Nicaragua Cancels $50 Billion Chinese Canal Project After 10 Years of No Progress

The communist regime of Nicaragua canceled on Wednesday a highly controversial $50 billion canal project led by a Chinese businessman after no construction work had been done for the past ten years. Listen To Story

The project, known as the Interoceanic Grand Canal (IGC) or the “Nicaragua Canal,” contemplated the creation of a roughly 172.7-mile-long shipping canal that would connect the Atlantic and Pacific Oceans while crossing through Lake Nicaragua, Central America’s largest lake and a crucial freshwater reservoir.

The regime of dictator Daniel Ortega called the canal “the biggest civil engineering project in history” and sought to use it to compete with the nearby Panama Canal in both size and scope. The $50 billion canal project, had it been built, would have given China’s communist government a significant foothold in Central America.

In 2013, the Ortega regime granted a renewable 50-year lease for the construction and handling of the prospective canal to the Hong Kong Nicaragua Canal Development (HKND) company, owned by Chinese businessman Wang Jing.

Nicaraguan Vice President Rosario Murillo gestures next to his husband Nicaraguan President Daniel Ortega during a rally marking the 40th Anniversary of the National Palace’s takeover by the Sandinista guerrillas prior to the triumph of the revolution, in Managua on August 22, 2018.
Nicaraguan Vice President Rosario Murillo gestures next to his husband Nicaraguan President Daniel Ortega during a rally marking the 40th Anniversary of the National Palace’s takeover by the Sandinista guerrillas prior to the triumph of the revolution, in Managua on August 22, 2018. (INTI OCON/AFP via Getty Images)

While the symbolic “groundbreaking” of the project took place in December 2014, no work was done on the canal since then. Wang lost 85 percent of his fortune less than a year after the groundbreaking ceremony. In 2021, Wang and another of his companies, Beijing Xinwei Technology Group, were expelled from the Shanghai Stock Exchange due to “bad practices.”

Under Ortega’s orders, Nicaragua’s National Assembly reformed law 800, which established the legal framework of the canal project and repealed law 840, which granted the concession granted to the HKND company.

The Sandinista lawmakers claimed in an explanatory memorandum that the purpose of the change in the canal’s laws is to “strengthen and update the national legal system” and that it is necessary to “adapt some laws to face such changes and maintain an optimal management within the State of Nicaragua.”

“Within these changes, it is necessary to adapt [The Nicaragua Grand Canal law], according to the new realities and to propitiate a better performance for the benefit of Nicaraguan families,” the memorandum reportedly read.

Nicaraguan newspaper La Prensa reported on Monday that, according to Chinese media reports, Wang, who has “disappeared” from the public eye following the loss of his fortune, is living “a happy life” in the United States.

The prospective Chinese-built canal was loudly condemned by local communities, farmers, and environmentalists since the initial announcement of the project over ten years ago. Critics of the project repeatedly warned that the construction of the canal would require the displacement of entire communities and cause irreversible environmental damage to Nicaragua.

Although local opponents have celebrated the cancellation of the project as a victory, environmental rights expert Mónica López Baltodano told the Nicaraguan outlet Confidencial that the fact that the Ortega regime has not repealed Law 800 but, rather, reformed it, means that they intend to “maintain the idea that the canal project is a project of national interest” and that Nicaragua has the power to decide on it.

Chinese State Councilor and Foreign Minister Wang Yi R meets with Nicaraguan Foreign Minister Denis Moncada in New York on Sept. 19, 2022.
Chinese State Councilor and Foreign Minister Wang Yi R meets with Nicaraguan Foreign Minister Denis Moncada in New York on Sept. 19, 2022. (Liu Jie/Xinhua via Getty Images)

López Baltodano also asserted that the Ortega regime has “enormous difficulty in recognizing the absolute failure” of the canal project, which had been hailed as “the center of its promise of economic development for the country.”

“We have to be careful that other mafia business could come around the corner and be presented again under the protection of Law 800,” she said, noting that it is evident that “the risks of expropriation and aggression to the communities” persist.

Local farm leader Francisca Ramírez affirmed to Confidencial that the fact that the law was not repealed “generates more doubts” because it is not known “to whom they are going to give this concession.”

Exile farm leader and former political prisoner Medardo Mairena claimed that experts were aware from the beginning that the canal project “was unfeasible” and the regime was using it to force “the dispossession of properties.”

“This has left us mourning and pain, because they took the lives of hundreds of indigenous peasants for defending our right to private property and the protection of natural resources,” Mairena said.

Mairena asserted that he would continue to denounce any agreement the Ortega regime signs with China or any other country because “Nicaraguans will not allow them to continue selling our homeland.”

Christian K. Caruzo is a Venezuelan writer and documents life under socialism. You can follow him on Twitter here.

Source: Breitbart

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