The collapse of a luxury project for an undersea canal to be built in Nicaragua by an obscure Chinese investor

This week, the Nicaraguan government buried a proposed maritime canal project with the private Chinese firm Hong Kong Nicaragua Canal Development Co. Limited.HKND Group), and it was billed as “the world's greatest engineering work of all time” at the time.

Nicaragua's National Assembly on Wednesday repealed a law extending a 50-year concession for the construction and management of Nicaragua's Grand Canal to the HKND Group, owned by a Chinese businessman. Wang Jing.

At the same time, members of parliament created Law 800, the Law on the Legal Regime of the Grand Indooceanic Canal of Nicaragua and the Authority of the Grand Interoceanic Canal of Nicaragua.

Both the reform and repeal were approved by 91 representatives of Nicaragua's National Assembly, at the request of Nicaragua's dictator in an “emergency process.” Daniel Ortega.

“Within these changes, according to the new facts, Law 800 of the legal regime of the Grand Indooceanic Canal of Nicaragua and it is necessary to create the authority of the Grand Canal of Nicaragua and promote better performance for the benefit of Nicaraguan families,” Ortega justified in his reform plan.

“The Ortega Murillo regime recognizes the failure of the dream that Wang Jing wanted to sell through the Mediterranean Canal to Nicaraguans and to the whole world, by revoking Law 840 it has taken away the concession for 100 years,” responded opponent Juan Sebastian. Chamorro.

“What happened was the removal of the concession for Wang Jing, but with Law 800 the seizure and concessions to third parties are possible,” explains Chamorro, an economist by profession.

Officially named “Grand Interoceanic Canal of Nicaragua” It was intended to connect the Caribbean Sea in the Atlantic Ocean with the Pacific Ocean through a 278-kilometer-long canal that would reach Lake Gocipolca, or the Great Lake of Nicaragua, and cross the Isthmus of Rivas to the Pacific.

On June 13, 2013, the Nicaraguan Parliament passed a referendum with 61 votes in favor, 25 against, two abstentions and one abstention.

The group was headed by Chinese billionaire Wang Jing, 41 years old and on the list of the world's 200 richest people, with a net worth of $10.2 billion, according to the Billionaires Index. From Bloomberg.

However, in 2015, Wang's fortune fell 84 percent after Beijing Xinwei Telecom Technology Group collapsed along with China's stock markets. Wang Jing owned 35 percent of the company and his fall was the worst on record in 2015, which ranks the world's 400 richest people daily.

A few days ago, the Nicaraguan newspaper Pres reported Xinwei Group According to Chinese media reports, it was declared bankrupt and its listing on the Shanghai Stock Exchange was suspended due to “irregular financial movements”, which would have caused an estimated $31 billion in corruption.

“Behind the bankruptcy of Xinwei Group, the current controller Wang Jing can be said to be the most mysterious rich man in Chinese business history. No one knows his true origin, education and professional experience,” reported Sina Finance, a media outlet owned by China's famous telecommunications company Sina Corporation.

“Wang Jing's scams included the alleged excavation of gold mines, the promise of an inter-oceanic canal, and the launching of satellites. None of this happened, instead, he defrauded many governments and 150,000 shareholders of his companies, making billions in deceptive profits. And he disappeared,” Nicaraguan media said, “Wang Jing, the disgraced fraudster, now lives in the United States.”

The numbers presented by the canal project are impressive. The canal will be three times the size of the Panama Canal, a $50 billion investment, it will provide 50,000 jobs and it will double the country's gross domestic product (GDP) in five years of construction.

The project intends to start construction by the end of 2014 and the canal will be operational in 2020. The Ortega regime said the canal would end poverty and unemployment in Nicaragua.

Paul Oquist, Nicaragua's then Minister of Public Policy, said in June 2013 that the canal would boost Nicaragua's gross domestic product (GDP) growth by 15% by 2015 and increase formal employment by 623,458 people. It was 1.9 million in 2013 when the canal was built.

On December 22, 2014, construction of the canal began in an elaborate ceremony where construction machinery was brought in from some municipalities in the country.

“This land under our feet will remain in history, and this land, together with our work, will lead to a stronger country and a happier people. Together with Nicaraguan, Chinese and international companies, this land and canal will be remembered as an unforgettable story,” said businessman Wang Jing in his opening speech.

However, the construction did not start.

On the very first day, there was strong opposition to the canal project. Farmers, the owners of land to be expropriated to build the canal, organized themselves into an organization called the Peasant Movement and were decisive in the civil uprising faced by Daniel Ortega in 2018, calling for hundreds of protest marches. .

Handing over the country's sovereignty to the HKND for 100 years puts Central America's largest water reserve, Lake Nicaragua, at risk, and brings little benefit to the country, as the canal opposition argued. The concessionaire, which had no obligation to use national construction companies or local labor or to pay taxes in any way, could acquire the necessary government lands at no cost, and private lands at less than their true value.

By June 2023, Daniel Ortega recognized the stagnation of his canal project and blamed it on “North American imperialism”.

“While we were talking in Nicaragua and working on the development of the canal, there was immediately a campaign by forces like the enemies of the revolution, the North American government, to try to stop this project from moving forward,” he said. Ortega complained when he received the Iranian president in Managua Ibrahim Raisi.

According to the Nicaraguan dictator, the United States wants to maintain control over Nicaragua “so that no other country can build a canal” at a time when the neighboring Panama Canal is inadequate for current naval traffic.

“At some point a canal in Nicaragua will be a reality. Because? Because it is true that there is a canal through Panama, it has been expanded, but the demands of international traffic are very high, a canal through Nicaragua is needed, but a canal through Nicaragua (necessary) for the people, for peace, for the peace of our country. For more growth of the economy,” Ortega said a year ago, in September 2022.

Juan Sebastián Chamorro said the withdrawal of the canal concession to controversial businessman Wang Jing “should not be a cause for celebration because Ortega left the Grand Canal Commission alive” whose functions constitute the Grand Canal of Nicaragua Company, which “will manage not only the feasibility studies, but also the construction and operation of the maritime canal.”

“Why is Ortega doing it now?” asks the opponent. “Mostly because he already has someone to get another piece (of booty),” he reckons, in what appears to be the next chapter in this story.