El Nuevo Diario: “The fall in oil prices has benefited the Canal”
Note: This article was published in El Nuevo Diario of Nicaragua on September 2nd, 2015. Pang Wai Kwok, the Executive Vice President of HKND Group, received the interview in Hong Kong. The journalist Carlos Solis from El Nuevo Diario addressed various topics such as the need for labor, the protection of Lake Nicaragua, the route of the Grand Interoceanic Canal of Nicaragua, the influence on the project by stock market volatility and the falling price of oil.
By: Carlos Solís
Kwok Wai Pang, senior officer of HKND says that the Chinese government is not behind the megaproject and confirms that it is unavoidable that the project passes through Lake Nicaragua.
The Executive Vice President of HKND Group, Kwok Wai Pang, says that they are working with the government of Nicaragua to obtain all the necessary permits for carrying out the work in 2016.
Kwok received El Nuevo Diario at the headquarters of the company HKND, in Hong Kong.
The office is located on the 18th floor of the International Finance Centre in Hong Kong, China, and has a stunning view of “Victoria Harbor", the only port in the world with natural deep water.
The Executive Vice President of HKND Group is fully responsible for all the logistics for the construction of the Interoceanic Canal of Nicaragua.
The official is a native of the area and dresses very simple. He does not speak Spanish but his English is perfect.
Before starting the interview, Kwok points with his index finger that the Nicaragua canal will be similar to the natural canal they have, which separates the Kowloon peninsula from Hong Kong Island.
Mr. Pang, how is the construction of the canal (of Nicaragua) going?
We have made lots of progress to build the canal. We are currently discussing with the government of Nicaragua about internal matters for the execution of this project, such as how to protect the rights of the Nicaraguans and the environment, etc. We're also working to have all permits approved to start the large-scale works by 2016, but for that purpose we must negotiate and that is what we are doing.
There is much concern among the population because the canal will pass through the Lake Nicaragua. What precautionary measures are you taking to prevent water contamination in the lake?
First, I want to say that ships do not pollute water unless they have an oil leak or unless an accident happens. There will not be any water contamination if these two factors do not exist. But let's say there is a problem in a ship and there is a chance of contamination. I am a specialist in operational security, and the first thing we would do is to mitigate the problem to the maximum. Furthermore, the canal will only pass through one end of the lake and pollution would be minimal due to the way in which the water runs. We are a company that is certified in risk operations at an international level. This means that we will be able to identify ships that are likely to have oil leaks before they pass through the canal.
In order to be at ease, I can guarantee you by 100 percent that the risk that a ship contaminates Lake Nicaragua is minimal. It is more likely to have problems with the ships here in "Victoria Harbour" than in Lake Nicaragua. The only way that the lake can be contaminated, which causes me great concern, is a terrorist attack. But if this happens, we are well prepared to mitigate this type of problems too.
You have already changed the canal route to avoid the town of El Tule. Is it possible to change the route again to avoid passing through Lake Nicaragua?
It is impossible. If you look at the map of Nicaragua, there is no way to avoid passing through the lake. If we talk about building the canal route along the San Juan River, we have to go through the lake. Unless we invest two or three times more to carry out a deeper excavation so that the canal pass through Managua or León, but this would mean affecting many more people and investing much more money.
HKND announced that the construction of the port in Brito will begin by the end of this year. How much will that port cost?
To be clear and to give you an idea of how much will be spent on the construction of the port in Brito, if all goes well in 2016, the final design of this port will have a capacity for three ships of 25,000 TEU containers (20-foot equivalent unit) docking at the same time. This means we have to create a supply chain for the major works. The first thing we need to do is to create a logistical system to bring fuel. To maintain the project in operation, 4.6 million liters of fuel is needed per day, which equals to the fuel consumption of one day for the whole of Nicaragua. Therefore, we must ensure that we have sufficient storage space, obtain the transportation, build roads, oil pipelines, and so on.
In addition, we must add that the Caribbean side does not have the infrastructure that exists in the Pacific side to facilitate the work. In short, we have to do everything. It is not as easy as many people think.
How many people are you planning to hire to initiate these works?
We are talking about an estimated number of 1,000 to 2,000 people.
In Nicaragua many people hope to get a job in the canal project, how many job opportunities could you offer in the next 12 months?
In the next 12 months we can employ 3000 people, but I do not want to create false expectations among the people of Nicaragua and I want to be very honest. The majority of people to be employed depend on who wins the tender to build the canal. I'll give you an example. If a Colombian company wins the tender, they will bring their own labor force, because it may be cheaper; if an American company wins the tender, then, they might employ Nicaraguan people because it can be more convenient for them. It all depends on who wins the tender. But I also want to stress that there will be many opportunities for the people of Nicaragua. It all depends on how competitive the Nicaraguans are.
Why do you undertake the geological surveys this year?
To be honest, we had already planned to conduct aerial survey last year, but we did not have a program that could send us accurate signals about the type of terrain where the canal will be built. It wasn't until we found a very good technology, known as PPP, that we started the aerial geological survey this year.
Let's talk about the financial problems that China is facing with the devaluation of its currency. How is HKND affected by the economic movements that occur in China, where the currency has been devalued and stock markets have fallen?
Personally, it has affected me a lot. I have lost a lot of money (laughs when he says it). But speaking of HKND, so far I have not seen any economic impact on our company. On the contrary, the fall in oil prices has benefited the project. We said initially that the canal could cost $ 40 billion, then $ 50 billion. Now I can ensure, taking into account the current international oil prices, the canal can be built with US $ 40 billion or US $ 45 billion.
Some people say that this canal is a dream and that it is not possible to build a canal in Nicaragua for various reasons. What do you want to say to all these comments?
I’d like to tell them that what they are saying is not true. The only way that the canal could not be built is that the people of Nicaragua become violent and cause terrorist attacks to destroy the project.
Is the government of China involved in the construction of the canal in Nicaragua?
Not that I know of and I want to make something very clear on this subject. The canal project is completely neutral and has nothing to do with politics. We are a completely independent company that welcomes international investors. To put it simple, one of the main participants of this project is Australian.
Have you invested a lot since the announcement of the construction of the canal in Nicaragua?
We have invested lots of money.
What message do you want to send to the people of Nicaragua?
The canal is not a dream, unless the people of Nicaragua do not want it. If you want to make it come true, we will build the canal. We've already committed to pay land and houses at a fair price. We are listening to the people. We have changed the route to avoid affecting many people. We understand your concerns, but we also want you to understand us. We are independent investors and we hope that the canal will always remain politically neutral.
We understand that you have political problems internally in Nicaragua; I ask people not to politicize the construction of the canal. It doesn't matter which party they belong to, whether they sympathise with the government or with the opposition. This is a project with a term of 100 or 200 years.
Governments will succeed each other, and this great work will remain there, to serve the people. This canal is for all the good people of Nicaragua.
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