Nicaragua's Canal

posted Jul 21, 2013, 7:01 PM by Peter Joseph Moons

Comments by Peter Joseph Moons, July 21, 2013

     Here are some thoughts on the latest iteration of the proposed Nicaraguan Canal.

     In terms of Adam Smith's market theory, competition is always beneficial. If another method exists to cross Central America, then the Panama Canal Authority will have the opportunity to see where they can compete in the shipping market more effectively. The Panama Canal can find ways to improve transit times and costs to shippers, and perhaps reduce expenditures through greater efficiencies. One wonders if the centuries old dream of a canal across northern Colombia – a dry/wet type canal – will now also be resurrected.

     Interesting is the idea that global shipping market has need for more routes to cross from the Pacific into the Atlantic. In this regard, two socio-technology factors come readily to mind. First, with the possible effect of '3-D Printing' already threatening cheap products from Asian manufactures, from plastics to clothes, there may be an actual decrease in shipping to some extent starting in ten years or less. Second, populations are dropping across the developed world; countries on the periphery are also seeking lower birth rates. Due to this factor, the desire for finished consumer goods may also drop in the aggregate, thereby also decreasing shipping volume

     Future posts on this topic will look at the effects on Nicaraguan society, people and communities in the path of the canal, and how previous large-scale construction projects by Chinese firms have fared in order to predict how this canal project may result.