£24bn rival to Panama Canal to break ground this year
170-mile shipping route through Nicaragua will start in December, country's President Ortega announces
The backers of a new Central American mega-waterway to rival the Panama Canal have insisted the $40bn (£24bn) project will begin this year.
The 170-mile shipping route from the Pacific Ocean to the Caribbean, traversing Nicaragua, is expected to take five years to complete, with ground scheduled to be broken in December.
Its construction is essential to deal with a surge in global trade and the rise of colossal supertankers, many of which are too large for the ageing Panama Canal, more than 500 miles to the south.
The project’s funding is being led by the Chinese telecoms billionaire Wang Jing, whose HKND Group won a licence for the development last year.
In a statement, Mr Wang and the Nicaraguan President Daniel Ortega said: “The Nicaraguan government and HKND Group are pleased to confirm that canal construction work will begin as planned in December 2014.”
It followed suggestions from Nicaragua’s canal chief that it would be delayed until 2015.
The development will be one of Central America’s biggest-ever investments and is expected to break Panama’s monopoly on shipping through Central America.
The Panama Canal, which celebrates its centenary this year, has struggled to keep up with the increase in global shipping as more goods are exported from Asia to Europe and the US east coast.
The canal is planning its own extension, although this has been repeatedly delayed. Last week, it refused to make a $1bn payment to the Spanish building consortium expanding the waterway.
The Nicaraguan canal would be more than three times as long as the Panama Canal’s 50 miles, and the project also includes an oil pipeline, a railroad and two airports.
It would also traverse the enormous Lake Nicaragua, and environmental concerns about the freshwater expanse have raised questions about the project.
Mr Wang told The Telegraph last year that protecting the area was a key priority. “I take all responsibility for any environmental damage. I have told my employees that if we make a mistake on this front, we will be dishonoured in the history textbooks of Nicaragua,” he said, also insisting that the project will be completed in 2019.