The Nicaraguan government and a newly formed company run by a Chinese telecom mogul have signed a memorandum of understanding that commits Hong Kong-based HK Nicaragua Canal Development Investment Co. Ltd. to financing and building the “Great Canal of Nicaragua,” according to a statement released Monday night by investment-promotion group ProNicaragua.
The memorandum stipulates that Nicaragua’s canal will have two components: a traditional waterway for ships and a “dry canal” railroad for freight. Both canals will link deep water ports on the Caribbean and Pacific coasts. Nicaragua has estimated the cost of the canal project at $30 billion.
The Chairman: Chinese telecom mogul Wang Jing is the new president of HK Nicaragua Canal Development Investment Co. Ltd (bio photo from Xinwei)
In addition to financing and building the canals, the memorandum says HK Nicaragua Canal Development Investment will also build a deep-water port at Monkey Point, on the southern Caribbean coast. The agreement also commits the Chinese company to completely remodeling Nicaragua’s Puerto Corinto on the Pacific coast.
While the Chinese company will be charged with managing the construction and financing of the projects, Nicaragua will remain the majority stakeholder with 51% ownership. The structure of Nicaragua’s ownership is still not clear, however.
It’s also unclear what type of canal-building experience the Chinese company running the project has. Nicaragua Canal Development Investment is headed by Wang Jing, the president of Xinwei Telecom Enterprise Group, a Chinese telecom company that specializes in wireless communication technologies, products and services.
But what the Chinese business tycoon may lack in canal-building experience, he apparently makes up for in enthusiasm and vision.
On Xinwei’s website, in a message from the company president titled the “Chairman’s speech,” Wang says his wireless company is dedicated to the “progress of the world civilization.”
“We are confident that we will succeed,” he says, referring to his telecom company’s plans for expansion. “Xinwei is creating history! Xinwei will become a legend!”
If his new canal company can finally fulfill Nicaragua’s centuries’ old canal dreams, Wang will definitely create history and become legend.
funny how in june the price tag was $18 billion. my how the price of dreams escalates!
Did you mention, and if not, you should, that the real owners of wide parts of the land, where they are planning ports, channel, railway tracks etc. just started a lawsuit against D. Ortega and René Núñez. Because the law about the Big Cauce is violating the autonomy laws and ancestral rghts and demarcated land ownership of the Rama people.
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Like Hitler’s new “Wechsel” currency, which made Germany in just 4 years a threat to the British empire, Nicaragua could also consider introducing
it’ s own Government issued bonds as collateral to finance the infrastructure project. Wages paid to canal workers are debt and intetrest free. The workers can pay for things with them. Shopkeepers can pay their taxes with thema nd central government will redeem them. the currency is backed not by gold or fiat paper money, but the labour of the workforce building the canals. Once the canal has been financed for half price, as there is no interest payments, revenue will flow from the canal and railway. Shipping companies can also redeem the Wechsel or in Spanish “Cambio” bonds against future canal transit costs. If we exclude the bankers interest costs and compound interest on outstanding debt, the canal will cost half price.
But who would buy those bonds? What would the yield have to be? Anyway, is this Xinwei canal project for Nicaragua real, or is it just some publicity the telecom company put out so they could win a cell phone contract in Nicaragua?
[...] factor that, though not argued in court, influenced the shocking and unexpected ruling. Nicaragua signed a memorandum of understanding with China to build the canal in September 2012, just two months before the court’s ruling. The agreement [...]
In the last six decades plus that I have been around, there has hardly been a year when there have not been some sort of discussion about a canal through Nicaragua. I don’t know why it would be any different now. But, it’s the country’s political “El Dorado” which keeps the Nicaraguan people’s hopes alive. dreaming that someday Nicaragua will finally get past the multitude of social, economic, political, etc. problems that keep it from achieving its full potential. Unfortunately, I see little that would make me think the canal is finally going to materialize. For starts, the country’s lack of skilled labor, history of political turmoil, social inequalities, poverty and lack of any significant relevant infrastructure in support of such an enterprise makes me wonder how will a project of such magnitude ever be completed, let alone subsequently managed?