Panama Canal expansion fuels inter-oceanic race

The $5.25 billion expansion of the Panama Canal—the strategic waterway that now handles 14,000 vessels a year, or 5% of world trade—will be ready for commercial shipping later than originally planned, the Panama Canal Authority admitted Jan. 17. Widening and deepening of the 80-kilometer passage will be completed by June 2015, six months later than first intended, the Authority’s administrator Jorge Luis Quijano said (Bloomberg, Jan. 17) The expanded canal will be able to handle so-called "post-Panamax" scale ships, which are the length of aircraft carriers. The US Army Corps of Engineers estimates that US ports such as Miami are now spending up to $8 billion a year in federal, local and private money to modernize in response to the canal expansion, which experts call a "game changer."  CSX is planning to build a new $90 million rail transfer facility at Baltimore that will allow  cargo trains to be loaded a few miles from the port, while the Norfolk Southern line is blasting through Appalachian passes in West Virginia and Kentucky to allow expanded freight shipments. (Memphis Commercial Appeal, Jan. 14)

Meanwhile, a race appears to be on to estabish a Nicaraguan inter-oceanic route. The Nicaraguan government and a newly formed company run by a Chinese telecom mogul in September signed a memorandum of understanding that commits Hong Kong-based HK Nicaragua Canal Development Investment Co. Ltd. to build and finance the "Great Canal of Nicaragua," according to a statement released by investment promotion group ProNicaragua. The project is to consist of both a waterway and a parallel "dry canal" of highway and rail lines. A deep-water port is slated for Monkey Point, on the southern Caribbean coast, with the Pacific terminus to be at Puerto Corinto. The new company is headed by Wang Jing, president of Xinwei Telecom Enterprise Group, which handles much of China's wireless communications. (Nicaragua Dispatch, Sept. 11)

President Daniel Ortega pledges that revenue from the canal "will lift the country out of poverty." Last year, the Panama Canal brought in more than $1 billion, and Ortega says he expects a future Nicaragua canal to generate similar revenue. Ortega's one-time nemesis Edén Pastora is the government's pointman for the project—officially minister of development for the Río San Juan Basin since 2010—and he is dismissive of opposition. Pastora told the daily La Prensa: "There is a selfish attitude in those who oppose the canal project, because they only think of political competition. When the canal becomes a reality, the government will undoubtedly gain prestige. But the biggest gains will be made by the people."

Pastora is receiving a monthly government salary of $80,000, but has joked