Panama Canal Expansion Project
September 24-26, 2014
SLC Economic Development, Transportation & Cultural Affairs Committee Technical Tour

Panama Canal Expansion Project

A delegation of state transportation leaders from seven SLC member states, including Senator Bill Hightower, Alabama (member, Senate Transportation Committee); Representative George Moraitis, Florida (vice chair, House Finance and Tax Subcommittee); Senator Steve Gooch, Georgia (chair, Senate Transportation Committee); Representative Walt Leger, Louisiana (Speaker Pro Tem and member, House Transportation Committee); Senator Gary Stanislawski, Oklahoma (chair, Senate Transportation Committee); Representative Larry Phillips, Texas (chair, House Transportation Committee); and Senator David Marsden, Virginia (member, Senate Transportation Committee), recently traveled to Panama for high level briefings on the Panama Canal expansion project. The delegation agenda was designed to reinforce the need for Southern ports to continue essential infrastructure enhancements to accommodate the significantly larger vessels and expanded cargo volumes expected to arrive after the completion of the Panama Canal expansion. This was the third consecutive year that an SLC legislative delegation had travelled to Panama for briefings on the Canal expansion project.

For more than a decade, the SLC has focused on the critical role played by Southern ports, not only in the economic calculations of the Southern region but also the nation as a whole. The decision by the government of Panama to proceed with the $5.25 billion expansion project has been touted as one of the most transformative global transportation projects currently in progress. Upon completion in 2015/2016, the Panama Canal will facilitate an even greater flow of trade between Asia and the Americas and substantially impact the volume of trade reaching Gulf and Atlantic Coast ports in the United States. A number of SLC states are expected to be impacted directly by the increase in cargo and vessel traffic in the aftermath of the Panama Canal expansion. In 2013, total U.S. exports to Panama amounted to $10.6 billion; in the first six months of 2014, U.S. exports to Panama amounted to $5.2 billion.

The delegation’s scheduled meetings began with a series of briefings and a tour of the Panama Canal Authority. At the Miraflores Center, the delegation received a detailed briefing from Mr. Luis Ferreira, Chief Engineer at the Panama Canal Authority on the expansion effort and its critical importance in the effective and efficient transfer of cargo between Asia and the Americas. Officials with the Panama Canal Authority elaborated on the role of the Canal’s expansion in the context of surging global trade and the contemporary shipping industry trend of deploying substantially larger vessels to take advantage of economies of scale. Also included on the technical tour was a visit to and further briefings on the operation of the control tower of the current locks. The SLC legislators then traveled to the site of the new Pacific locks for additional briefings on security procedures, equipment and finally, a drive through the Pacific lock, the journey that container and other seagoing vessels will be taking upon the project’s completion.

The SLC delegation then visited the U.S. Embassy in Panama for a briefing on U.S. – Panama political, economic and social linkages, which included reference to the impact of the expansion of the Panama Canal and the Free Trade Agreement (FTA) between the United States and Panama that was signed into law in October 2011. The briefing included an extended discussion with the U.S. Ambassador to Panama, Mr. Jonathan D. Farrar. Ms. Mimi Lu, Economic Officer at the U.S. Embassy in Panama also participated in this briefing. Finally, the delegation visited the American Chamber of Commerce and Industry in Panama (AmCham Panama) for briefings and dialogue on the potential for expanding the economic and financial relationships between Panama and corporate and business interests in the SLC states. Providing details on these topics to the SLC delegation were Mr. C.E. Maurice Belanger, Executive Director, AmCham Panama, Ms. Pilar V. Cerón, Trade and Investment Director, AmCham Panama and Mr. Robert St. John and Ms. Amanda Barraza de Wong, the 2014 Secretary and Director of AmCham Panama, respectively.