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Nicaraguan canal: between belief and skepticism

Tuesday, June 11, 2013

Many people may question Nicaragua’s plan to build a $40 billion trans-oceanic waterway, which would be two and a half times as long as the Panama Canal, longer even than Suez, and deeper than either.

The projected cost alone is staggering - more than four times bigger than Nicaragua's annual gross domestic product.

From a commercial viewpoint, it’s easy to question the concept.

Trade between the Atlantic and Pacific is sure to rise in coming years, but the increase will be not nearly enough to offset the huge capital cost of the Nicaraguan canal, many experts say.

For their part, critics of the government of President Daniel Ortega claim that "the project is simply a smokescreen to cover up dubious business deals", according to reports in the Spanish daily El País.

In addition, the Nicaraguan government still has to complete economic and environmental feasibility studies for the canal project.

But not everyone is skeptical. "It's a massive project, but in scope and in technology, it is really not that much different from cutting the original Panama Canal," said Jason Bittner, director of the Center for Urban Transportation Research at the University of Southern Florida.

The entire U.S. interstate highway system, for example, was a massive project, that nevertheless was built and that has had decades of use, Bittner added.