If you’re interested in the proposed Nicaragua Canal Project, you should be interested in China’s ‘ordinary billionaire behind Nicaragua Canal plan.
The interview is with Reuters so follow the link to get the rest of the story. But before yo ugo, ponder for a minute that the proposed cost of the canal is now flagged publicly as $50B. This is up from $40B quoted last year when the deal was struck between Nicaragua and HKND, the company slated to oversee the building of this monster.
Consider also that this is a 25% cost increase before any work has started and before the environmental impact assessment report has been published. That report is due if not overdue and I wonder what it will contain.
The cost ratchet is on par with Bengt Flyvbjerg’s general findings about mega project overruns although we should expect massive cost overruns on an ongoing basis once construction starts. This is because the underlying dynamic in large construction projects is to press bidders to submit the lowest possible bids, which nobody really believe to be realistic.Then the battle begins as the contractors start looking for opportunities to submit change orders. Read More …
Tagged with: Nicaragua Canal
Filed under: Uncategorized