Storm clouds gather over Hong Kong-backed canal that will slice through Nicaragua

As he gazes from his porch at the Pacific Ocean, fisherman Pedro Luis Gutierrez conjures a vision: one day, mammoth ocean-going vessels will sail here from afar and vanish into a canal piercing the jungle.

"The ships will cross over there in the middle of the beach," says Gutierrez, who's heard about plans to build a rival to the Panama Canal in Nicaragua.

For now, an inland waterway is a mirage. Few outside of Nicaragua took seriously the announcement last year that a Hong Kong-based company had won a 50-year renewable concession to build a canal. But the plan is moving along quickly. Scores of Chinese engineers have mapped the topography here, and deal-makers in Hong Kong are scouring the globe for investors.

Sometime later this year, President Daniel Ortega and Chinese telecom tycoon Wang Jing will decide if the project should get the green light. That could unleash earthmovers on one of the largest engineering challenges the world has seen, comparable to the mainland's enormous Three Gorges Dam.

The stakes are high: if the transoceanic canal gets the go-ahead, it might take a decade to build, gobble US$60 billion and slice through vast stretches of tropical forest. At 290 kilometres, it would be more than three times the length of the US-built Panama Canal. Plans indicate it would accommodate supertankers and giant container ships that are far bigger than those the Panama waterway will accept when its expansion is complete next year.

For Nicaragua, the project may launch this nation of five million people from poverty, creating jobs and prosperity.

For China, the plan would mean easier access to crude oil from Venezuela and a greater foothold in the western hemisphere. Such geopolitical considerations may mean more for China than the price tag.