In January, Nicaraguan president Daniel Ortega announced that construction would begin later this year on a controversial $40 billion, 180-mile long waterway through the middle of his country that would rival the Panama Canal. The Pacific entrance of the Nicaragua Canal would be cut very near the heart of Nicaragua’s surf zone, just south of Playa Colorado, and north of the beachbreaks of San Juan del Sur. It’s safe to say that the surf spots surrounding the mouth of the canal would be impacted dramatically. Though plans had been in the works for well over a year, few took them seriously until Ortega’s announcement.
For nearly 200 years, developers have floated plans to build a canal through Nicaragua that would link the Pacific to the Caribbean. U.S. government interests made at least three separate attempts to finalize a Nicaraguan canal project in the 19th Century before they finally abandoned Nicaragua for Panama in 1904. Plans were shelved for a time, but in the 1980s Asian investors once again began sniffing around the idea of a Nicaraguan answer to the Panama Canal. In 2013 President Ortega signed a concession with a Hong Kong-based company, HKND, that granted the company exclusive rights to finance and build a canal. That same year the Nicaraguan congress passed legislation approving the agreement, which also granted HKND what amounted to 50-year control of the proposed canal and any related projects.
Advocates for the plan claim that as many as one million jobs will be created, a much needed economic boost to one of the poorest countries in the western hemisphere. Environmentalists, however, are outraged that the plans are shrouded in secrecy, and that no steps seem to have been taken to preserve sensitive ecosystems that would be devastated by the construction. The president of the Nicaraguan Academy of Sciences recently published a paper in the journal Nature pointing out that the canal, as proposed, would threaten Lake Nicaragua, the nation’s largest freshwater drinking supply, bisect two nature reserves, destroy nearly 1 million acres of rainforest, obliterate coral reef and mangrove systems on both the Caribbean and the Pacific sides of the country, and possibly displace at least five indigenous communities in the area.
HKND is also under scrutiny, as they’ve no record of serious infrastructure development, and a spotty track record of following through on large-scale international development projects. That could mean either that the project goes nowhere, as have Nicaraguan canal plans in the past—though this one has come closer than most to bearing fruit. Or that the company proceeds anyway with little idea of how to feasibly manage such a massive undertaking. The country waits.
Read more about Nicaragua in The Coveted Coast, a feature in our March Issue about the country’s tourism boom amid its development and foreign interests.