On July 3 the National Assembly approved a bill authorizing the construction of a shipping canal across Nicaragua connecting the Atlantic and Pacific Oceans and, on July 7, President Daniel Ortega signed it into law. The vote in the National Assembly was 85 votes in favor, zero opposed and two abstentions. The canal would be built over a period of ten years at an estimated cost of US$30 billion. The Nicaraguan state would own 51% of the canal company, offering 49% to investors who could be other nation states, international organizations, corporations or individuals. In signing the bill, Ortega noted that the canal had been a dream of national hero Augusto Sandino. National Assembly President Rene Nuñez said that it had been studied by Nicaraguan authorities since 1833. [Another study put the first feasibility study for a canal even earlier, saying it was ordered by King Philip II of Spain in 1567.]
Noting the continued increase in international shipping and the probable benefits to the Nicaraguan economy, opposition deputies in the Assembly supported the bill. Liberal Party Deputy Wilfredo Navarro said, “I don’t know if we will get the funds for this canal but it is a hope.” Former vice-presidential candidate Edmundo Jarquin, however, said the president was “selling illusions about the future to mitigate the difficulties of the present.”
The new law created the Grand Inter-Oceanic Canal Authority to carry out environmental studies and feasibility studies of the six possible routes, and to seek investors. At the moment, conversations have been held with Brazil, China, Russia and Venezuela. Venezuelan Ambassador to Nicaragua Maria Alejandra Avila told a Managua television station that the canal was “a manifestation of sovereignty” and Venezuela was interested in investing. Belgian investors also expressed interest. Nicaraguan authorities said that the canal would be complementary and not competitive with the enlarged Panama Canal. They also said that property owners along the route of the canal would be compensated for the loss of their property. Vice-Minister of Foreign Affairs Manuel Coronel Kautz said that preliminary studies had already been done and a decision would be made as to the best route in about four months.
One of the possible routes for the canal would be using the San Juan River and because the southern bank of the river forms the border between Nicaragua and Costa Rica, the Costa Rican government said that Nicaragua had to get its opinion about the project. Jaime Incer Barquero, presidential advisor for the environment said, however, that while Costa Rica could make observations, it could have no role in decision making about the canal because the river belongs in its entirety to Nicaragua. There were no reports of statements from environmental organizations in the news this week, but previous statements have noted that [as happened in Panama], because water is so essential to the functioning of a canal, preservation of the rain forest becomes by necessity a matter of top national interest.