Nicaragua Canal - History

History

The idea of building a canal through Central America is a very old one. The colonial administration of New Spain conducted preliminary surveys. The routes usually suggested ran across Nicaragua, Panama, or the Isthmus of Tehuantepec in Mexico.

In 1825 the newly established Federal Republic of Central America considered the canal. That year the Central American federal government hired surveyors to chart the route and contacted the government of the United States to seek financing and the engineering technology needed for building the canal, to the great advantage of both nations. A survey from the 1830s stated that the canal would be 278 km (172.7 mi) long and would generally follow the San Juan River from the Atlantic to Lake Nicaragua, then go through a series of locks and tunnels from the lake to the Pacific.

While officials in Washington, D.C. thought the project had merit, and Secretary of State Henry Clay formally presented it to the Congress of the United States in 1826, the plan was not approved. The US was worried about the poverty and political instability of Nicaragua, as well as the rival strategic and economic interests of the British government, which controlled both British Honduras (later Belize) and the Mosquito Coast.

On August 26, 1849, the Nicaraguan government signed a contract with the U.S. businessman Cornelius Vanderbilt. It granted his Accessory Transit Company the exclusive right to build a canal within 12 years and gave the same company sole administration of a temporary trade route in which the overland crossing through the Rivas isthmus was done by train and stagecoach. The temporary route operated successfully, quickly becoming one of the main avenues of trade between New York City and San Francisco. Civil war in Nicaragua and an invasion by filibuster William Walker intervened to prevent the canal from being completed.

Continued interest in the route was an important factor in the negotiation of the Clayton-Bulwer Treaty of 1850. The canal idea was discussed seriously by businessmen and governments throughout the 19th century. In 1897, the United States' Nicaraguan Canal Commission proposed this idea, as did the subsequent Isthmian Canal Commission in 1899. However, the commission also recommended that the French work on the Panama Canal should be taken over if it could be purchased for no more than $40,000,000. Since the French effort was in disarray, the U.S. was able to make the purchase at its price.

The Nicaraguan Canal Commission carried out the most thorough hydrological survey yet of the San Juan river and its watershed, and in 1899 concluded that an interocean project was feasible at a total cost of US$138m. At the same time the Geological Society of America published the “Physiography and Geology of Region Adjacent to the Nicaragua Canal Route” in its Bulletin in May 1899 which stands to this day as one of the most detailed geological surveys of the San Juan river region.

In the late 19th century, the United States government negotiated with President José Santos Zelaya to lease the land to build a canal through Nicaragua. Luis Felipe Corea, the Nicaraguan minister in Washington, wrote to US Secretary of State John Hay expressing the Zelaya government's support for such a canal. The US signed the Sánchez-Merry Treaty with Nicaragua in case the negotiations for a canal through Colombia fell through, although the treaty was later rejected by John Hay. Before Corea completed a draft of the Nicaragua proposal, Congress was considering the Spooner Act, to authorize the Panama Canal. In addition to the promise of earlier completion of the Panama canal, opponents of the Nicaraguan canal cited the risk of volcanic activity at the Momotombo volcano. They favored construction of a canal through the isthmus of Panama.

According to Stephen Kinzer's 2006 book Overthrow, in 1898 the chief of the French Canal Syndicate (a group that owned large swathes of land across Panama), Philippe Bunau Varilla, hired William Nelson Cromwell to lobby the U.S. Congress for the Panama Canal. In 1902, taking advantage of a year with increased volcanic activity in the Caribbean, Cromwell planted a story in the New York Sun reporting that the Momotombo volcano had erupted and caused a series of seismic shocks. This caused concern about its possible effects on a Nicaraguan canal. Cromwell arranged for leaflets with the stamps featuring Momotombo to be sent to every Senator, as "proof" of the volcanic activity in Nicaragua. An eruption in Saint-Pierre, Martinique, which killed 30,000 people, persuaded most of the U.S. Congress to vote in favour of Panama, leaving only eight votes in favour of Nicaragua. The decision to build the Panama Canal passed by four votes. William Nelson Cromwell was paid $800,000 for his lobbying efforts.

At the start of the 20th century, Nicaraguan president José Santos Zelaya tried to arrange for Germany and Japan to finance the canal. Having settled on the Panama route, the US opposed this proposal.