[120613.EN.SEA] China-Hong Kong Firm To Start Rival Panama Canal Through Nicaragua

NICARAGUA has announced that it has granted a Chinese firm a 100-year lease to build a US$40 billion rival to the Panama Canal, London's Guardian newspaper reported.

Nicaraguan officials signed a memorandum of understanding last September with Xinwei Telecom chairman Wang Jing, and president of the new Hong Kong firm HK Nicaragua Canal Development Investment Company, to build and operate the canal.

The new canal is set to have a higher capacity than the Panama Canal, even after its US$5.2 billion expansion to be completed in 2015. The move by Nicaragua highlights growing Chinese influence over the global economy as US dominance weakens.

While the name of the Chinese operator has not been released, Nicaragua's president, Daniel Ortega, has said that the new channel will run through Lake Nicaragua in the northern part of the country.

The new canal is expected to transit 18,000-TEU plus ships, able to accommodate vessels double the size able to transit the expanded Panama Canal, which when complete will be able to handle 13,000-TEUers, of a stubbier, broad beam design.

According to a bill submitted to the Nicaraguan congress last year, the projected canal will be 22 metres deep and run 286 kilometres longer than Panama's and the lock-less Suez Canal.

But two former Colombian officials recently accused China of influencing the International Court of Justice to secure the territorial waters that Nicaragua needs for the project.

Former Colombian foreign minister Noemi Sanin and Miguel Ceballos, former vice justice minister, claim a Chinese judge settled the 13-year-old dispute in Nicaragua's favour over 75,000 square kilometres of sea.

Source : HKSG, 11.06.13.