Uniting the Oceans

At the request of President Daniel Ortega, the Congress of Nicaragua has adopted a project to construct an transoceanic canal for the route of the San Juan River and the great Lake of Nicaragua. The location, proposed since the time of the first Spanish colonies, was the alternative chosen by the famous Commodore Vanderbilt, who tried to build a passage to connect the Atlantic with the Pacific in competition to the project that preferred the Panama route. As was the project’s downfall, though, the preferred path turned out to be Panama, and, as is well known, this path triumphed after overcoming immense difficulties.

First, an American company built a railway connecting both oceans. Then, after a frustrated attempt by a French company headed by Ferdinand de Lesseps, the United States accomplished this astounding feat — technically and logistically — creating a path between two great seas of the planet in the early twentieth century. The Panama Canal was the greatest engineering feat of its time, quickly becoming a stimulus for world trade, since it reduced the international costs for commercial transactions. After several decades, however, the canal became too narrow for the huge ships that took advantage of the revolution in transport that introduced the use of containers. These ships proved too large to pass through its magnificent locks.

Nicaraguans always regret that their country was not chosen for such a great enterprise, and now, as world trade continues to grow despite the crisis, their dream of having their own canal is reviving. A consortium of international investors, led by a Hong Kong businessman, designed the draft of the operational plan to start on the giant project that would be required in order to open the route. The estimated cost is US$40 billion. There are, however, detractors and criticisms.

Nicaragua Canal

Among the main technical objections is the shallowness of Lake of Nicaragua, which would require enormous works of dredging. The project could also have a very negative impact on the fauna and forests a of the region, which would be  split into two sides with no communication route in between. Costa Rica, which shares a stretch of the San Juan River, could also raise compelling objections.

The major criticisms in Nicaragua, however, are about the financial terms of the plan, which would leave an important part of the country under the control of the construction company for almost one hundred years. Also, there is concern that President Ortega will get personally involved — or could get involved — in the consortium of the new canal. Ortega, beyond the leftist rhetoric that has aligned him with Venezuelan chavismo, is in practice both a skillful negotiator and a populist who never discards good business, especially when it benefits him personally.

Nicaragua is not the only country that cherished the hope of linking both oceans, providing routes that compete with the traditional Panama Canal. Mexico, for example, is bringing forward work to complete a high-speed railroad through the isthmus of Tehuantepec, between the port of Coatzacoalcos and the port of Salina Cruz.

Meanwhile, a large group of prospectors is buying lands in Eastern Guatemala to build what they call a “dry canal” which would connect the two oceans. The project would consist of two rapid railways, a superhighway, and a pipeline. Promoters claim to have a single property — bought or secured by means of  stock transactions— that joins the Pacific Ocean with the Atlantic Ocean.

Also, in Honduras, there is a plan to construct a wide and complex transoceanic corridor. In fact, the topic is discussed in all the Central American countries, and even in Colombia, since they all are eager to participate in some way in a new age of prosperity.

Proponents are beset by criticism, doubts, discussions, and questions on all sides. Somewhat hastily, the ecologists already warn about the dangers of such works, manifesting in general a conservative position that, if followed to the letter, would paralyze completely the economic development of countries that need to progress. Other conservatives note that the commercial trade volume is not enough to justify so many initiatives that are competing with each other.

There are reasonable arguments on all sides, but when dealing with large infrastructure projects one must remember that de decision must be made not only taking into account existing realities, but also the potential changes regarding the demand for services generated by the project itself.

Even if most of these projects are not going to materialize, as is very probable, the desire for appearing on the map of the major transport routes of the world is a positive signal for us: Latin Americans want to be leading players in the expansion of the world economy. At preset the region is seen as a bridge and not like an obstacle for other continents and, most importantly, it seems to be abandoning its tendency for corruption and cronyism. These have harmed Latin America’s development in the second half of last century and they still persist openly in countries such as Argentina or Venezuela.

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