MANAGUA (Reuters) – Nicaragua on Monday announced the start of work on a $50 billion shipping canal, an infrastructure project backed by China that aims to rival Panama’s waterway and revitalise the economy of the second-poorest country in the Americas.
The groundbreaking was largely symbolic, as work began on a road designed to accommodate machinery needed to build a port for the canal on the Central American country’s Pacific coast.
Nicaragua’s government says the proposed 172-mile (278-km) canal, due to be operational by around 2020, would raise annual economic growth to more than 10 per cent.
The canal could also give China a major foothold in Central America, a region long dominated by the United States, which completed the Panama Canal a century ago.
Construction of the new waterway will be run by Hong Kong-based HK Nicaragua Canal Development Investment Co Ltd (HKND Group), which is controlled by Wang Jing, a little-known Chinese telecom mogul well connected to China’s political elite.
By the end of the third quarter, excavation work would begin, with a tender for the design of the locks due by the end of the year, he said.