Nicaragua’s Canal Project at What Cost?

A proposed canal in Nicaragua would rival Panama's as a link between the Atlantic and Pacific Oceans. But indigenous and environmentalist protesters are crying foul.

Posted on 12/18/14
By Chris Hartmann | Via FPIF
Demonstrators protest Nicaragua’s planned canal in 2013. (Photo by Jorge Mejía Peralta, Creative Commons License)
Demonstrators protest Nicaragua’s planned canal in 2013. (Photo by Jorge Mejía Peralta, Creative Commons License)

What does a canal have to do with human rights?


Plenty, according to the thousands of Nicaraguan protesters who filled Managua’s streets on December 10, International Human Rights Day. With banners, flags, chants, and a petition submitted to the Nicaraguan Center for Human Rights, they came out in opposition to a proposed canal that would pass through Nicaragua, linking the Atlantic and Pacific oceans.


No doubt, the canal would increase Nicaragua’s economic importance in the region, bring in much needed income, and generate jobs. But those benefits come at steep costs: The canal is expected to devastate the environment. Moreover, it would displace indigenous communities and hurt some of the nation’s most marginalized peoples.


The proposed canal disregards several of Nicaragua’s constitutional mandates — including indigenous peoples’ rights to autonomy and self-determination, and the right to collective ownership of communal and indivisible lands. As the farmers, youth, rural villagers, and other demonstrators made clear in their protest, the canal would come at too high a price.


Economic Progress (for Elites)

In June 2013, Nicaraguan President Daniel Ortega hurriedly proposed and signed Law 840, which granted the Hong Kong Nicaragua Canal Development Investment Company, or the HKND Group — a Chinese corporation — a 50-year lease to the project, renewable for another 50 years.


The project’s investors have yet to be identified — a troubling fact that highlights its lack of transparency. HKND’s involvement reflects the ever-growing presence of East Asian investors — most notably Chinese — in Latin America, a region long dominated politically and economically by los gringos.


Construction on the proposed $50-billion canal is scheduled to begin on December 22. At 172 miles long, the Nicaragua canal will be three times the length of the Panama Canal further south. More importantly, it far exceeds the Panama Canal’s width and depth, enabling it to accommodate increasingly super-sized container ships that cannot fit through the Panama Canal’s locks.


The proposed canal is projected to be an economic boon, perhaps tripling the economic growth rate of Nicaragua — currently the second poorest country in the Western hemisphere, with 40 percent of its population living in poverty. But although the impoverished masses may benefit, however minimally, through trickle-down effects from the canal, it appears to be Nicaragua’s economic elite — including Ortega’s closest Sandinista supporters — who stand to gain the most.


Environmental Hazards

While those few are profiting, the proposed canal could have a catastrophic impact on the physical environment.


The planned route passes through Lake Nicaragua, Central America’s largest lake and a major source of drinking water. Dredging and salt infiltration from the canal are expected to permanently alter Lake Nicaragua’s ecosystem. The canal would also destroy more than 400,000 acres of rainforests and wetlands, which, besides being part of the Mesoamerican Biological Corridor, are critical to local and regional biodiversity conservation efforts.


In response to environmentalists, project proponents argue that the canal is needed to saveNicaragua’s protected areas from illegal loggers and cattle ranchers. They say that increased revenue will allow for more surveillance and better enforcement of environmental regulations in the region.


Who is right? Developers aren’t waiting to see. Even as construction on two auxiliary projects — a deep-water port and highways for transporting large machinery — was scheduled to begin, the results of an environmental study had yet to be released.


Impacts on Indigenous Groups and the Rural Poor

Beyond environmental devastation, the proposed canal could have tremendous social implications.


Like the environmental impact study, results of a social impact assessment have similarly yet to be released. But those most likely to be displaced by the canal are impoverished rural landholders. Farmers and residents near the lake are concerned that the proposed canal will disrupt subsistence agricultural practices, further pollute the lake, and decrease water for personal consumption and irrigation. Both farmers and residents worry they will be evicted from their lands, and many will refuse to leave willingly.


The proposed canal also intersects territory traditionally held by indigenous groups. Accounting for almost 9 percent of the national population, much of Nicaragua’s indigenous population is located along the sparsely populated yet extensive Atlantic Coast region that makes up approximately one-half of the country’s total land area.


Since the 1980s, when conflicts erupted over how to govern the Atlantic Coast regions, indigenous groups have had a tense relationship with the ruling Sandinista party. In 1987, the Sandinistas passed legislation establishing an autonomous regime in the Atlantic Coast and granting collective territorial rights to its inhabitants under a multiethnic nation-state. Earlier this year, constitutional amendments clarified and extended rights concerning cultural preservation, collective territory, and autonomy. Yet, as in the past, central government figures in Managua continue to make decisions concerning the autonomous regions and their inhabitants without consultation and local input.


In recent years, indigenous groups have increasingly confronted cattle ranchers, illegal loggers, and drug traffickers, all of whom encroach on their land and cultures. Mestizos now outnumber indigenous and African-descendent populations in this region along the Atlantic coast, consequently reducing their political power. The proposed canal, along with associated development projects — including extensive roads, several locks, massive ports, and a free trade zone — will likely exacerbate local strife. 


Standing up to Resist

Indigenous groups and rural landholders are not standing by idly. Several indigenous groups have filed suit against the Ortega administration, alleging violations of constitutional and international rights, including the United Nations Declaration of the Rights of Indigenous Peoples.


And tens of thousands of Nicaraguans — along with a slew of local, national, and international NGOs — have participated in more than a dozen protests around the country, crying out that “Our lands are not negotiable, are not for sale, and are not given away!” They demand transparency and dialogue about the canal.


Things need to change, and the sooner the better. Nicaragua and HKND must release environmental and social impact surveys. And now, more than ever, the Nicaraguan government, HKND Group, and yet-to-be-identified international investors must recognize indigenous groups’ decades-old rights to autonomy. The livelihoods, cultures, and rights of tens of thousands of marginalized Nicaraguans depend on it.


Chris Hartmann, a doctoral candidate in geography at the Ohio State University, examines the political economy of Nicaragua.

This article first appeared in the FPIF. Click here to go to the original. 

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