Panama Canal expansion to create 240,000 jobs

The planned expansion of the Panama Canal, to be financed by users, is expected to create some 240,000 jobs, said the water-way deputy manager Manuel Benitez.

“The Treasury will not have to pay one nickel for the project” Benitez said, adding that the proposal set forth by the Panama Canal Authority (ACP) "does not call for the central government to take any type of debt to cover the financing" of the construction.

As to employment "we’re talking of possibly more than 240,000 additional jobs" including direct and indirect positions, the ACP official said.

Benitez said construction of the third set of locks foreseen in the project would begin within 18-24 months after approval of the expansion in the referendum. Panama plans to hold a referendum later this year on expansion of the canal.

Under the Panamanian Constitution, the decision to expand the interoceanic waterway can only be made by the people in a referendum.

Construction of the new locks is expected to take about five years and "we will have to raise tolls immediately" to provide the initial project financing, Benitez said. The new locks are needed to accommodate the larger ships now in operation around the world.

Panamax vessels which are 230 meters long, 32.2 meters wide and have a 70,000-ton capacity are the largest vessels that can pass through the flood gates of Gatun, Pedro Miguel and Miraflores, which have remained unchanged since the canal was built.

The Panama Canal, which the United States begun building in 1904 opened on August 15, 1914, with the passage of the U.S. steamship Ancon. The 80-kilometer water-way links the Pacific and Atlantic oceans and has been under Panamanian management since December 31, 1999, when the United States surrendered it under the terms of the 1977 Torrijos-Carter accords.

The canal which is a main source of income for Panama had revenues of 1.2 billion US dollars in 2005, with 489 million US dollars paid to the Panamanian treasury according to ACP.