Panama's president is asking his citizens to approve a multibillion-dollar gamble on the future of the Panama Canal: a plan to refit the waterway to accommodate huge modern cargo ships that would entail the greatest modifications since the canal opened in 1914.
President Martin Torrijos was scheduled today to outline a plan to expand the canal for the large cargo ships that cannot fit through its 33-meter-wide locks, designed by US engineers about a century ago. He will need to get the plan approved in a national referendum later this year.
The project, backed by the Panama Canal Authority, would be a mammoth investment for a country whose annual budget is US$6.5 billion.
The government's determination to go ahead with the project is fuelled by fears that the new cargo ships which can carry twice as many containers as those that fit through the canal will seek other routes, reducing the importance of the Panama Canal and its income-generating capacity.
In 2005, 13,000 ship crossings left US$1.2 billion in Panamanian coffers for canal fees, maintenance and other related services.
The canal, 32 metres above sea level, uses a series of parallel locks or water chambers to lift ships to Lake Gatun for the 80-kilometre cruise from one ocean to the other. A third set of wider locks would allow the larger ships to get through. The additional locks would require a system that would save part of the water that is now dumped into the oceans as the ships are lowered or lifted. It would also require widening the canal basin fed by the Chagres River.
If approved, the project is expected to take at least six years.