Welcome to the Panama Weekly News Roundup! This week we talk about the efforts of companies outside Panama to be ready for the opening of the Canal Expansion, Panama’s development of local ports, the reasons for not expanding the Colon Free Zone just yet, and why Panama is still leading regional growth. We
Ports and Shipping Companies Retool Before Panama Canal Expansion
Huge things are expected of the Panama Canal expansion, with shipping companies looking to add more lines in their Pacifici-Atlantic routes following the completion of the mega project. Nonetheless, some of the grandest retooling will be from ports in the Caribbean gulf and on the Pacific shores of South and North America, with wider, deeper, and much larger ports being developed. Alongside the huge infrastructure needs required to supply and run these ports, they point to an economic future for both hemispheres which is increasingly tied into the Republic of Panama.
“The world’s biggest ports are dredging deeper and shipping companies are building even more mammoth container vessels as a European consortium undertakes a major engineering challenge—a multibillion-dollar widening of the Panama Canal.
The massive global endeavor comes even as an acrimonious battle between Panama and the builders over $1.6 billion in cost overruns continues.Negotiators say they are hopeful of a settlement as soon as Tuesday. Still, even if resolved, the dispute has bought into focus the costs that companies and cities could incur—as well as the difficulties of altering long-range plans—if more problems arise in a devilishly complex project that has already been delayed by more than a year.
Miami is spending hundreds of millions of dollars to deepen its harbor and build an underwater tunnel for trucks carrying goods for bigger ships that would use the new canal. The shipping publication, Alphaliner, said 214 of the so-called neo-Panamax ships, as long as four football fields and 161 feet wide, were ordered with sights set on a wider, deeper canal. The booming liquefied natural gas industry in the U.S., which is counting huge ships transporting gas to energy-hungry Asia, has predicated investments on large volumes passing through the canal.
Even citrus growers in Florida are seeking to get their products to Asia and the Pacific coast of Latin America on bigger ships at lower cost, by using a refurbished canal, said Adam Putnam , Florida’s Commissioner of Agriculture.”
Source: Carbon Positive
Panama to Lead Regional Growth in Report from SIECA
Regional experts predict that the economy of Panama will grow by 6.9 percent by late 2014, thanks to increasingly stable and diverse economic development. With the increased level of investment still growing, many analysts are promoting the country as a shining example of progress in the region. Currently leaving behind rivals such as Nicaragua, the republic is reaping the rewards of a booming trade, banking, services, and shipping-based economy.
“In its report “Economic Outlook for Central America in 2014″, SIECA predicts 3.9 percent growth for the region and stable economic development until 2015, when imports from advanced economies are expected to increase and continue to rise considerably over the next two years.
“The economic outlook for Central America in 2014 indicates the beginning of a period of transition, in which, the advanced economies will gradually show a recovery in economic activity, capitalizing on the dynamism of international trade,” the report states.”
Source: The Panama Digest
What Would Happen if the Canal Expansion Was Delayed?
Panama’s prudent and conservative attitude towards overstepping its development is once again on show, with the decision by the Colon Free Zone to avoid investments or expansions before the Canal Expansion is a proven success. This reluctance is in stark contrast to the rapid investment and infrastructure development in U.S. ports and Free Zones such as PortMiami, where huge projects are being implemented based on the assumed future success of the expansion. Will this potentially slow the growth of the Colon Free Zone in 2015?
“If the third set of locks begins operations in 2016, the Canal could lose part of its volume to the Suez Canal and the U.S. intermodal service.
On April 2013, Maersk line stopped using the canal for one of it its Asia to U.S. East Coast service. The service had 10 Panamax ships with a capacity between 4500 and 5100 TEU. Cargo now moves through the Suez Canal, in order to benefit from economies of scales.
Willys Del Valle, president of the Panama Maritime Chamber, stated that if the Panama Canal expansion is delayed, Panama could lose some volume of cargo to Suez and U.S.’s intermodal service, however, he believes that several services currently going through the Panama Canal will be maintained.Surse Pierpoint, Colon Free Zone Users Association ex-president, confirmed that the free zone has made no investments related to the Panama Canal expansion.”
Source: Panama Logistic News
Proposed Multi-purpose Port in Colon Province Meets Future Demand
Located in Largo Ramo, part of Colon province and near the Free Trade Zone and Panama Canal opening in the Atlantic, a new mega port has risen to match the ongoing needs of Panama’s shipping trade through an expanded canal. In a Post-Panamax age the “Atlantic Panama Green Port” or “Puerto Verde” will cost almost $8 billion dollars, serving as a useful point of departure for cargo as well as a fuelling station for vessels passing through the Panama Canal. Alongside this the port is expected to be able to work with super Post-Panamax class vessels, helping to widen its appeal for North – South conveyance of goods.
“The construction of a mega-port on the island Long Branch, village of Cristobal Colon province, have to fret about the negative environmental impact that could result. This is the project called Atlantic Panama Puerto Verde, whose development will be in the amount of $ 7.972 million. The promoter is Linden Partners, a Spanish company.
Details of the work are reflected in an environmental impact assessment (EIA) category III introduced in late 2013 for the National Environmental Authority (ANAM), in order to determine the viability of the structure in Columbus. The document mentions that marine terminal main objective would meet future demand for shipping services and fuel supply post-Panamax boats that pass through the Canal, once expanded, as well as serving as an additional docking port for larger vessels dimension that does not pass through the waterway. That is called super post-Panamax.”
Guide to Panama’s New Metro 2014
Panama’s new Metro service will launch in early 2014, as part of the extensive infrastructure improvements made since 2009. The huge development will see Central America’s first ever metro bisecting the capital city, with an initial capacity of 15,000 passengers per hour – rising up to a colossal 40,000 commuters per hour.
“The 15 stations will be spread across a range of levels, from a surface-level station at Albrook bus terminal to underground and elevated stops along the rest of the line. The majority of Underground stations in the center of the city will be subterranean, to allow the existing transport infrastructure relatively uninterrupted space to expand for the future. Running East-West through the city, the stations begin at Los Andes (a suburb of Panama), passes through the town of San Miguelito, enters the heart of the city at Via Argentina, before running all the way to Albrook mall via 5 De Mayo.
This route is the first route of 4, with a minimum of 2 lines already financially committed to. These will nearly all originate in Albrook, but bisect the city at different locations, helping to maintain the transport network’s efficiency and break the stranglehold of road transport.”
Continue reading about Panama’s new metro
