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Is the Gran Canal really a ‘big Christmas present’ for Nicaraguans?

Experts say canal plans and impacts remain shrouded in mystery

A volcanic island rises from Lake Nicaragua. Photo by Aaron Escobar/Creative Commons 2.0

A volcanic island rises from Lake Nicaragua. Photo by Aaron Escobar/Creative Commons 2.0

“A big Christmas present”—that is how Paul Oquist, an advisor to Nicaraguan president, Daniel Ortega, described the country’s plan to build a mega-canal across the nation. Preliminary construction on the canal is set to begin December 24th, despite major concerns over environmental destruction, forced removal of thousands of people, and a lack of transparency.

“The Nicaraguan people will get a big Christmas present,” Oquist told the Guardian. “It has always been pending and now it can happen.”

The canal, also known as the Gran Canal and the Interoceanic Canal, has been a pipe-dream for some in Nicaragua for centuries. In fact, Nicaragua was initially proposed as the original site of what is today the Panama canal. Now, the government appears to be pushing full-steam ahead after announcing the official route in July, stating construction will begin in less than a month. But like the Panama canal, the Gran Canal will not be run by locals. Instead, the project will be constructed by a recently-formed Chinese company, called the Hong Kong Nicaragua Canal Development Investment Company (HKND Group). This company, headed by a telecommunications billionaire, has been granted a 50 year concession over the canal with a chance to renew for another 50 years.

“By announcing this ‘big Christmas present,’ the government is distorting reality,” Jorge Huete-Perez, the founder and director of the Molecular Biology Center at the University of Central America, told This year, Huete-Perez authored a commentary in Nature warning about the environmental impacts of the canal and recently participated in an independent workshop on the canal’s possible impacts.

Approximate canal route across southern Nicaragua, including Lake Nicaragua. Image from Global Forest Watch. Click to enlarge.

“No doubt [the canal’s approval] was a present for the Chinese company…which has already benefitted by gaining the concession without any bidding and by being given all our natural resources, including Lake Cocibolca, the main water reservoir in Central America,” Huete-Perez continued. “For the ordinary Nicaraguan, however, a better Christmas present would have been an official announcement allowing for an independent scientific review of the environmental and socioeconomic studies…to learn that the government decided to stop all activity related to the construction of the Canal until these independent studies are completed. A better Christmas present would have been to learn about the feasibility of the project, to hear from the government that it will respect indigenous people’s right to consultation.”

Costing at least $40 billion, the canal will be nearly four times as long as the Panama canal, cutting across 278 kilometers (173 miles) of Nicaragua. It will cut along the borders of three protected areas and slice directly through Lake Cocibolca, also known as Lake Nicaragua, the largest freshwater lake in Central America. The canal will sever the Mesoamerican Biological Corridor, which currently connects wildlife across eight Central American countries. It will also mean the forcible removal of around 300 communities, including indigenous communities.

The environmental concerns related to the canal are also long: water scarcity and pollution, biodiversity loss, extinction, oil spills, deforestation, and fish declines among others.

But for Huete-Perez one of the biggest questions surrounding the canal: is why all the secrecy? To date, official plans for the canal have been shrouded in mystery. The impacts of the canal are currently being studied by the British company, ERM, which was hired by HKND. But just weeks before construction is to begin there have been no publicly-released analysis of environmental impacts. In fact, Huete-Perez says these studies have been pushed back to April of next year, four months after construction begins.

“The lack of scientific and technical information has made it very difficult to thoroughly analyze the consequences that the canal project may have,” Huete-Perez said. “The only official document we know of is the Canal Concession, along with a couple of PowerPoint presentations summarizing the project design. Unfortunately both HKND and ERM are hiding relevant information from public scrutiny.”

A bull shark in the Bahamas. This species was once abundant in Lake Nicaragua, today it is almost gone. Photo by: Public Domain.
A bull shark in the Bahamas. This species was once abundant in Lake Nicaragua, today it is almost gone. Photo by: Public Domain.

He said that recent presentations to local communities were more a “publicity stunt” instead of a much-touted consultation. HKND has been granted territory to all land within the canal zone and will be able to evict residents, however communities don’t know where they will be moved or how much compensation will be paid to them. In response to this, some locals have threatened to arm themselves.

Meanwhile, the canal threatens to exacerbate already high deforestation rates, push species closer to extinction, and irreversibly pollute the nation’s biggest source of fresh water.

“These circumstances make it nearly impossible to independently assess the possible environmental and social costs that Nicaragua will face starting this December,” noted Huete-Perez.

Recently, Huete-Perez and several other experts headed an international workshop on the Gran Canal, hosted by The Academy of Sciences of Nicaragua, the InterAmerican Network of Academies of Science (IANAS), and the International Council for Science. The workshop looked at issues such as water scarcity in Lake Nicaragua, where dredged soils could end up, how the mega-project might impact biodiversity, and whether or not the project even makes economic sense. But Huete-Perez says the biggest takeaway from the meeting was a lack of knowledge about the government’s and HKND’s plans.

“In my view, one of the main conclusions of the expert panel was that transparency and public participation need to be encouraged. The panel underlined the need to adopt international best practices for the evaluation of the mega project. According to the experts, these practices include broad and transparent communication with multiple stakeholders.”

A view of Lake Nicaragua. Photo by: Zach Klein.
A view of Lake Nicaragua. Photo by: Zach Klein/Creative Commons 2.0.

He noted that while the workshop posed over 30 key questions, all of them were left “presently unanswered” due to the government leaving the public in the dark. One of the most important was: would the government consider an alternate route for the canal that would bypass Lake Nicaragua? All the routes considered publicly were through the lake.

Recently, the Association for Tropical Biology and Conservation (ATBC)—the world’s largest association of tropical biologists and conservationists—called on Nicaragua to halt the planned canal and allow the Inter-American Commission on Human Rights (IACHR) and UNESCO to conduct “a thorough, transparent and independent scientific review of the long term environmental and social consequences.”

For its part, the government argues that Gran Canal will transform Nicaragua practically overnight, hence the description of it as a “big Christmas present.” It has predicted the canal will lift 400,000 Nicaraguans out of poverty by 2018. The claim is important as the Central American nation is the second poorest in the Western Hemisphere after Haiti.

“At the end of the day, everyone’s going to be better off than they were before…The ones who complain will be the ones who miss out,” Oquist, the advior to Nicaragua’s president, Daniel Ortego, also told the Guardian.

But Huete-Perez isn’t convinced, noting that many are concerned the project will only benefit the rich, the powerful, and foreigners.

“The challenge is that the project not just serve the interests of the national oligarchy, today allied to Chinese capital, but benefit all of the Nicaraguan society,” he said.

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