 politicians.
Opposition politicians voted against the proposal, saying the initiative was being rushed.
For Vilma Núñez, president of Nicaraguan Center of Human Rights (CENITH), is not enough that the representatives of the opposition parties are opposed in the National Assembly, and questioned where are the bases of these political parties and the conscience created regarding the imminent dangers against the population, if the initiative is by Ortega.
“This deserves that we take the National Assembly,” said to the Nicaraguan daily La Prensa, the president of CENIDH, who believes that the population must not allow that the project be discussed on Thursday. In addition, Núñez estimated that after this project there are dark intentions on the part of the presidential family.
La Prensa denounced that he initiative of Law and Framework Agreement grants de concession of the interoceanic canal and other eight subprojects are a scam, as the opposition to the project considered, because the law disposes Nicaragua the right to build a serious project of the Interoceanic Canal, deepwater ports, railways and airports in both seas and is delivered to a company of “briefcase” called Developer of Large Works whose company shares belong to a private company established in the Grand Cayman Islands.
The Chinese company, HK Nicaragua Canal Development Investment, is working with the Nicaraguan government on the canal project, which was announced last week. Experts say it may take 11 years to finish, cost $40bn and require the digging of about 130 miles (200km) of waterway.
Canal proponents say the waterway could create 40,000 construction jobs and double the per-capita gross domestic product of Nicaragua, one of the poorest countries in Latin America. The government plans to grant the Chinese company a concession for an initial 50 years, with the possibility of doubling it.
Critics say there needs to be more information before politicians approve the construction of a canal whose location and environmental impact has not been determined.
Others have questioned the plan’s viability just a few hundred miles northwest of the Panama canal.
“Since there is no defined path, we can’t measure the degree of seriousness of this project,” the opposition member Javier Vallejos said. “This is like putting the cart before the horses,” he added, referring to the fact that legislators are approving the canal’s construction before knowing where it would be built.
Jaime Incer, an adviser to the presidency on environmental issues, agreed with Vallejos and said authorities needed to define a specific route before approving a concession.
“There are at least six proposed routes and five of them include Lake Nicaragua, but there is nothing definite, that’s all part of the unknown,” he said.
Ortega has not presented an economic feasibility study or research into the potential environmental impact of the project. Last month he said the project would start in Bluefields Bay on the southern Caribbean coast, go through the centre of the country and into Lake Nicaragua and end at the southern Pacific coast.
The deputy foreign minister, Manuel Coronel, chairman of the Grand Canal Authority, said on Monday that awarding the concession to the Chinese company guaranteed the project would be carried out. “It’s a very serious company, very responsible and recognized,” he said. “To doubt [the company] is to oppose the project for political rather than realistic issues.”
The Hong-Kong-registered HK Nicaragua Canal Development Investment has an office in the Nicaraguan capital. It has said it is willing to fully study the technological, economic, environmental and social impact of the project.
“This is a great project that has the potential to transform international trade and bring significant economic and social benefits to Nicaragua, their neighbors and Latin America,” the company spokesman, Ronald Maclean-Abaroa, said on the group’s website.
Under the deal, the Chinese company would pay Nicaragua $10m annually during the first decade, followed by a share of canal revenues that would begin at 1% and rise to an unspecified percentage over the duration of the concession.
After completing the concession, the Chinese company would have to turn over to Nicaragua all buildings and other canal infrastructure. The legislation says the government may expropriate any property or rights over property needed to develop the canal. José Aguerri, president of an association of the chambers of commerce in Nicaragua, said it was crucial for the government to specify the canal’s route. “We have told the committee that until you define the path that the canal will have, it will be difficult to attract investment to the area because there is no legal certainty,” he said after a meeting with committee members.
Aguerri said politicians also should consult civic groups and organisations working with the environment before approving the project.
Panama, which has a steady income flow from its canal, deliberated before embarking on a seven-year, $5.2bn expansion to allow bigger ships to use its waterway.
That project is scheduled to be finished next year. Nicaragua, on the other hand, has been rushing its canal’s approval despite questions being raised by critics. Supporters of the construction argued in a 2006 presentation that they could capture 4.5% of world maritime freight traffic and earn a 22% profit margin by 2025, although their cost estimates at that time were much lower than those of the current project.