Canal builder joins Ukraine project

PUBLISHED : Friday, 06 December, 2013, 5:09am
UPDATED : Friday, 06 December, 2013, 5:09am

Wang Jing, whose company won the right to build a canal across Nicaragua, has agreed to invest in the construction of ports and facilities in Sevastopol, Ukraine, for US$3 billion.

Beijing Interoceanic Canal Investment Management (BICIM), controlled by Wang, will develop the ports with Kievgidroinvest, a Ukraine company which designs and develops water projects.

The first phase of the project would include an economic development zone with high-technology industrial parks, Wang said yesterday during an official visit to Beijing of Ukraine's President Viktor Yanukovych.

The second phase, which requires an additional investment of US$7 billion, will include the construction of a refinery plant, liquefied natural gas production base, airport and shipyard.

BICIM is the holding company of HKND, which won the concession in June to build the crossing in Nicaragua to rival the Panama Canal.

The ports project, which would benefit trade between China and Europe, had won the support of the Chinese and Ukraine governments, said Wang, who held a meeting with Vice-Premier Ma Kai and Yanukovych on the project yesterday.

"We are keen on investing in projects that can benefit global trade," he said, adding the shipping route between China and northern Europe could be cut by 6,000 kilometres on completion of the deep-water port in the Crimean peninsula.

Wang said the shareholding of BICIM in the ports project was slightly bigger than its Ukraine partner. "Funding is a key factor, and we have secured support from financial institutions and other parties for the initial investment," he said, without providing details.

Mazyuk Aleksey, a representative of Kievgidroinvest, said BICIM was the first Chinese company it approached when it sought a joint-venture partner.

"Although there are many state-owned Chinese companies that have solid experience in building infrastructure, we also look for a strategic partner with global insight," he said.

The experience of HKND in building the Nicaragua canal would also benefit the Ukraine port project, Aleksey said. Wang said the route for the Nicaragua canal had been fixed, with the investment in the project to increase by US$10 billion to US$50 billion.