Chinese businessman behind $51b Nicaragua canal denies special ties

BEIJING (REUTERS) - The mysterious Chinese businessman behind a US$40 billion (S$51 billion) plan to build a canal through Nicaragua pledged transparency on Tuesday - but refused to reveal where he attended college.

Mr Wang Jing, 40, who says his initial wealth came from a gold mine investment in Cambodia, is the only public face for a project that on paper would challenge the Panama Canal's monopoly on transporting oil, ore and containers between Atlantic and Gulf of Mexico ports and Asian markets.

Nicaragua's Congress last week granted Mr Wang's Cayman Islands-registered HKND company a 50-year concession to develop the canal, following a September agreement with president Daniel Ortega. HKND in turn is a unit of HK Nicaragua Canal Development Investment Co Ltd, a firm Mr Wang had registered in Hong Kong just a month before the deal with Ortega.

Mr Wang denied any family connection to the Chinese government, military or ruling Communist Party. Connections, or guanxi, are often the hidden ingredient behind sudden success in China.

"I always hoped people would pay attention to the project and not to me personally," he told a news conference at a luxury hotel in central Beijing.

"I am a very normal Chinese citizen. I couldn't be more normal."

The plan - which has generated a lot of scepticism from industry experts - is to build a 286km canal connecting the Caribbean with the Pacific via Lake Nicaragua, Central America's largest freshwater lake.

It would cost about four years' worth of Nicaragua's annual gross domestic product, and would likely be three times longer than the Panama Canal, which took a decade to build.

Speaking later in an interview with Reuters, Mr Wang said HKND would head a consortium of partners that would operate "fairly, impartially and openly" and might include international firms.

It would be financed by large Chinese and international banks that he declined to name, although he said financing negotiations were going smoothly.

A likely partner is China Railway Construction, one of the country's largest state-owned infrastructure developers, according to HKND materials promoting the project.

Another of Mr Wang's companies, the unlisted Xinwei Telecom Enterprise Group, signed a cooperation accord with China Railway earlier this year.

On one point, Mr Wang was explicit - he would maintain at least a 5 per cent stake in HKND, and he would remain in charge. He owns 100 per cent of HKND.

"Any future partners or consortium will respect my views and opinions very much," he said.

Mr Wang projected annual shipping revenues of US$5.5 billion when the canal is at full capacity. The deal calls for construction to be completed in five years, but contains no penalties for delay. Once constructed, ownership of the concession would gradually return to Nicaragua.

The tall, round-faced Mr Wang was unknown when he privatised loss-making state-owned Xinwei in 2010 and transformed it.

Xinwei booked over 2 billion yuan (S$416 million) in profits last year, Chinese media reported, mostly building wireless networks in other countries.

Xinwei's website carries photographs of Mr Xi Jinping, now China's president, and Mr Li Keqiang, now premier, visiting Xinwei.

Mr Wang told journalists he studied traditional Chinese medicine, but added it was "inconvenient" to say at which university. He then took an interest in mining in Southeast Asia, including the Cambodian gold mine, he said.

Mr Wang said he lived in his native Beijing with his mother, younger brother and daughter. Corporate records show a hotel management company registered to Mr Wang and his brother, Mr Wang Peng, as well as other small entertainment and telecommunications companies under their names.

Reuters was not able to locate the hotel management company at its registered address.

Mr Wang's nearly 40 per cent stake in Xinwei is worth about US$1 billion, based on the asking price for a minority share in the firm currently on sale by state-owned Datang Telecommunications.