U.S. Embassy in Nicaragua voices concerns over Chinese-led canal

MANAGUA (Reuters) - The U.S. Embassy in Nicaragua said on Tuesday it was concerned by a lack of information surrounding the planned $50 billion, Chinese-led canal that would bisect the poor Central American nation.

Work began in late December on the 172-mile (278-km) waterway, which its Hong Kong-based developer HK Nicaragua Canal Development Investment Co Ltd (HKND Group) says will be operational by 2020, but so far it has been met with widespread skepticism.

HKND Group is controlled by a little-known Chinese mogul, Wang Jing, who said the Chinese government is not behind the project. But his reluctance to reveal his financiers has led many to speculate he enjoys Beijing’s tacit backing.

China’s Foreign Ministry spokesman Hong Lei told a regular press briefing on Wednesday that the government requires Chinese firms to abide by local laws when operating abroad, but dismissed any connection to the canal project.

“This project is the action of the relevant company’s own initiative. The Chinese government has not been involved,” Hong said.

China’s involvement would be a direct challenge to the Panama Canal, which was controlled by the United States until 1999. The canal would also give China a major foothold in Central America, a region long dominated by the United States. The U.S. embassy in Nicaragua declined comment when work began last month.

But in a statement released on Tuesday, the U.S. mission in Managua said all relevant documents pertaining to the project should be made public, and that the voices of all stakeholders should be heard in a peaceful manner.

“The embassy is worried by the lack of information and transparency that has existed, and continues to exist, over many of the important aspects of this project,” it said. It urged disclosure of environment studies, tenders and other details of the project.

Just days after the ground-breaking, at least 21 people were injured in clashes between police and protesters opposed to the construction of the canal.

Reporting by Ivan Castro; Additional reporting by Michael Martina in Beijing; Writing by Gabriel Stargardter; Editing by Ken Wills and Jeremy Laurence