Chinese Billionaire Claims
Following the Nicaraguan Congress' lopsided decision to grant a 50-year year concession to Wang Jing to build a $40 billion canal through the Central American nation, Jing has announced that he believes he has sufficient investors to make the 150 year old plan a reality. Wang Jing appeared at a press briefing on Tuesday in Beijing.
“To realize this dream there have to be a lot of conditions met, and today the conditions are at their most mature, including mankind’s need for seaborne commerce,” Wang said in an interview following the event. “Country to country and industry to industry interactions have been transformed.”
Ambitious Plan Does Not Seem to Address Important Hurdles
Wang Jing failed to name individual investors to the press in his interview. The plan faces obvious hurdles including political, geographic, and environmental concerns.
Prior to turning to telecommunications, the Chinese billionaire made his fortune mining precious metals and gemstones in Cambodia.
Wang feels that construction could begin as soon as late 2014 and be finished in six-years time.
The 286-kilometer (178-mile) canal will cut through river valleys in the eastern part of the country and pass through Lake Nicaragua, according to a promotional video shown to journalists at a luxury Beijing hotel Tuesday. It will be dug to a depth of 27.6 meters (91 feet), have a width of 520 meters and accommodate ships displacing as much as 400,000 tons, according to the video.
Lack of Diplomatic Relations Could Be a Hurdle
Among one of many concerns facing construction is the fact that the Chinese government and Nicaragua do not have diplomatic relations. Nicaragua recognizes Taiwan and could prove a large hurdle or simply a reversal of Nicaraguan policy regarding the island nation.
Though Wang says he is "very optimistic" regarding the project others are considerably less sure. “The concession was given to what is basically an unknown company,” said Esteban Polidura, a Latin America analyst at Deutsche Bank AG (ETR:DBK) (FRA:DBK) (NYSE:DB) in Mexico City. “Given what we have seen thus far, the probability of this project becoming a reality, in my opinion, is very low.”
Others are expressing doubts regarding Nicaragua's sovereignty.
“We have to do a referendum like they did in Panama, like any democratic government would do,” said former presidential candidate Fabio Gadea, “No one knows anything about this enormous megaproject that threatens our sovereignty and environment.”
The concession that was granted early this month comes as the Panama Canal is undergoing a nearly $6 billion dollar expansion and a proposed railway in Honduras built jointly with the Chinese that would connect its Pacific and Atlantic coasts.