The Nicaragua National Assembly has ratified the government’s commercial agreement with HKND Group to develop the Nicaragua Canal and Development Project, which could compete with the Panama Canal as another Atlantic-Pacific ocean link.
The deal grants HKND Group exclusive rights for the planning, design, construction, operation and management of the Nicaragua Canal — a 130-mile canal linking the Pacific Ocean to the Atlantic Ocean from Monkey Point to the Port of Corinto on the Pacific Ocean — and other potential projects, including port projects, free trade zones, an international airport and other infrastructure development projects.
“Central America is at the center of north-south and east-west global trade flows, and we believe Nicaragua provides the perfect location for a new international shipping and logistics hub,” said Wang Jing, HKND Group chairman, in a written statement.
HKND Group has already determined that the route will not follow the San Juan River. ERM, a sustainability consulting company, is in the process of independently assessing the environmental and social impact of various routes under consideration.
“We have enlisted a global team of world-class experts to support HKND’s feasibility studies on multiple fronts, including outreach over time to a range of stakeholders with an interest in this new project,” said Ronald MacLean-Abaroa, HKND Group’s spokesperson.
Moreover, China Railway Construction Corp. has been engaged to conduct the initial technical feasibility assessment consistent with international, technical and other standards selected by HKND Group. McKinsey & Co. is also providing HKND with research and analysis.
“There is an enormous amount of work to be done, and we will provide future updates on our progress as we address key milestones ahead,” MacLean-Abaroa concluded.
Initial findings from HKND’s commercial analysis indicated that increasing east-west trade and larger ships provide a “compelling argument” for the construction of a second canal across Central America. HKND Group said it believes that by 2030 the volume of trade addressable by the Nicaragua Canal will have risen 240 percent from today.