The idea of constructing a manmade waterway through Central America is old. The routes suggested usually ran across Nicaragua,
Panama, or the
Isthmus of Tehuantepec in Mexico. The colonial administration of
New Spain conducted preliminary surveys as early as 1551, under the supervision of a Spanish explorer named Gormara. Nothing came of this initial attempt, but the idea was revived in 1781 by the Spanish Crown, and surveys were made again, this time under the supervision of an officer named Galisteo. Construction did not occur, as the crown was unable to secure adequate funding. In 1825, the newly established
Federal Republic of Central America (FRCA) considered the waterway. That year, the FRCA government authorities hired surveyors to chart the route and, afterward, contacted the
Federal government of the United States to seek financing and the engineering technology needed for building the shipping route, to the advantage of both nations. A survey from the 1830s stated that the waterway would be in length and would generally follow the San Juan River from the Caribbean Sea to Lake Nicaragua, then go through a series of locks and tunnels from the lake to the Pacific Ocean. 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 United States was particularly concerned with Nicaragua's relatively high levels of poverty and political instability, as well as the rival strategic and economic interests of the British government, which held
British Honduras (later
Belize) and had a
protectorate over
Mosquitia.
Early legal agreements On August 26, 1849, the Nicaraguan government signed a contract with the United States businessman
Cornelius Vanderbilt. It granted his
Accessory Transit Company the exclusive right to construct a waterway within 12 years and gave the same company sole administration of a temporary trade route in which the overland crossing through the isthmus of Rivas 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 1888, a bill was proposed in the
United States House of Representatives to incorporate a Nicaragua Canal company. In 1890, the American-owned Nicaragua Canal Construction Company held its third annual meeting, while brush was being cleared along the canal route. Many workers fell ill and were hospitalized due to tropical illnesses. In a letter sent to the Nicaragua Canal Board in 1895, Swiss geographer and nearby Costa Rica resident
Henri François Pittier warned that construction of the project would be difficult to carry out, as earthquakes and heavy rainfall were common in the country. Though Pittier did not believe earthquakes alone could hamper any future construction, In 1901, the US's
Isthmian Canal Commission of 1899 estimated that the cost of building a canal would be $189 million in Nicaragua versus $184 million—$144 million plus $40 million as a fair price to buy the French Panama Canal Company's incomplete work—in Panama. However, the commission recommended the Nicaragua route because the French Panama Canal Company demanded an "unreasonable" price of $109 million rather than $40 million for its incomplete work. After learning that the commission would recommend the Panama route to the US Congress if the price were reduced, in 1902 the French company agreed to sell for $40 million, causing Congress to settle on Panama rather than Nicaragua. In the late 19th century, the United States government negotiated with President
José Santos Zelaya to lease the land for the construction of a canal through Nicaragua. Luis Felipe Corea, the Nicaraguan minister in Washington, wrote to United States Secretary of State
John Hay expressing the Zelaya government's support for such a canal. The United States signed the
Sánchez–Merry Treaty with Nicaragua in case the negotiations for a canal through
Panama fell through, although the treaty was later rejected by John Hay.
Lobbying efforts against the Nicaragua Canal 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 the construction of a canal through the
Isthmus of Panama. Cromwell arranged for leaflets with stamps featuring Momotombo to be sent to every Senator as "proof" of the volcanic activity in Nicaragua. An eruption in May 1902 on the island of
Martinique resulted in
30,000 human fatalities. This catastrophe persuaded most of the United States Congress to vote in favor of constructing the canal in Panama, leaving only eight votes in favor of Nicaragua. The decision to build the Panama Canal passed by four votes. Cromwell was paid US$800,000 for his lobbying efforts. Nicaraguan president Zelaya later tried to arrange for Germany and Japan to finance the building of a canal that would traverse the
Zelaya Department in Nicaragua. Having settled on the Panama route, the United States opposed this proposal. ==After the Panama Canal (1910–1989)==