HKND Group, a unit of holding company the HK Nicaragua Canal Development Investment, won a concession in June 2013 to design, build and manage a US$40 billion canal in Nicaragua to rival Panama despite having no infrastructure experience.
Nicaragua indigenous groups challenge Hong Kong-built canal
Nicaraguan civil society groups have challenged plans by a Hong Kong company to build an interoceanic canal through the Central American country, arguing that they have not been sufficiently involved in the decision-making process.
On Monday, representatives of indigenous and creole community groups of Nicaragua's eastern Autonomous Region of the Southern Atlantic said they had called on the country's Supreme Court to repeal the law allowing the construction of the canal.
HKND Group recently won a US$40 billion contract to build and operate a canal through Nicaragua that would dwarf the Panama Canal and would have major geopolitical implications.
The Nicaraguan parliament approved a law on the canal on June 13, providing a legal framework for an earlier memorandum of understanding signed after a meeting between President Manuel Ortega and HKND chairman Wang Jing.
"The passing means that the state accepts and approves in advance [a project] that will affect peoples of indigenous and of African descent, who had been excluded from the decision-making process," the Nicaragua Centre for Human Rights said in a statement on Tuesday.
The centre is sponsoring the complaint with the Supreme Court, calling for a repeal of the law, which gives the operator the right to determine the canal's technical, economic and environmental viability.
"There has to be a consultation with the indigenous population, because this project will affect the entire population with its own traditions and way of life," said Allen Clair Duncan, head of the communal government of Monkey Point, where a deep-water port is set to be built as part of the canal project, as reported by El Nuevo Diario on Tuesday.
Nicaragua's Vice-President Omar Halleslevens Acevedo dismissed these concerns as "hypothetical" in an interview with Nicaragua's leading daily newspaper, La Prensa, arguing that the route of the canal had not yet been decided.
A legal challenge will not go far, said a leading Nicaraguan journalist, speaking on condition of anonymity. "Since Ortega has full control of the judiciary, this is not going anywhere."
The canal would provide an alternative to the congested Panama Canal and substantially shorten routes for container ships that are too large for the US-built canal completed in 1914, which is currently also undergoing expansion. Yet, observers say the canal will still not be able to handle all the traffic.
The Nicaraguan project could turn the country of 5.9 million people, now Central America's poorest, into the region's richest nation, HKND spokesman Ronald MacLean Abaroad told the local daily Pagina Siete last month.
Work on the project, which also encompasses two ports, a railroad and an airport, is expected to begin next year. Xinwei, another company chaired by Wang, has also won a contract to upgrade Nicaragua's telecommunications network last September.
HKND did not immediately respond to a request for comment.