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Thread: Some thoughts on the Big Ditch

  1. #1
    Viejo del Foro Daddy-YO's Avatar
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    Default Some thoughts on the Big Ditch

    Certainly it's an impressive plan. Thanks to Bill_Bly_CA for the press release pdf (powerpoint).

    To make such a large artificial lake in Punta Gorda Nature Reserve, to dig & shore-up 173 km of canal (total 278-105 thru Lago Colcibolca) 30 m deep such that it'll be earthquake proof, with only two locks (Atlantic & Pacific) is bold, but doable. Projected ports Brito (17 km N of San Juan del Sur) and one at Eagle Point are each planned to be able to hold millions of tons of petroleum plus a few million containers. Just N of Rivas, on the lake, an airport (3200 m runway) capable of allowing a million passenger a year to come & go is a sub-project, along with 600 km of highways, elaborate tourist complexes and an expansive duty-free zone. Other sub-plans treat the necessity of building cement, steel & power (electricity) plants.

    Ambitious is an inadequate word here. Early estimates put the cost at 4X Nica's GDP, some $50 billion. HKND (= Wang Jing =? China) wants investors (suckers?). The Sandinistas/Ortega have granted Wang exclusive rights to operate the canal for 50 years, with an option to extend the contract for 50 more years.

    This makes me chuckle. The contract is only as good as the government that awards & honors it (absent external enforcement). What government in Latin America will last 100 years? (The PRI in Mexico has, but it's in the process of shafting 'el pueblo' over Pemex.) Even with grooming son Laureano to continue the Ortega-Murillo-Sandinista dynasty (insured by Wang's money), figure this Nica government could last 20-25 years tops. By that time, unless Wang-Ortega has made every poor Nica a king, the next government will disown all prior agreements not amended with arm-bending piles of cash put in the many greedy new palms.

    So what's the gambit? A shrewed capitalistic mega-opportunity in an ever-expanding global economy? Or old fashion geo-militaristic foreplay to the next (last?) world war? The Moscow Times (6 May 2014) has reported that Russia will take part in the building of the Nicaragua Canal, viewing the project in part as an opportunity to pursue strategic interests in the region.(Wiki) Is the billionaire 'empresario' Wang merely a Chinese military agent 'buying' access?

    Certainly all developments so close to the 'Homeland' will be carefully monitored (assuming US gov't agencies aren't too busy reading other people's steamy e-mails & viewing their photos).


    Gran canal (official Nica webpage): Oops! Google Chrome could not find www.grancanal.gob.ni
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  2. #2
    Viejo del Foro Daddy-YO's Avatar
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    Default Re: Some thoughts on the Big Ditch

    Coincidentally, after I plugged my thoughts into TRN submission box, I saw today's NYTimes has an article on the same topic,
    A Second Canal for Central America — or a Pipe Dream

    Here are two quotes from it:
    "The Nicaraguan lawmaker Eliseo Nunez, who opposes construction, called HKND’s announcement “a propaganda game, a media show to continue generating false hopes of future prosperity among Nicaraguans.”

    "Greg Miller, writing for Wired, is also skeptical of Grand Canal fanfare. “How HKND — apparently the only company to submit a bid — managed to land the deal, isn’t clear, leaving many Nicaraguans frustrated by their government’s lack of transparency,” he explains. “Exactly where the money to build the canal will come from is another mystery, as is the role, if any, the Chinese government will play.”
    I never met a Semite I didn't like.

  3. #3
    TRN Science officer bill_bly_ca's Avatar
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    Default Re: Some thoughts on the Big Ditch

    Here are my thoughts...

    1) Hugo oil - China has spotted $40B to Venezuela since 2008. In return Manure-o sends 640K barrels a day back to China - About 340,000/b of that is debt repayment. A China controlled canal puts an insurance marker on that supply. @$100/b that is $34M /day .. $12B/yr...
    1a) Now if you add Nigerian oil to that , which would not have to go around the cape any longer.. They sank $10B into Nigeria in 2013..

    2) It is almost equidistant from Shanghai to the EU either using the pirate laden waters of the indian ocean, the unstable suez, all against the wind... Or with the wind at their back through Nica. And with a bigger canal they can send a bigger ship that distance.

    3) As you see if China can spend $40B in 6 years on a tin pot despot for a consumable, why would they not balk at $40B, over 10 yrs for a 100 year return on the capitol expense? Think like the Louisiana purchase, not quarter to quarter results or year end to year end here..

    4) Soft Chinese economy - They need to stimulate growth.. Their zero percent growth is 6% growth.. This is to absorb the migration to the cities and avoid public unrest at home. If they can sell $30B of Chinese product into a $40B canal guess how much the Chinese economy has grown by..

    5) 2013 Panama canal tolls... Income from tolls is estimated to reach $1.85bn for 2013... Who do you think pays most if not all of that $1.85B dollars already eh??? ...


    Graphic.. This is how they are thinking big...



    Data point #2 - Found this very interesting PDF as well... Link
    Last edited by bill_bly_ca; 07-10-2014 at 09:22 PM.
    ==================================================
    Dude !!!.... Its a Canal !!! Can you Dig it ??

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    Dog Whisperer cookshow's Avatar
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    Default Re: Some thoughts on the Big Ditch

    Bill nails it, as unbelievable as the Canal may be there is the $$ to do the project and people that have a deep interest in it becoming reality.
    ‎"You know what you say when people tell you you can't do something? Fool, shut your mouth up!"
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  5. #5

    Default Re: Some thoughts on the Big Ditch

    My bedtime reading lately is a history of Arizona. Seems when the railroads came in to a frontier environment they found ways to get things done, winner take all! The chinese Communist party and the Ortegas are far more cunning and powerful than any railroad exec.

    Geopolitically, once the canal is done, the Chinese (and probably the Russians) will have their bases, and the great anti-democratic cabal in the world (china, iran, venezuela, assorted 3rd world dictators, etc. ) will use the Nic canal to give it its core customers.

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    Viejo del Foro Daddy-YO's Avatar
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    Default Re: Some thoughts on the Big Ditch

    To Bill, thanks for your thoughts, here're some back at you:

    Please note that China, the country, is carefully NOT involved in this. It's strictly the 'empresario' billionaire Wang Jing of Hong Kong, China, who has been granted exclusive rights, and has been dealing closely with Nica's heir apparent Ortega-Murillo. With that ticket Wang seeks investors.

    The situation is comparable to US shipping magnate Cornelius Vanderbilt a century & a half ago. He exploited the Rio San Juan - Lago Nicaragua route for rich passengers during the California gold rush. He had an exclusive deal. It was Wm Walker's successful (to a point) military adventures in Nicaragua at the time that got presidential attention. (And 'patriotic' admiration & support - it fit the 'manifest destiny' vision the young expanding country had of itself.) When Walker tried to take over Vanderbilt's route, Cornelius pulled his legs out from under him.

    As for Wang's investors there's a virtual sea of money held by the global elite looking for a good rate of return. But they're greedy and want their profits now, so bonds on the project will get traded based on 'expectations' (flashy, realistic plans), progress & prospects. The projected 'completion' date of 2020 is set to lure 'em in.

    "Wang’s previous venture, the telecommunications company Xinwei, has boasted it has orchestrated an array of deals worth more than $5 billion over the last three years but an examination of those claims by The Associated Press showed that Xinwei’s promises to build revolutionary new telecom networks had yet to materialize and deals with local partners were marred by false starts and poor performance." (from Wash Post (12/12/13) by AP)

    Bill, if the only considerations were economic, the points you raise seem to be valid & persuasive reasons to go ahead with this major project. Except for 1). Surely the most economical way for China Inc. to remove big gulps of Venezuelan oil would be a pipeline. Back in the 70s, when Texaco had developed several new, very productive wells in Ecuador's Amazon region, it used heliocopters (Vietnam vet pilots) to lay pipe across the Andes mountains to the port of Esmeraldas.

    But I understand that all your points taken together are a collective economic argument for doing it.

    That this unprecedented engineering project is to take place in the poorest country in continental Latin America ought to give pause for more thought. Supporters - believers - don't see this as a capitalistic venture. They see the superpower China Inc as delivering little Nicaragua into the modern world in one fell swoop, in the face of the big, bad supermeanie Americans.

    What stands against it is history, not that we're slaves to the past, but we'd be fools to ignore it. The Soviet Union had good reasons for helping tiny Communist Cuba, but three stood out: location, location, location. With the USA in Turkey & Germany aiming down their throats, it only seemed fair, balanced. Are we done with that sort of Cold War tomfoolery? Ask yourself: is the world still divided into nation-states with armies & navies?

    The sea lanes around Asia are today being contested. Japan's Abe has moved to increase military strength, against its WWII-dictated constitution. Russia took Crimea in a military foray. The European Union strains at the seams to follow Germany's lead. Meanwhile Germany says, "Don't spy on us" - trust us. OK.

    And dig this old news (WaPo 12/12/13):
    "Wang ... announced last week he will spearhead a $3 billion joint venture to construct a deep-water port and refurbish the Sevastopol port on Ukraine’s Crimean Peninsula, ...”

    It's a small, small. small world after all.
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