Travel Reference
In-Depth Information
Ships pay according to their weight, with the average fee around US$30,000. The
highest fee was around US$376,000, paid in 2010 by the cruise ship
Norwegian Pearl;
the lowest was US$0.36, paid in 1928 by Richard Halliburton, who swam through.
The pre-expansion canal has three sets of double locks: Miraflores and Pedro Miguel
Locks on the Pacific side and Gatún Locks on the Atlantic side. Between the locks, ships
pass through a huge artificial lake, Lago Gatún, created by the Gatún Dam across the Río
Chagres, and the Gaillard Cut, a 14km cut through the rock and shale. The passage of
each ship releases a staggering 52 million gallons of fresh water into the ocean.
Panamanians voted to expand the canal in 2006. The US$5.25 billion plan will widen
and deepen existing navigation channels as well as enable the construction of two new
locks. Originally planned for inauguration at the canal's 100-year anniversary, it now
seems that the expansion will not open until 2015.
EXPANDING THE CANAL
Betting on growing international shipping needs, the Panama Canal is expanding.
One of the biggest transportation projects in the world, this US$5.25 billion mega-
project is slated to finish by 2015. New locks will be 60% wider and 40% longer.
Container traffic is expected to triple. But will it be able to meet increased world
shipping needs?
As container ships get bigger and bigger, the need to accommodate them is
plain. Proponents of the expansion expect the increased traffic and volume
through the canal to inject a huge boost into the Panamanian economy. The coun-
try will maintain its current role as the maritime logistics center in the Americas,
and everything from the Free Trade Zone of Colón to the international financial hub
of Panama City is likely to boom. It may even increase tourism, since the new locks
will be able to accommodate large cruise ships.
The rationale for the expansion is that the demands of the international mari-
time shipping community have changed. Although as much as 5% of the world's
total sea commerce traverses the Panama Canal, the Suez Canal in Egypt, which is
capable of handling larger vessels, serves more than 6%. Furthermore, the
Panama Canal is already operating at more than 90% of its maximum capacity and
will reach its saturation point in less than five years.
The biggest challenge the Panama Canal faces is luring the enormous post-
Panamax vessels, which currently depend on either the US Transcontinental Rail-
road or the Suez Canal. But those in favor of the canal expansion are hoping that
this lucrative market will adopt the Panama route, especially as trade volumes
between Asia and the continental east coast increase. There is concern that the ex-
pansion will not offset its construction costs. Furthermore, critics from all sectors
