HK Nicaragua Canal Development Investment Group (HKND), a Chinese infrastructure firm, announced Wednesday that it was delaying the construction of a $50 billion canal across Nicaragua to late 2016, but gave no reason for its decision, according to reports.
The Hong Kong-based developer had received approval to assess the environmental impact of the canal earlier this month. However, on Wednesday, the company said in a statement, according to the South China Morning Post: "The construction of locks and the big excavations will start toward the end of 2016."
Nicaraguan authorities have already approved the plans for the canal and building crews began construction for access roads last December but work on the waterway itself is yet to begin. "The canal's design is currently being fine-tuned,” the company said in the statement, without providing further details.
The proposed canal has drawn outrage among indigenous communities and farmers in the Latin American country who fear their lands will be seized for the project. Local communities and international observers have raised concerns over the paucity of details about the impact on environment, dubious promises of economic growth and the lack of clarity over its financing.
The 172-mile canal project, dubbed the largest ever human engineering endeavor, was being funded by Wang Jing, the CEO of HKND Group, the South China Morning Post reported.
The government granted the project to the HKND Group without opening up bidding to other companies, while Wang has declined to name investors backing the project, leading many to speculate that the Chinese government is financing it behind closed doors to gain a strategic foothold in Latin America.
The entrepreneur -- among the top 200 richest people in the world in June -- has hit a rough patch since the stock market slump in China. His net worth, estimated at $10.2 billion in June dwindled to only $1.1 billion in October, according to the Bloomberg Billionaires Index -- the sharpest drop recorded by the index, which provides a daily ranking of the world’s 400 richest people.