Nicaraguan assembly OKs $40 bln Chinese canal to rival Panama's [View all]

[Judi Lynn]

Nicaraguan assembly OKs $40 bln Chinese canal to rival Panama's
MANAGUA, June 13 | Thu Jun 13, 2013 5:06pm EDT

(Reuters) - Nicaragua's national assembly on Thursday approved a 50-year concession to a Hong Kong-based Chinese company to design, build and manage at an estimated cost of $40 billion a shipping canal across the central American nation that would compete with the Panama Canal.

The proposal by HK Nicaragua Canal Development Investment Co Ltd's (HKND Group) envisages linking Nicaragua's Caribbean and Pacific coasts and includes plans for two free trade zones, a railway, an oil pipeline and airports.

The government says the proposed canal, which has been mooted for years by Nicaraguan lawmakers, could add up to 15 percent to the country's gross domestic product.

"Today is a day of hope for the poor of this country," said Edwin Castro, a lawmaker in President Daniel Ortega's ruling Sandinista National Liberation Front party, before the vote that marked final legislative approval of the deal.

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