Hundreds of farmers Tuesday demonstrated against a new $50 billion waterway aimed at rivalling the Panama Canal, irate at plans to expropriate the land they work.

"We do not want the canal to be built. Nobody should come in here and take over our land," said Ronald Enriquez at a march in the southern town of Potosi, where participants scuffled with police.

The mega-project through Nicaragua -- which would link the Caribbean and the Pacific -- has been assigned to a Chinese company, HK Nicaragua Development (HKND).

Demonstrators chanted "We do not want the Chinese here," and "the police are on the side of the Chinese," at the second such show of opposition in the Rivas department (province) in less than a week.

The Great Inter-Oceanic Canal Commission, which is managing the project, said it would pay fair prices to landowners whose property is taken for public use.

Work on the 278-kilometer (172 mile) waterway is scheduled to begin late this year.

President Daniel Ortega has said the project will create enough work to help alleviate the poverty that affects more than half the population of this Central American country.

But environmentalists are worried, in particular about the effects of ship traffic on a lake that is along the path of the planned canal. Lake Cocibolca is the largest freshwater body in Central America.

Panama earns about $1 billion annually from its canal.