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[stephen at melbpc.org.au]

Nicaragua gives Chinese firm contract to build alternative to Panama 

Canal project will reinforce China's growing influence on global trade and 
weaken US dominance over a key shipping route

By Jonathan Watts and agencies, www.guardian.co.uk, Friday 7 June 2013
<http://www.guardian.co.uk/world/2013/jun/06/nicaragua-china-panama-canal>


Nicaragua has awarded a Chinese company a 100-year concession to build an 
alternative to the Panama Canal, in a step that looks set to have profound 
geopolitical ramifications.

The president of the country's national assembly, Rene Nuñez, announced the 
$40bn project, which will reinforce Beijing's growing influence on global 
trade and weaken US dominance over the key shipping route between the 
Pacific and Atlantic oceans.

The name of the company and other details have yet to be released, but the 
opposition congressman Luis Callejas said the government planned to grant a 
100-year lease to the Chinese operator.

The national assembly will debate two bills on the project, including an 
outline for an environmental impact assessment, on Friday.

Nicaragua's president, Daniel Ortega, said recently that the new channel 
would be built through the waters of Lake Nicaragua.

The new route will be a higher-capacity alternative to the 99-year-old 
Panama Canal, which is currently being widened at the cost of $5.2bn.

Last year, the Nicaraguan government noted that the new canal should be 
able to allow passage for mega-container ships with a dead weight of up to 
250,000 tonnes. This is more than double the size of the vessels that will 
be able to pass through the Panama Canal after its expansion, it said.

According to a bill submitted to congress last year, Nicaragua's canal will 
be 22 metres deep and 286 km (178 miles) long - bigger than Panama and Suez 
in all dimensions.

Under the initial plans for the project, the government was expected to be 
the majority shareholder, with construction taking 10 years and the first 
ship passing through the canal within six years. It is unclear if this is 
still the case.

Two former Colombian officials recently accused China of influencing the 
international court of justice to secure the territorial waters that 
Nicaragua needs for the project.

In an op-ed piece for the magazine Semana, Noemí Sanín, a former Colombian 
foreign secretary, and Miguel Ceballos, a former vice-minister of justice, 
said a Chinese judge had settled in Nicaragua's favour on a 13-year-old 
dispute over 75,000 square kilometres of sea.

They said this took place soon after Nicaraguan officials signed a 
memorandum of understanding last September with Wang Jing, the chairman of 
Xinwei Telecom and president of the newly established Hong Kong firm HK 
Nicaragua Canal Development Investment Company, to build and operate the 
canal.

Nicaragua has accused Colombia and Costa Rica, which has a claim on 
territory likely to be used by the new canal, of trying to prevent the 
project going ahead.

Additional reporting by Gareth Richards
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Cheers,
Stephen