Iran takes interest in Nicaragua project

Malcolm Latarche
Malcolm Latarche

26 August 2016


Following the ending of sanctions earlier this year, Iran is beginning to influence shipping developments in several areas. In attempting to recover its position in oil production, Iran has so far refused to play ball in freezing the OPEC output and has therefore contributed to keeping oil prices lower than might otherwise have been the case. More recently it has been in negotiations with Russia over new pipeline possibilities to take oil from Russia and ex-soviet republics through Iran. It has also been keen to rebuild and modernise its fleet with orders worth over $2.4bn made in early summer for a mixed bag of product carriers and 14,500teu boxships. Late last year it was intimated that IRISL would be placing orders for around 600,000teu capacity including 18,000teu ships but these seem not to have materialised as yet. Now Iran is looking to take a stake in the Nicaragua Canal project following a recent visit to the Central American state by Mohammed Javad Zarif, the Iranian foreign minister. Progress on the project which is strongly supported by Chinese interests appears to have slowed although surveys and reports are still produced at regular intervals with the involvement of UK-based BMT ARGOSS. While it is obvious to see the benefits for Iran in most of their actions, support for the Nicaraguan Canal would not appear to give many advantages beyond commercial contracts for Iranian construction companies. It would however revive memories of 1980s politics with both Iran and Nicaraguan president Daniel Ortega having little love for the US. The current plans for the Nicaraguan Canal would allow ships much larger than those using the expanded Panama canal to pass between the Atlantic and Pacific Oceans.