A deeper canal holds promise
Tampa's port director, who worked in Panama, says a new set of locks could bring more container traffic here from Asia.
By DAVID ADAMS
Published May 2, 2006
It's a sure sign of the times when one of the world's modern marvels of engineering becomes outdated.
For almost a century the Panama Canal has operated as one of the most important waterways in global trade, linking the Pacific and the Atlantic.
Last week the government of Panama announced an ambitious $5-billion plan to increase the capacity of the canal by building a new set of larger locks, capable of handling a new generation of mega-sized container ships.
"The world has changed. The market for container trade is so much bigger," said Tampa Port director Richard Wainio.
An expanded canal could have a major effect on global trade patterns, Wainio predicted, including potential new clients for the Port of Tampa, which recently invested in a $45-million container terminal.
Few know the canal better than Wainio, who worked there for 23 years when it was a U.S. government operation. His ties to Panama go back three generations. His grandfather emigrated from Finland and arrived in Panama via Ellis Island in 1912 to work as a "mud digger" during the final stages of canal construction.
Before the canal reverted to Panamanian control in December 1999, Wainio held a senior planning post heading studies of the waterway's role in future world trade. At the time, he was one of a number of cautious voices who worried that the enormous cost of widening the canal would outweigh its cost-effectiveness.
Wainio and many of his fellow U.S. canal bosses -- known as the "pana-gringos'' - had a more conservative goal.
"Our priority was to ensure that the canal was turned over to Panama in good working order," he said.
Studies indicated that a trend to build more big ships - known as "Panamax,'' designed to fit the canal's locks with only inches to spare - would eventually surpass the canal's capacity. Experts estimated the canal would handle shipping demand at least until 2010.
But the explosion of Asian trade, and the economic boom in China, overtook expectations. Soon shippers were talking of even bigger "post-Panamax" vessels, unable to navigate the canal.
"We knew the post-Panamax ships were coming. I didn't think it would happen so rapidly," Wainio said.
Panamax ships can carry about 4,500 containers. The new super-containers will hold up to 10,000.
Canal officials say the waterway is running at 94 percent capacity, resulting in long bottlenecks of ships at each entrance whenever lanes are closed because of maintenance work.
Built by U.S. engineers and opened in 1914, the canal uses a series of step locks 108 feet wide to move ships from the Atlantic to the Pacific on a 50-mile route that rises to 105 feet above sea level at its highest.
The expansion plan requires deepening the canal by almost 4 feet, and the construction of two huge three-step locks at either end to accommodate the bigger ships. Part of the excavation for the planned locks was started by the Americans in 1939 but was halted by the outbreak of World War II.
Panama's government says the canal expansion will cost $5.25-billion, with work expected to take at least six years. Because of its enormous cost for such a small country of 2.8-million people, the government says it will not go ahead until a referendum is held this year. The idea appears to be popular among Panamanians, with recent opinion polls showing 55 percent in favor of expansion, and 19 percent against.
But some question the government figures.
"To make such an investment of such a magnitude, depending on future traffic projections, it involves a risk," said Fernando Manfredo, a highly respected former deputy canal director.
"Panama has a very fragile economy, and I don't think we should assume such a risk."
Manfredo worries that betting on China's continued boom is a dangerous gamble. He backs a rival plan to build megaports at each end of the canal, where big ships could unload their cargo onto smaller vessels able to navigate the waterway.
Now fully converted to the expansion viewpoint, Wainio points out that the canal does not have a monopoly on world trade. Two-thirds of Asian trade uses domestic U.S. rail links to access major East Coast markets.
"The real issue is how efficiently can they build it," he said. "Will it come in at $5.2-billion? They are really going to need good project management."
If the past six years are anything to go by, experts say Panama may surprise everyone. Contrary to the critics of the U.S. handover in 1999, Panama has drawn favorable reviews for how it has run the waterway.
Panama's success will be Tampa's gain, Wainio says. If the expanded canal succeeds in capturing a larger share of Asian trade, that will draw more trade into the Port of Tampa.
As a "pana-gringo,'' he says that will make him doubly happy.
David Adams can be contacted at email@example.com Information from the Associated Press was used in this story.
PANAMA CANAL HISTORY
- In the 1880s, French engineer Ferdinand de Lesseps, who built the sea-level Suez Canal, tried to build a similar waterway through Panama. The French abandoned their effort after 22,000 workers died of tropical disease and de Lesseps' company went bankrupt.
- The United States took over the project after creating a U.S. sovereign canal zone. Instead of copying de Lesseps' sea-level plan, U.S. engineers built dams and locks to create a stepped waterway. The 10-year project cost about $375-million.
- The official inaugural crossing was undertaken by the S.S. Ancon on Aug. 15, 1914.n During each crossing of a ship, 52-million gallons of freshwater are washed into the sea.n In 2005, 13,000 ships passed through, paying $1.2-billion to Panama in canal fees and for maintenance and other services.
- U.S. ships remain the primary users of the route, followed by South American countries as a group and China.n The canal shortens the voyage between New York City and San Francisco to less than 5,200 miles. Previously, ships had to travel around South America -- a distance of more than 13,000 miles.
Source: Times wires, World Book
[Last modified May 2, 2006, 06:47:02]
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