Description and Details

In June 2013, the Nicaraguan gov­ern­ment and Chi­nese busi­ness­man Wang Jing agreed on a bill to build the Nicaragua Grand Canal. The project will be under­tak­en by Wang Jing’s com­pa­ny, HK Nicaragua Canal Devel­op­ment Invest­ment Com­pa­ny (HKND), and it will take 50 years to finance and man­age the canal. Once announced, the project received oppo­si­tion from res­i­dents and envi­ron­men­tal­ists globally.

In design, the Nicaragua Canal will be three times as long and twice as deep as the Pana­ma Canal, cross­ing through Lake Nicaragua, the largest fresh­wa­ter body in Cen­tral Amer­i­ca. It will accom­mo­date super-sized con­tain­er­ships which are not sup­port­ed by the Pana­ma Canal. The Nicaragua Canal is esti­mat­ed to cre­ate 250,000 jobs, with half com­ing from abroad and most­ly from Chi­na. Nicaragua’s lead­ers claim the project will dou­ble the GDP of the coun­try, and could suc­cess­ful­ly lift the coun­try out of pover­ty. Some points to con­sid­er for the project include who the bene­fac­tors are of the canal’s con­struc­tion, and if it is even ben­e­fi­cial to build the canal in Nicaragua.

Details sur­round­ing the project have been secre­tive, but HKND has claimed they will invest $50 bil­lion and fin­ish the canal with­in five years. Nev­er­the­less, how HKND will finance the project remains unknown, and the com­pa­ny has lim­it­ed expe­ri­ence with canal con­struc­tion. Addi­tion­al­ly, no envi­ron­men­tal impact assess­ment has been per­formed, and the pub­lic is unin­formed of the con­struc­tion plan details.

Sim­i­lar to Pana­ma, the cli­mate in Nicaragua is humid, with rain year-round. Since the canal route will be longer than Panama’s, more dirt will be dug and trans­port­ed, lead­ing to increased envi­ron­men­tal impacts. HKND says it needs “more than 2,000 pieces of major con­struc­tion equip­ment, four bil­lion liters of diesel fuel, one bil­lion liters of bunker fuel for the dredgers, 400,000 tons of explo­sives, and untold mil­lions of tons of cement and steel”. These are just the equip­ment costs, not account­ing for human labor costs and oth­er factors. 

Before con­struc­tion, at least nine indige­nous and Afro-Nicaraguan com­mu­ni­ties need to be relo­cat­ed. This could lead to the extinc­tion of some eth­nic­i­ties, includ­ing their ances­tral lan­guage. This could be seen as an unex­pect­ed con­se­quence as relo­ca­tion is often thought of as only mov­ing the loca­tion of a home. Nev­er­the­less, for some eth­nic groups, the liv­ing envi­ron­ment is also part of their cul­ture. Los­ing their liv­ing envi­ron­ment is going to ruin their cul­ture as well. In this sense, Nicaragua Canal can lift peo­ple out of pover­ty at the price of their culture. 

The vul­ner­a­ble ecosys­tem in Nicaragua is threat­ened as well. For the water sys­tem, non-native marine species may invade Lake Nicaragua, and Nicaragua’s cich­lid fish will be great­ly affect­ed. On land, there will be exten­sive land loss due to soil removal, and the local wildlife will be con­fined to the sep­a­ra­tion of land mass­es cre­at­ed by the canal’s struc­ture. This means activ­i­ties includ­ing migra­tion, repro­duc­tion, and hunt­ing may be hindered.

Addi­tion­al­ly, salt­wa­ter intru­sion from the canal may inhib­it the fresh­wa­ter of the lake, which could lim­it fresh­wa­ter sup­plies for drink­ing water and agri­cul­tur­al prac­tices. While the canal will bring prof­its to the com­mu­ni­ty by charg­ing the car­go that pass­es through, some may argue that the prof­it gained may not be worth the loss of such an essen­tial water supply. 

A sim­i­lar prob­lem with Bama­pu­tra Dam, once built, no one can pre­dict the life­time of the canal in ser­vice. Two vol­ca­noes sit in Lake Nicaragua, one of which is active. Along with the rel­a­tive­ly large earth­quake pos­si­bil­i­ty, the canal may like­ly suf­fer from a nat­ur­al cat­a­stro­phe in the years to come. The recent nat­ur­al dis­as­ters in Turkey and indus­tri­al dis­as­ters in Ohio could prompt some to recon­sid­er the pos­si­bil­i­ties of the canal fail­ing and the poten­tial irre­versible outcomes.

Since this is an inter­na­tion­al invest­ment, the Nicaragua Canal unavoid­ably leads to polit­i­cal ten­sions, espe­cial­ly between the U.S. and Chi­na. Nicaragua Canal’s com­peti­tor, the Pana­ma Canal, was built by the U.S. at a large cost. While Pana­ma now has con­trol over the canal, it’s still under the influ­ence of the U.S. On the oth­er hand, HKND is a Chi­nese com­pa­ny aim­ing to build the Pana­ma Canal’s com­peti­tor. Although the Chi­nese gov­ern­ment denies its involve­ment in this project, there is a chance that Chi­na will take over the canal in the future if there’s an eco­nom­ic or mil­i­tary need. Hence, the U.S. is opposed to the Nicaragua Canal.

One might con­sid­er if the world needs the Nicaragua Canal. With the Pana­ma Canal’s expan­sion com­plet­ed in 2016, it has dou­bled its capac­i­ty but does not allow ves­sels with more than 18,000 con­tain­ers to pass. How­ev­er, only 10% of world trade uses ves­sels unable to pass, and not all of them take Pana­ma’s route. Due to the con­struc­tion cost, the pass­ing fee of the Nicaragua Canal for the first few years is like­ly to be more expen­sive than Pana­ma, mak­ing it less com­pet­i­tive. Due to the fac­tors out­lined above, the project was sus­pend­ed in 2018, and the ini­tial investor, Wang Jing, declared bank­rupt­cy and lost 80 per­cent of his $10 bil­lion fortune.

CEE sub­jects: Geot­ech­ni­cal Engi­neer­ing, Hydraulics and Hydro­log­i­cal Engi­neer­ing, Envi­ron­men­tal Flu­id Dynamics

Discussion Questions

  • Should the Nicaragua Canal be built? What fac­tors are you con­sid­er­ing in your response, and how might your bias impact your decision?
  • This is a plan sup­port­ed by the gov­ern­ment, but opposed strong­ly by the res­i­dents. How­ev­er, the gov­ern­ment claimed that it was for the eco­nom­ic ben­e­fit of the locals. What do you think of the divi­sion between these two opinions?
  •  If the canal were to be built, what changes would you con­sid­er to make its con­struc­tion more equi­table and to lim­it the impacts on the sur­round­ing environment?

References

Post Views: 127