BEIJING May 5 Wang Jing, the enigmatic
businessman behind Nicaragua's $50 billion Interoceanic Grand
Canal, shrugs off scepticism about how a little-known
entrepreneur can be driving a huge transcontinental project,
insisting he's not an agent of the Beijing government.
"I know you don't believe me," said Wang, who reckons that
he's forked-out about $100 million in canal preparation work,
and is burning as much as $10 million a month on the project.
"You believe there are people from the Chinese government in
the background providing support. Why, in the end, is only Wang
Jing out front?"
High-ranking Chinese officials including President Xi
Jinping, Premier Li Keqiang and former leaders Jiang Zemin and
Wen Jiabao have all visited the state-connected wireless
communication technologies company Wang took control of four
Wang, whose entrepreneurism went mostly unnoticed in China
and elsewhere before last year's Nicaragua announcement and a
subsequent $3 billion Black Sea port development plan, has not
helped matters by refusing to talk in detail about himself or
broad swathes of his career.
During two interviews at the headquarters of Beijing Xinwei
Telecom Technology Inc and in several follow-up emails, the
41-year-old Wang discussed Nicaragua, Beijing Xinwei's recent
deal to undertake the biggest reverse takeover in Chinese stock
market history and his background, providing fresh details to a
life that remains mysterious.
"I was born in December 1972 in Beijing," said Wang. "All
these years I've lived a very ordinary life."
Wang grabbed global headlines last June when he sealed a
controversial no-bid 50-year renewable concession from
Nicaragua's Sandinista government to develop the $50 billion
canal to rival Panama's, and related facilities.
Nicaragua preparation is on schedule, Wang said. In January,
he and President Daniel Ortega issued a joint statement to
address what Wang described as "misleading reports" that the
start of construction would be delayed.
The proposed scope is enormous, comprising construction of a
waterway that may extend 130 miles (210 km), depending on the
route selected, along with two ports, a railway, oil pipeline,
and an international airport.
The canal would be longer, deeper and wider than the Panama
Canal, about 500 miles (800 km) to the southeast.
The scale of the project has led some to suggest it could
only be viable with the backing of the Chinese government, which
might see it as a geopolitical play to balance U.S. influence in
"I can't imagine (Wang) would have gone forward without at
least coordinating with the Chinese government," said R Evan
Ellis, assistant professor for Hemispheric Defense Studies at
National Defense University in Washington. "Big Chinese
companies just don't parachute down into Latin America."
The project, Ellis estimates, may provide China with
commercial leverage over key Latin American governments and
local companies, which may prove crucial to guarantee trade
routes and access to raw materials.
"How the project ends will likely depend on the government
of the People's Republic of China," he said.
For Wang, who can make a small fortune from licensing
arrangements alone, the project represents a perilous highwire
act. The ocean-connecting waterway has been criticized as the
proverbial white elephant, while Wang has been ridiculed in the
global press for lacking experience developing or financing big
Wang only established Hong Kong Nicaragua Canal Development
Investment Co (HKND) in August 2012 and opened offices in Hong
Kong's premier International Financial Center weeks ahead of the
June 2013 announcement.
Nicaraguan opposition politicians also question Wang's
commitment to addressing social and environmental issues,
particularly how the proposed project may affect Lake Nicaragua,
an important freshwater source in the region.
Wang has brought in international specialists to help quell
concerns. McKinsey & Co was hired to conduct an economic
feasibility study, while Environmental Resources Management Ltd
is conducting an environmental and social impact
study for the various routes under consideration.
SBE, the Belgium-based civil engineering firm specializing
in canal hydraulics, and MEC Mining, the Australia-based
engineering consultancy also have been hired. Washington
consultancy McLarty Associates and law firm Kirkland & Ellis
also were contracted.
As many as 400 engineers and technicians of different
nationalities are currently working on a canal feasibility
study, Nicaragua's Canal Authority head Manuel Coronel Kautz
told Reuters. There are between 600 and 700 people working on
the project, Wang said.
McKinsey & Co infrastructure partner Stefan Matzinger
declined to answer questions. ERM regional chief David McArthur,
McLarty Associate's managing partner Stephen Donehoo and
Kirkland & Ellis partner Chuan Li did not respond to emails or
FINDING $50 BILLION
Financing is a thornier issue.
Wang, who may be prepared to spend as much as $300 million
of his own cash, said that he will use a combination of
cross-shareholding, bank lending and debt issuance to raise the
estimated $50 billion needed to finance the project.
Five international groups had already agreed to invest in
the project, he added. "We have not only signed
memorandum-of-understanding, we are working on final
preparations for executable, irrevocable contracts," he said.
On April 23, Xugong Group Construction Machinery Co.
, one of China's biggest construction equipment
manufacturers, announced it had reached a framework agreement to
take a 1.5 to 3 percent stake in Wang's development company.
No dollar amount was attached to the investment, which also
would make Xugong the sole supplier of engineering equipment to
the canal project. More announcements are expected in the coming
weeks, Wang said.
Other companies that may participate in an international
consortium include state conglomerate China Railway Construction
Corp., China's biggest overseas engineering
contractor, which is one of Wang's strategic partners that has
been brought in to help with feasibility studies. Wang said that
he has spoken with Chinese state-owned banks but would not say
whether any would provide financing.
"I want to point out that it isn't going to take $50 billion
in cash to do this," Wang said.
Wang's other big infrastructure project, a $3 billion plan
to build a deepwater port on the Black Sea about 60 km (35
miles) north of Sevastopol, is facing greater uncertainty.
In December, Wang announced the agreement between HKND and
an unknown Ukrainian firm during a visit to Beijing by Ukrainian
President Viktor Yanukovich, who was ousted two months later.
. A photograph captures Wang at the time talking
about the port project with Yanukovich and China's Vice Premier
Ma Kai. The port site is located in the middle of the Crimean
peninsula that has been annexed by Russia.
By February, 20 HKND workers had completed their site
inspection work and were forced to return to China.
"We're still confident, but given the current complexity of
the Ukraine situation, in terms of our procedures, our schedule
and our rhythm, we will need to replan," Wang said.
"I'M VERY ORDINARY"
Wang looks flush with cash - at least on paper. His main
asset is a 36.97 percent stake in Beijing Xinwei, the
government-backed developer of China's wireless communications
standard that now specializes in mobile network development and
products. Beijing Xinwei in March estimated its assets at 26.89
Separately, Wang controls Hong Kong Nicaragua Development
Co, a Hong Kong registered firm, through mainland-registered
Beijing Interoceanic Canal Investment Management Co, according
to filings with the Shanghai Stock Exchange and Hong Kong
Wang also reports full ownership of several offshore
subsidiaries, including seven Netherlands firms related to the
Nicaragua project; a British Virgin Islands-registered aircraft
investment company, and media and sports entities, all of which
were registered within the last year.
He owns Southeast Asia (Cambodia) Agriculture Development
Group Inc, which was registered in Cambodia in September 2009,
according to Shanghai Stock Exchange filings.
Less is known about Wang's path to success. The youthful
chief executive refused to discuss his family background, saying
only that his father was an ordinary office worker and died in
2010 following an 11-year illness; his mother, who is about 70
years old, is retired; and that he has a daughter.
"It's that simple," said Wang. "I'm very ordinary."
Wang says he studied at Jiangxi University of Traditional
Chinese Medicine but left before graduation, returning years
later to organise Beijing Changping Traditional Health and
In the late 1990s, Wang said he travelled to Hong Kong to
learn about international finance and investment. He returned to
Beijing in 1998 and founded Dingfu Investment Consulting Co. In
Hong Kong, Wang also established Hong Kong Divine (Dingfu)
Investment Group Ltd in 2001.
He later mined gold and precious stones in Cambodia - a
process he described as slow and exacerbated by the legacy of
past wars - and opened Yingxi Construction and Engineering Co, a
small contractor that participated in projects in Beijing,
Tianjin and Guangdong. Available information about these firms
Wang declined to elaborate on the source of his wealth.
"China has an expression 'the finest fragments of fox fur, sewn
together, will make a robe', the meaning of which is a fortune
is accumulated over time," he said.
($1 = 6.2056 Chinese Yuan)
(Additional reporting by Ivan Castro in Managua; Editing by
Emily Kaiser and Alex Richardson)