Nicaragua’s canal-sized pipe dream


The Panama Canal took a decade to complete, cost the lives of thousands of workers and proved one of the largest and most difficult engineering projects ever undertaken.

So why not a repeat performance?

Earlier this month, the Nicaraguan legislature approved construction of a canal to compete with the Panama Canal, an endeavor that would double the number of shortcuts between the Atlantic and Pacific oceans.

The project would apparently be built by a Chinese telecommunications equipment firm, with financing largely coming from China, according to the magazine The American.

The project envisions building a canal as long as 178 miles (the Panama Canal is 48 miles, by comparison), as well as two deep-water ports, two free-trade zones, an oil pipeline, a railroad and an international airport, according to the Wall Street Journal.

The cost is estimated at a staggering $40 billion, about four times the country’s annual gross domestic product.

Supporters of the latest iteration of the project, approved last week, hope that it will propel Nicaragua out of its economic doldrums by bolstering employment and economic growth, added the Journal.

“But there is also ample suspicion that the project will flounder, as so many others have done since the first government contract for a canal through Nicaragua was awarded in 1825,” the publication added.

Route No. 3 shows a proposed canal route through Nicaragua.

Route No. 3 shows a proposed canal route through Nicaragua. No. 5 is the Panama Canal.

Among potential pitfalls is Nicaragua’s seismic stability. Volcanos and earthquakes are an issue in the nation, with 2,000 dying in 1931 quake in the nation’s capital, Managua, and 5,000 more in a 1972 tremor in the same area.

“Since official sources list six possible routes for the new canal, all through Lake Nicaragua, the geological risks are still unknown,” according to The American. “And it is possible that the risks do not really matter to the Sandinista leadership as long as construction money pours into the nation’s economy.”

Finally, it’s uncertain a new canal would even be financially viable, especially given that the Panama Canal is currently being widened to accommodate larger ships.

“It is not clear that we will need more capacity than the widened Panama Canal in the next few decades,” The American noted.

“Geographer Jean-Paul Rodrigue told the Wall Street Journal that the Nicaraguan canal is possibly ‘the biggest white elephant in human history,’ and noted in an interview last year that Nicaraguan political instability made the project doubtful,” it added.

12 thoughts on “Nicaragua’s canal-sized pipe dream

    • If they cut a canal through Nicaragua and there’s already a canal through Panama, wouldn’t the part in the middle just float away? If I’m living in Costa Rica, I’m *real* unhappy with this idea.

      Why is it that no one ever thinks about these crucial complications until it’s too late? When the heavy lifting – thinking wise – is left to me, we’re in serious trouble.

  1. Wow, that’s quite an undertaking, quite an expense. Competition at its best, but like you are saying, it doesn’t sound like thinking is at its best. 🙂

  2. Now how many people in Central/South America could that money feed?

    On a more mundane level, a few years ago our local government in Spain installed a tramway. Go-ahead, and to be fair, not a bad idea. Just unnecessary. Bus fares went up as part of the integrated transport system and now the tramway can’t be funded. It’s redundant and grass grows on the tracks.

    • I’ve never understood bureaucrats’ desire to have the latest and greatest gadgets. I guess because it’s not their money they don’t have a problem spending it. Actually, I do understand it: They get the good press and accolades that go along with bringing in things like tramways and by the time it goes under, they’ve moved on to greener pastures usually. As long as the politicos have something impressive for their resume, I guess. The sad part is that, in your case, bus fares went up, so everyone else ended up paying more for a redundant service.

      • They didn’t get any good press at the time they introduced it. It was seen as a white elephant back then, much like the Nicaragua canal.

        As for our local buses, the one which went directly to our county town now only goes as far as the local hospital, so that means two buses, therefore double the inflated price. What that actually means in reality is that more people walk down to the main road to get the express bus (cheaper and faster and no changing buses) rather than use the village one. Totally self-defeating policies.

        Why do people who plan transport never use it? Wonder how many of the ones proposing the canal are in shipping?

      • Excellent questions. It’s almost as if the people who plan these types of projects have never heard of the Law of Unintended Consequences. The difference between how we’d like things to work out and how they work out in reality is often very large.

  3. Nicaragua is significantly closer than Panama. From a shipping standpoint, the savings in fuel and time /cost of crew would be phenomenal. Reduced shipping cost/time mean a lot to many industries.

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