In a decision that has sparked heated debate throughout Central America, the Nicaraguan National Assembly, led by President Daniel Ortega and his leftist Sandinista Front, recently approved a massive canal project that hopes to achieve “Panama-style prosperity.”

The plan proposes to link Nicaragua’s Caribbean and Pacific coasts to a Chinese company who will “transform one of the region’s poorest countries” by bringing many jobs to the country and fueling a sure economic boom to mimic nearby Panama. The Nicaraguan government seems to view this project as a panacea for its troubles, as recently its slow economic growth rates have landed it in the position of the hemisphere’s second-poorest country after Haiti.

The Hong Kong-based company plans to start evaluating the project’s feasibility soon, and forecasts a total cost of over $40 billion, a hefty cost that will require foreign investors. Despite the costs, Sandinista congressmen Jacinto Suarez is optimistic about the project, claiming “global trade demands that this canal is built because it is necessary.”

Not everyone is as optimistic as Suarez, however, about the sure success of the project. Though the idea to build a canal through Nicaragua to boost its economic viability has been around for a long time; former proponents of the project have now become hesitant and even a bit skeptical. Particularly, shipping experts and environmentalist are concerned that the canal project proposal passed in what critics are calling a “lightning-fast approval process,” despite the fact that the legislation contained no specific route for the canal or any details about its financing. While environmentalists worry that the canal will surely cross and deplete Lake Nicaragua, the country’s primary source of fresh water, shipping experts question whether Nicaragua is truly slated to achieve prosperity of Panama’s proportions.

The situation may require a deeper look at the true economic and political relations between the U.S. and Panama, both at the opening of the canal and today.

Further, Nicaraguan nationalists argue that Nicaragua “is not for sale” and fears how such a tremendous Chinese influence will affect the country’s sense of patriotism and national sentiment. These nationalists dismiss the potential economic advantages the canal could allow their country, claiming that the canal would benefit the Chinese tradesmen more than the native Nicaraguans.

What the argument comes down to, essentially, is a question of winners and losers. The Nicaraguan canal will bring economic prosperity and facilitate trade in the region and thus is a step in the right direction…but for whom? If the answer is the Chinese, one must evaluate what Nicaragua stands to gain—and perhaps to lose—from passing this proposal without a second thought.

– Alexandra Bruschi

Sources: Eye Witness 9, Yahoo! News
Photo: Tierra