On 8 July 2016 the British Chamber of Commerce Panama had the pleasure of attending a Forum titled “Expansion of the Panama Canal: Lessons Learned and a New Vision for the Country”. The event was organised by the Maritime University of Panama at the Ciudad de Saber Atheneum.
The purpose of the Forum was to make public a list of lessons learned during the nine years of the expansion mega-project, and how for future projects the Panama Canal Authority (ACP) should and will act when considering works of this magnitude. Additionally, economists and business executives gave their views on the positive impact the expanded Canal will have not only on the Panamanian economy, but on the global one as well.
The keynote presentation was given by Jorge Quijano, Administrator of the Panama Canal Authority, who gave a list of 20 points of the different components of the lifecycle of the project, and what lessons the ACP learned from it. He strongly emphasised the need to select consortia based on more criteria than just price, and how contracts with these companies should be detailed to the “point of being exaggerated”.
Another presentation was given by Guillermo Chapman, Jr., a well-respected Panamanian economist and partner at INDESA. He spoke about the future economic projections that the expanded Canal will bring to the country. Some key figures that he gave were that the project will give a 20% boost to the national GDP, which will translate to an extra $14,000 in GDP per capita. He also mentioned that the project will contribute more than $5.5 billion to the National Treasury. Finally, Mr. Chapman suggested that in order to take full advantage of the future business the ACP will generate, the hinterlands of the Canal should be taken advantage of to set up a mega processing and distribution centre.
A presentation was given by Ruben Lachman Varela, another well respected economist where he gave the following fundamental messages:
- The Inter-oceanic Canal Zone (ICZ) should be a launch point for growing the other economic sectors of Panama.
- There should be a new Plan of Land Use and Connectivity drafted for the whole country on the basis of the expanded Canal.
- The human capital needs in different economic areas should be quantified, with a particular emphasis on logistics and tourism.
- The Panamanian Government should draft Legal and Institutional Frameworks that take into account a modernised logistics sector.
- Ensure environmental sustainability of the areas around the Canal if economic activity will thrive there.
- Outline the socio-economic impacts that the activities around the expanded Panama Canal will have on the whole nation.
Finally, there was a panel discussion composed of Fanny de la Rosa from the Association of Panamanian Business Executives (APEDE) and Rommel Troetsch from the Maritime Chamber of Panama. There were three questions that were put forth to both of them:
- What should be the Government of Panama’s priority in the logistic and maritime sector?
- Rommel Troetsch: there has to be an improvement in the roads and land routes of the country for the efficient movement of cargo. Additionally, the Government should promote the investment of docks and supply services for ships. Finally, there should be a public-private commission tasked to develop and administer a comprehensive logistics plan.
- Fanny de la Rosa: there has to be a Logistics Law separate from the 2008 Maritime Law that gives a framework to the Government’s policies to all things related to the sector.
- How can the logistics platform benefit the whole country?
- Rommel Troetsch: the biggest benefit that should come from the logistics platform is the ease of agricultural and fisheries exports. However, the agriculture and fisheries industries are quite poor in the country. There should be a focus on what products Panama should specialise in and then commercialise them using the logistics platform.
- Fanny de la Rosa: APEDE is urging the Government to take a look at four sectors: finance, tourism, agro-fisheries, and logistics. The last two are connected and the agro-fisheries industry will be benefited greatly from having a solid logistics platform.
- Do you think the Panama Canal Authority should venture into other non-core commercial activities? Both panelists agreed that the ACP should not compete with other companies, but rather should collaborate with them. The ACP should only take on new commercial ventures in areas where there are no private companies available to develop. The ACP’s focus should also be in improving the logistics platform of the country.
All in all, it was a very informative forum where lots of points were discussed. The British Chamber is attempting to obtain all the presentations from the day to share with our members, so stay tuned!