Panama Canal Officials Brief Industry on Expansion Plans at Panama Maritime VIII World Conference

In a word, Shipowners are “nervous.” That’s how the International Chamber of Shipping’s general secretary described the global reaction to the newly announced Panama Canal toll fee increase plans. Tony Mason also told listeners at the Panama Maritime VIII World Conference that the $5.25 billion project intended to expand and improve the canal was being welcomed by the shipping community, but the scope of the increases has shippers worried about how they will pay for it.

During the conference, Panama Canal Authority (ACP) executives briefed maritime industry leaders on the state of the Panama Canal. Canal officials described the state of the Canal to be “excellent” and that the expansion project was now at its initial stages. They also said that demand for the Canal was at “unprecedented levels and the value of the Canal … was at an all-time high.”

Canal officials also addressed the need for adapting the canal to a changing world. Doing that, they said, would depend on maintaining adequate revenue streams. Canal officials went to say that “Panama Canal tolls have not increased in non-container segments -approximately 50 percent of Canal traffic - since 2002. Just accounting for inflation over the past four years would call for a 10 percent increase in tolls; over seven years, approximately a 16 percent increase. The ACP’s proposal follows a rare process in the industry of a 35-day comment period and will culminate in a public hearing.”

The ICS’ Mason cautioned his audience that any toll increases needed to be manageable and predictable, proportionate to each business sector and finally, the Canal authority should ensure that the burden of the cost of financing the expansion should not be placed solely on the shoulders of current users.