China's Hong Kong Nicaragua Development (HKND) Co. said it is delaying the start of construction on a controversial $50 billion inter-ocean canal across Nicaragua until late 2016.
HKND has obtained approval for environmental studies of the canal earlier this month. But on Wednesday, a company statement said that the construction will start toward the end of 2016.
While the Hong Kong-based developer did not give a reason for the delay, it said in a statement that “the current design was being fine tuned,” and construction locks and excavations would start toward the end of 2016.
The 172-mile canal project, dubbed the largest ever human engineering endeavor, was being funded by Wang Jing, the CEO of HKND Group.
HKND received a 50-year concession from President Daniel Ortega’s government in 2013 to build and run the canal. The 50-year concession can be renewed once. The canal had been scheduled for completion in 2019, but HKND did not immediately offer a new completion date estimate.
The integrated Nicaragua Grand Canal project will include the following 6 sub projects: Canal (including locks), 2 Ports, a Free Trade Zone, Holiday Resorts, an International Airport and several roads. In addition, there will be construction of a power station, cement factory and other related facilities to ensure the successful completion of the canal within 5 years.
The proposed canal has drawn outrage among indigenous communities and farmers in the Latin American country who fear their lands will be seized for the project. Local communities and international observers have raised concerns over the paucity of details about the impact on environment, dubious promises of economic growth and the lack of clarity over its financing.
Some experts doubt the canal will ultimately be built due to financial, environmental and social concerns.
The Panama Canal, completed in 1914 to offer a shortcut and safer journey for maritime traffic between the Pacific and Atlantic, is currently undergoing a refit to triple its capacity.
