Nicaragua Sold its Sovereignty to a Chinese Man in a Suit

China’s ever-growing presence in Latin America, specifically in Nicaragua, has made the Central American country a playground for the Asian superpower. On July 2014, the National Assembly, composed mainly of Sandinistas, Nicaragua’s ruling party, rubber stamped a law granting a 50-year concession, renewable up to 100 years to the HKND Chinese Group with rights to build an interoceanic canal.  They specifically granted, “The sole rights to the Hong Kong Nicaraguan Canal Development Group (HKND) to plan, design, construct and thereafter to operate and manage the Nicaraguan Grand Canal and other related projects.” In other words, the former “revolutionaries” of Nicaragua sold their country to a Chinese man in a business suit.

It seems that the Sandinistas never learned about the East India Company, since they had no problem granting the Chinese firm unrestricted rights of natural resources exploitation and ownership for 116 years, which is in itself a violation of Nicaragua’s sovereignty and constitution. So much for the revolutionary cries against imperialism, since according to contemporary Sandinista logic, foreign control is okay as long as it is a company doing the deed.

Earlier this year, at a hearing before the Inter-American Commission on Human Rights, activists were given a platform to officiate complaints about the serious human rights infringements the inter-oceanic canal is having in Nicaragua. The Commission recommended a national referendum on the construction of the canal, yet there has been no transparency or national consensus on the project. More disturbing is the fact that, as a blatant disregard to the project, the operation rests on shaky legal ground and lawyers have produced 32 charges of unconstitutionality against it.

Many have argued the supposed economic benefits of the canal. The Nicaraguan Canal is believed to be significantly beneficial to international trade, and the Nicaraguan government has stated it considers the canal a game charger that will transform Nicaragua from the poorest country in the region into the third-fastest growing economy in the world over. However, the potential economic benefits are upstaged by the negative social, environmental and humanitarian impact the building of the canal is also generating. To the alarm of many economists the building of the canal requires the Central Bank of Nicaragua to waive its right to sovereign immunity by giving the HKND group unfettered and tax-free rights over the Managua Lake and surrounding lands. Additionally, the government is expropriating land along the route of the canal with little to zero remunerations, which has led to the forced displacement of more than 100,000 people, setting the stage for widespread homelessness and extreme poverty.

The Managua Lake through which the canal will cut through is a public good and through this they have illegally privatized a national heritage. The huge environmental consequences and the lack of access to the lake (which is a source of livelihood to many) that the canal will cause were not taken into consideration. In fact, the construction of the canal was approved without having done any prior feasibility and environmental studies. The canal concession is thus an assault on territorial rights, and the indigenous population in Nicaragua are seeing their source of clean drinking water threatened and their lands expropriated. This in itself is a violation of Article 26 (3) of The United Nations Declaration on the Rights of Indigenous Peoples, which requires the State to give legal recognition and protection of land, territories and resources as well as Article 27, requiring States to establish and implement a process recognizing and adjudicating indigenous peoples’ rights in relation to their lands, territories and resources.

The project has also generated acts of police intimidation and government reprehension. Throughout the month of March, there were a total of 40 demonstrations against the canal. In an attempt to silence the opposition the government sentenced a military official,  Yader Montiel Meza, to three months in prison for making a comment against the forced displacement of the population.  Montiel “ the canal was stained with the blood of our brothers who are fighting for their rights” and that it reminded him of the red Christmas” and “…it seemed like Nicaragua had gone back in time to the 80’s.”  Furthermore, businessman Milton Arcia, who opposes the government, was beaten and had his hotel demolished by the government during Easter Friday. Bishop Abelardo of the Episcopal Conference of Nicaragua spoke out stating the case was an obvious case of expropriation and physical aggression and that the government is seeking to instill a state of terror. “ We have said it before. The government is trying to instill a state of terror, where one man has all the power in his hands. It is a shame that in a country that calls itself democratic we have to endure situations like these.  This is a pseudo reign where one man decides and has all the power.” Many Nicaraguan bishops and clergy have expressed their concern about the future of those who have been displaced and are weary of the tensions inside the country.

On October 2015 massive protests were staged against the Interoceanic canal, with posters deeming Nicaragua’s President Ortega a “vende patria” (a sellout) a traitor to his country. The protestors kept denouncing that the dictatorial government is imposing the canal on the country.  These protestors see their source of clean drinking water threatened and their lands expropriated.  In an attempt to crack down on the protest, the government cut down all communication lines and denied public transportation to mobilize the protestors.  However, inhabitants of many communities affected by the Mega Canal Project walked over 3 hours to arrive to the capital city and protest. They overcame threats and obstacles set by the Sandinista police in order to be able to voice their complaints against the expropriation of their lands by a foreign company. What is at stake is not only the land of these communities but their economic, human and environmental resources. By not allowing protestors to manifest, Ortega is repressing not only the right to freedom of speech but the right of many communities to a dignified life.

It is important to note that protestors are not necessarily entirely against the canal but against how the construction is being handled. The construction of the canal would be more favorable if the canal were to remain under Nicaraguan authority, proper environmental studies were conducted, that would lessen the negative impact to the environment, Nicaragua had the proper infrastructure to build it and if proper compensation and remuneration were given to those displaced. However, given that that is not the case; the economic benefits of the canal are not enough to overlook the considerable amount of variables such as the destruction of the environment, the displacement of the population, the human rights violations and the lack of feasibility of the project.

The negative impact on Nicaragua’s ecosystems and rich natural resources the canal will create will be catastrophic, therefore Nicaragua has a case to plea article XX of the General Agreement on Tariffs and Trade (GATT) of the World Trade Organization stating that environmental rights can sometimes supersede economic gains when the environment is threatened. Additionally in regards to the displacement of the indigenous population the Nicaraguan government should adhere to the United Nations declaration on the rights of the indigenous people as well as Nicaraguan law 445 which demands the demarcation and titling of all indigenous land as well as guarantees the full recognition of communal property ownership rights, recognizing the rights of such communities to use, administer and manage their traditional land.

The increase in protest in Nicaragua this year demonstrate the uneasiness and displeasure of Nicaraguan towards Ortega. Nicaraguans are no longer apathetic to Ortega; the growing acceptance of Ortega’s demands by the populace that once allowed the President to tighten his grip on the country no longer exist.  The catalyst of such an event has been the systematic increase in nationalism and patriotism, with Nicaraguans adamant that the judicial, fiscal, financial rights and sovereignty of Nicaragua are being given to the HKND by a president deemed unconstitutional, a president whose illegality is persistent. A president who places a price tag on his country.

Author Biography

Valeria Gomez Palacios is a native of Nicaragua with a Bachelors degree in Diplomacy and International Relations and Modern Languages from Seton Hall University. Fluent in German, French, Spanish and Italian, Valeria volunteers as an independent translator for various NGOs and has experience serving in nonprofit and governmental organizations including: the United Nations offices in Vienna, the Nicaraguan Foreign Ministry and the European Union Delegation to Nicaragua, Costa Rica and Panama where she contributed to the efforts of the E.U to promote rule of law and sustainable development. Her current research interests lie in human rights law, conflict resolution and peace and security.

Cover image ‘IMG_2089‘ by Jorge Mejía peralta