Why the Panama Canal is Dying

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There’s an unprecedented Maritime crisis going on right now through one of the world’s most critical trade choke points the babelan Deb straight between Yemen and the Horn of Africa the houthis a major military faction in Yemen backed up by Iran have fired hundreds of missiles and drones at dozens of trade

Ships passing through the choke point over the past few months that has caused companies from all around the world to cease sending their ships through opting to take the longer route between East Asia and Europe around the entire African continent instead in January the United States and United Kingdom began

Launching aerial bombing raids against the houthis across Yemen in an attempt to destroy their capability to continue attacking Merchant ships in the area and unblock the babelan devb straet in the process returning the fastest possible trade route between East Asia and Europe to shipping companies as well but at the

Exact same time as this major Maritime crisis is rocking the Middle East and negatively affecting the entire global economy there is another simultaneous Maritime crisis that’s also happening over on the other side of the world in Panama that’s clogging up the Panama Canal too the most significant Maritime

Choke point that exists anywhere in the Western Hemisphere under more usual circumstances the Panama Canal provides a critical shortcut for ships traveling between the Pacific and Atlantic Oceans it is the primary trade route that Merchant vessels take when transporting trade goods between the US east coast

And East Asia or between the US and Canadian West Coast than Europe or between the US east coast and South America’s West Coast these three trade routes usually depend upon the Panama Canal to grant them their quickest and most efficient Journeys that geography allows them as the primary alternative

For all three is to sail all the way around the entire continent of South America instead and round the southern Cape Horn through the Drake Passage a journey that adds on average around 8,000 extra nautical miles and 18 more days of travel time over simply going through the Panama Canal as a result

Roughly 5% of all the trade in the world conducted by SE will usually pass through the Panama Canal on an annual basis which includes a very significant amount of all of America’s container traffic around 40% of it to be precise as the east East Coast relies on it to

Remain connected to Asia while the West Coast relies on it to remain connected with Europe the canal is also a vital strategic interest to the United States Navy as it enables American Naval assets to rapidly redeploy across different theaters of operation between the Pacific and Atlantic during times of

Crisis the canal used to be outright owned by the United States for decades between when they finished building it in 1914 until 1979 when the Carter Administration agreed to give the land back to Panama whereafter it was jointly controlled by both United States and Panama for another 20 years until the

Start of the New Millennium on January 1st 2000 when full Sovereign control over the canal was finally handed over to Panama during that long period when America directly owned the canal it proved to be a vital asset on more than one occasion during the Cuban Missile Crisis in 1962 the United States was

Able to use the canal to rapidly redeploy warships from the Pacific Theater into the Caribbean in order to assist with the naval blockades that Washington enforced on Cuba while during both the Korean and Vietnam Wars the United States Navy used the canal as its primary artery to transport troops and

Equipment to the military front lines in Asia and today even though Washington no longer owns the canal it remains of vital interest to the United States anyway in light of a potential great power conflict with China in the future over the ultimate status of Taiwan because if China initiated a sudden

Invasion of Taiwan and began with surprise first strikes against American Naval bases at Guam and okanawa the Panama Canal enables American warships based on the US East Coast to rapidly redeploy over to the Pacific and reach the theater of operations 18 days sooner than if they had to travel the long way

All the way around South America 18 critical days saved that could become vital to ensuring the ultimate outcome of the war if the invasion ever happens the canal is also the most vital asset that’s owned by the Panamanian government because the canal shortcut is so vital to so many economic and

Military interests from all around the world Panama is able to charge various tolls and fees in all of the ships that use it across 2022 alone when the canal was functioning normally the Panama Canal was able to earn a whopping $ 4.32 billion US for Panama’s government as a

Result which all on its own was equivalent to roughly 65% of Panama’s entire GDP Panama as a country is basically a state that is based around this canal in control over this choke point it’s no surprise that the country’s most densely populated belt of people follow the Canal’s route it’s

Largely the reason why Panama is among the wealthiest and most developed countries in all of Latin America today and without the canal the entire country would be in some very serious trouble as would the entire globalized economy and the Strategic interests of the United States and unfortunately last year in

2023 and still lasting through today in 2024 the canal is beginning to break down and its future is suddenly becoming very uncertain and unlike the war that’s currently disrupting traffic through the Red Sea in the Suez Canal the problem that’s disrupting traffic through the Panama Canal is more natural and

Geographic in nature and so it’s much more challenging to actually solve it has to do more with unpredictable climate change increased droughts and rival Alternatives that stand to steal its market share in the future the war in the Middle East will eventually come to an end and traffic will continue back

Through the sez Canal like business as usual while traffic through the Panama Canal may be reduced indefinitely and in order to understand why you need to First understand how the Panama Canal actually works because it works completely differently than other canals around the world do and this is really

Important when a ship arrives at the Canal’s entrance encounters a series of three separate locks divided by Gates when the first gate opens up the ship at sea level travels into the first lock the gates behind the ship close and then a valve pumps water from the second lock

Into the first lock which lowers the water level in the second lock and raises the water level and the ship in the first lock when the water levels between both locks become equivalent the second gate is opened and the ship travels through into the second lock

Then the second gates are closed and the process is repeated again leveling the water between the second and the third locks then the third gate opens up the ship travels into the third lock lock the water level is raised back up again from the lake on the other side then the

Third gate opens up the ship travels into the third lock and then just like that the ship has been raised up 26 M in elevation above from where it started at sea level and can then effortlessly travel the rest of the way across Panama largely over Lake Gaton at 26 M up in

Elevation which was a lake that was artificially created by damning the nearby churas River to flood the interior here then when the ship reaches the other end of Lake Kon it has to be lowered back down to sea level again through the exact same water leveling process as before but simply in the

Reverse order well it’s undoubtedly a genius design built to overcome Panama’s hilly topography the big issue with this process is that it requires a lot of fresh water to actually function when the ship enters that first lock the water level within the lock is raised by

The water being pumped into it from the second lock which originally came down the chain from Lake Aon itself but then in order to accept the next ship into the canal from sea level that extra water in the first lock has to be emptied out into the ocean and this is

The same on either of the canals ends the water that the canal uses for this whole process comes from the two artificially created freshwater reservoirs nearby lake alaha and Lake Aton with Lake Aton being by far the primary source each Transit through the Panama Canal consumes around 52 million

Gallons of fresh water from these reservoirs to make the whole process possible and then the water that’s lost from the reservoirs is usually replenished with rainfall so as long as the rains continue replenishing the Lakes the water that the canal drains from the Lakes will keep getting replenished and the canal can continue

Operation as usual and continue providing all of its immense economic and strategic benefits but during a time of really bad drought when the Lakes aren’t being replenished by rainfall quickly enough the entire system can start breaking down and that’s basically what’s started happening now in 20203 Panama you see is generally a pretty

Rainy country but there are usually separate dry and wet Seasons that cycle across the year Panama’s wet season where most of the rain usually falls on the country lasts from around April through November while the dry season usually last through the winter from December through March but in 2023 a

Climatic event known as El Nino began severely disrupting this usual process in Panama El Nino is a regular Oceanic and climatic phenomenon that cyclically repeats about every 2 to 7 years in the Central and East Central Pacific Ocean during an El Nino event the usual trade

Winds that blow from the East to the west and push warm water away from the Americas to the West begin to weaken and so warm water is pushed back further to the east back towards the America’s West Coast that prevents deeper colder Waters from upwelling towards the surface then

This big patch of warm water that sits off the West Coast disrupts the area’s usual atmospheric circulation pattern and winds that usually carry rains into Panama become weakened or fail altogether this is what began happening in 2023 but the drought that has caused in Panama this time has been much more

Severe than what’s historically been normal rainfall in Panama during the month of October in 2023 was 41% lower than historically usual for that month the lowest level ever recorded in Panama’s entire history since recordkeeping began back in the 1950s and October is usually the rainiest month of the year for the country

Overall the 2023 rainy season in Panama ultimately failed to materialize with the government reporting that the year saw the second lowest levels of rainfall ever measured in Panama’s history and built more than 100 years ago now back in the early 20th century before modern climate change and climatic effects were

Well understood the Panama Canal was never originally designed with this severe of a reduction in range fall in the future ever being in mind without the rains replenishing the lakes and with the canal still consuming huge amounts of the water from the lakes to continue operating the Lakes water

Levels have been decreasing to unprecedentedly dangerous levels down to about 3 M lower than they usually are at this time of year and now in January going into February Panama is in the middle of its usual dry season and the lakes aren’t expected to begin getting any of the replenishing Waters until the

Next wet season starts to hopefully pick back up again in April but it might not Nino events typically last for around 9 to 12 months but as the effects of climate change have been worsening around the world El ninos have sometimes been lasting for longer and they can

Sometimes even last for years Noah stated back in September of 2023 that the currently ongoing El Nino had a 60% chance of lasting through to the summer of 2024 which means that there’s a pretty decent chance that this year’s rainy season in Panama will also become disrupted and the lakes in the country

Will continue struggling with being replenished which ultimately means that the Panama Canal itself is simply running out of the water from these lakes that it needs to continue functioning a huge compounding problem that the drought and the Canal’s heavy water consumption is putting on Panama is that besides being the primary water

Source to feed the canal Linka ton is also the primary drinking water source for most of Panama’s population of 42 million people the lake provides roughly half of all these people’s drinking water supply especially because it’s the biggest source of freshwater that’s located anywhere nearby to both of

Panama’s largest cities and the most densely populated part of the country that hugs the Canal area and visualize how much water the canal consumes from the same Source a single ship’s Transit through consumes the same amount of water as half a million panamanians do in a day and dozens of ships usually

Transit through it every single day this means that Panama is facing a very difficult set of decisions right now with regards to how it chooses to utilize the diminishing Water Supplies in the lake will it allocate more of the decreased supply to the operation of the canal that funds the Panamanian

Government with billions of dollars and represents 62% of the country’s total GDP or will it allocate more of the decreased water supply to their millions of citizens who depend upon it for their drinking water the government really has no other choice than to either ration water supplies for the canal or ration

Water supplies for its people and so far the government has been choosing to ration the water supplies for the canal by enforcing a series of increasingly harsh restrictions on the Canal’s usage the Panama Canal Authority that oversees the Canal’s operation has been steadily adapting to the changing circumstances

By reducing the number of ships that are allowed to pass through usually under normal circumstances a total of 36 ships are allowed to pass through the canal on a daily basis but as the Water Crisis in the country has intensified the limit has been steadily getting reduced down

To 31 ships per day and then down to 24 ships per day and in February the limit is expected to decrease even further down to only 18 ships per day half of the ships that are usually allowed to pass through under normal circumstances allowing only half of the ships through

The canal as usual saves half of the water that the canal usually consumes from the lakes and the authority is adopting even more drastic measures to cut down on the water consumption even further if the ships wanting to pass through are small enough two of them will be allowed to Transit through the

System of locks at the same time and in order to reduce the amount of water that they need to pump into the locks to keep the ships afloat in them the authorities restricting the volumes of cargo the ships are allowed to carry with them through the canal with lighter loads the

Ships displace less water and require less water to move through the locks but it also means that in addition to only half of the ships is usual being allowed to pass through the canal the fewer ships that even are being allowed to pass through are carrying up to 40% less

Cargo than they usually would be combined these series of restrictions on trade through the Panama Canal have been generating massive delays for ships wanting to pass through it which is causing huge disruptions in the trade flows between the US and Canadian East Coast in Asia between the US and

Canadian West Coast with Europe and between the US east coast and the South American West Coast before the restrictions ships who wanted to pass through the Panama Canal could either book their Passage up to 3 weeks in advance or simply show up without a reservation and wait in line as recently

As the beginning of November 2023 the average wait time for these ships showing up without a reservation was still only around 2 days and was still far better than taking the alternative route around South America that usually adds around 18 extra days of travel but within only a month by the end of

November as the Panama Canal Authority began enforcing its heavier restrictions these average weit times for ships without reservations skyrocketed by more than five times over to an average average of nearly 11 and 1 12 days with a maximum for some ships traveling southbound from the Atlantic to the

Pacific nearly reaching a whopping 23 days of waiting which means that traveling all the way around South America would have actually been quicker in that instance and while booking reservations in advance to use the canal used to be made 3 weeks beforehand they’re now often being made months in

Advance as the bottleneck continues getting worse these are the longest wait times that the Panama Canal has ever experienced in its entire history of operation and videos have captured the more than 120 ships at a time now that have been caught stuck waiting outside for their chance to pass through now ships

Arriving at the Panama Canal without a reservation are facing three difficult choices of their own that they have to make option one they can arrive and basically pay a bribe to the Panama Canal authority to skip the line and Advance through the canal quickly ahead of everyone else who didn’t pay in

November of 2023 a Japanese Merchant vessel paid an all-time high nearly $4 million bid just to skip through the line of the canal ever since then the lines at the canal have begun to get smaller and so the bids to skip the line have begun getting smaller as well as of

January 2024 the average bids being paid by ships to skip through have dropped to only about $269,000 but it’s not because the situation at the canal is getting any better it’s because most of the ships that are arriving are now choosing option two which is just skipping the

Canal entirely and charting a different route around it the problem with this choice right now though is that there are really only three viable alternative routes for ships to take around the Panama Canal the much longer and more expensive routes that consume a lot more fuel around South America or around

Africa or the slightly longer route that runs through the Red Sea and the Suez Canal unfortunately there’s another simultaneous Maritime crisis happening right now you may have heard of around the Suz canal with the Iranian backed houthis firing missiles and drones at ships in the area and the United States

And United Kingdom bombing them which has caused virtually every shipping company in the world to decide on avoiding the area for now until the war ends lest one one of their own ships gets hit and sunk there’s no telling how long the war around Yemen will continue

Going on for which means that the ships having to divert away from the Panama Canal also can’t use the Suez Canal which means that most of the world’s container ships are having to travel the very long very inconvenient and much more expensive historical routes around South America and Africa right now the

Only other choice available to ships arriving at the Panama Canal is to Simply tough it out and wait for their chance to cross which can sometimes last for weeks at a time none of these three choices are really ideal for shipping companies to take they all add unexpected increased costs to their

Journeys which will get passed on to Consumers through higher prices for the goods that they carry which will continue exacerbating inflationary pressures all around the world that are challenging to actually solve especially when combined with a simultaneous Maritime crisis in the Red Sea that’s causing similar increase costs and

Inflationary pressures both of these crisis happening at once at two separate major Maritime choke points is practically unprecedented situation for the global economy to deal with and unlike the problem in the Red Sea that the US and UK are currently trying to solve with bombs Jets and warships the

Problem in the Panama Canal can only be solved through either waiting it out or by spending years and a lot of money building out new infrastructure projects to make sure that a situation like this doesn’t happen again in the future the sheer scale of the logistical bottleneck

In the Panama Canal right now and the fears that increasingly unpredictable climate change could continue causing the same kind of problem for the canal more frequently in the future have led to a Resurgence in interest for proposed alternatives to the Panama Canal proposals that historically haven’t really ever gone anywhere while the

Panama Canal has functioned normally but proposals that could all of a sudden now completely revolutionize the way that trade flows around the world in the near future and proposals that could end up deeply cutting into the increasingly unreliable Panama Canal stable historical market share as it currently stands there are four major

Infrastructure projects that have been proposed across the Americas as alternatives to the Panama Canal in the 21st century with varying levels of credibility and non-ib the first major proposed alternative has been the so-called bi Oceanic Corridor a series of paved highways and bridges extending across Lower South America through the

Countries of Chile Argentina Paraguay and Brazil that will eventually enable trucks to carry goods from coast to coast rather than ships nothing quite like this has ever been built before in the region because of South America’s uniquely challenging geography the continent beneath the Panama now has always presented challenging barriers to

Regional integration it is a continent that is dominated in the west by the enormous Andes mountain chain the longest continuous mountain chain anywhere on the surface of the Earth that runs for nearly 9,000 km and the highest mountain chain located anywhere outside of Asia with average elevations

Of more than 4,000 m above sea level the Andes effectively block the entirety of South America’s West Coast from being able to access the Continental interior while the infamously dense jungle Les of the Amazon rainforest effectively block off the entirety of South America’s northern coast from being able to access

The Continental interior as well these Geographic facts meant that over a period of centuries as European colonization of the continent accelerated three distinctly separated areas of civilization and high population density arose in South America that exist today the east coast of the continent in Brazil Uruguay and Argentina the Southwest coast in Chile

And the northwest coast in an arc running from Bolivia through Peru Ecuador Colombia and Venezuela the existence of the Andes Mountains and the Amazon rainforest has long prevented the construction of land-based train links like roads or Railways between all three of these centers of population which is

Why trade between all of them has almost always been Maritime based instead despite all of them being technically connected by land and after the 20th century began most of that Maritime trade between these South American regions all went through the Panama Canal there are still several countries

Today on the continent that border each other by land but don’t have any Roads connecting them together Colombia still doesn’t have any Roads connecting it to Panama Brazil or to Peru Venezuela doesn’t have any Roads connecting into Guyana and serame doesn’t have any Roads connecting into Brazil the very first

Road connecting Brazil with Peru wasn’t even completed until 2011 and as recently as 2019 this huge region in Western Paraguay the size of Austria didn’t even contain a single paved Road at all this region in Paraguay is part of the overall Grand choco region of South America a huge hot and Aid Spring

Of scrubland Savannah and swamps that extends east of the Andes Mountains across Bolivia Argentina and Brazil as well with very little freshwater resources and very little rainfall trapped in the rain shadow of the andies mountains to the West the grand chako has always been an underdeveloped part

Of the South American continent it takes up 2/3 of all of Paraguay’s territory and yet it is only home to 3% of Paraguay’s population which is why an area the size of Austria here didn’t have any paved roads as recently as 2019 but now only a few years later Paraguay

Has gone on an unprecedented Highway building Spree Running throughout the area more than 3,000 kmers worth of additional roads and bridges have been paved in the country since then and by next year in 2025 they’re long talked about bi Oceanic Corridor should finally be completed and once it is Paraguay

Argues that it will stand as the Lynch pin in one of the world’s most significant new trade routes that will compete directly with the Panama Canal for business the so-called Southern Co region of South America is overall the continent’s most prosperous and most economically productive its latitude mirrored in the northern hemisphere

Would roughly correspond to the latitudes of the US Mainland Europe northern China Korea and Japan once the bi Oceanic Corridor is open and fully operational soon trucks from Southwestern Brazil will become capable of thundering through the Grand chako region towards the Pacific ports in Chile laid in with their agricultural

Products destined for export to East Asia without having to rely on the Panama Canal further north trucks from from Argentina will become capable of hauling their beef products to those same Chilean Pacific ports for quicker exports to Asia while both Brazil and Argentina alike will become capable of

More easily importing products from Asia as well rather than relying on Asian Imports coming in through the Panama Canal Brazilian and Argentinian trucks will be able to carry their own exports Bound for Asia to Chile then at those same ports load up on their Imports coming in from Asia and then carry those

Imports directly back home and perhaps even more importantly the bi Oceanic Corridor will prove revolutionary for the development of the so-called lithium triangle region located nearby to it right here a region that spans across Chile Bolivia and Argentina that is currently believed to possess more than half of the entire world’s known

Reserves of lithium an element that is crucial for the creation of lithium ion batteries that will power the 21st Century’s green energy transition there are even those who believe that as the world moves further and further toward green energies the lithium triangle in South America will become the 21st

Century version of what happened to the Middle East during the 20th century and its proximity to the bi Oceanic Corridor will enable its lithium to travel on the backs of trucks to Atlantic ports in Argentina and Brazil for direct export to the US east coast in Europe without

Having to travel through the Panama Canal at all that could end up making Paraguay the Lynch pin in the future world’s green energy trade if they play their cards right and it could make the bi oana Corridor one of the future world’s most important trade routes that

Everyone will want to make sure remains secure stable Paraguay ultimately claims that once the project is finished it’ll save the countries of the Southern cone 14 days of travel time and $1,000 per container to use it over the Panama Canal which if true would become a net Savings of roughly onethird of these

Country’s current Logistics costs which would almost certainly cut into the Panama Canal’s current and future business the second currently proposed alternative to the pan Canal is located further to the North in South America across Colombia currently Colombia has four separate Freight Railway networks two in the east of the country that

Connect to Columbia’s Coast on the Caribbean one in the west that connects to Columbia’s Coast on the Pacific and one more in the East that doesn’t connect to either of the coasts because these rail systems are currently all geographically separated from one another because of Columbia’s mountainous geography up here at the

Northern extent of the Andes there currently isn’t any way for trains to carry Freight from one of Colombia’s coasts over to the other but within just a few more years the Colombian government plans to finally fix that the government is already conducting feasibility studies for what they’re

Calling an inter Oceanic train a new rail network that will be built around and through the Andes mountains and connect the country’s Railways between the Pacific and the Caribbean the new rail Corridor connecting the two halves will require nearly 200 km worth of extra track to be built including at

Least 11 km worth of tunnels the government is currently expecting to award the building of the project to a company sometime before 2026 and Colombia hopes that whenever it’s finished it’ll transform Colombia into one of the new epicenters of globalized trade in the Western Hemisphere by offering up a vile rail alternative to

The Panama Canal with the ability for ships to unload cargo on one side and have it rapidly transported over to the other side for load up onto another ship and even though this project is still several years away from getting started it’s still at least being planned to get

Started eventually unlike the third currently proposed alternative to the Panama Canal is located further to the north across Nicaragua there have been proposals to build a canal here across Nicaragua going back hundreds of years now in theory the country geography lends itself pretty well to such a

Project because of the existence of Lake Nicaragua to the west of the lake is a very narrow ISM that’s only about 19 km wide while to the east of the lake is another slightly less narrow ismith that’s only about 100 km wide taken together it would only take creating a

Canal across about 120 km of land here to create another link between the Atlantic and Pacific Oceans only a little more than double the length of the ismos in Panama and significantly shorter than the Suez Canal is in fact before getting started on the Panama Canal the United States was initially

More interested in potentially creating a Nicaragua Canal instead until the opportunity in Panama presented itself later after America abandoned its plans for Canal across Nicaragua after the Panama Canal made the idea redundant the idea basically died and was forgotten about until it was suddenly revived again more than a century later in 2012

That year the Nicaraguan government passed a new law that authorized the creation of a state-owned Nicaragua Canal Authority analogous to the Panama Canal Authority further to the south then the following year in 2013 the Nicaraguan government awarded the construction bid for the canal to a Chinese company called Hong Kong

Nicaragua Canal development company or hknd hknd was led by a Chinese billionaire industrialist named wayang Jing his company and the Chinese government were planning on securing the $50 billion worth of funding they expected the construction of the Nicaragua Canal would ultimately end up costing it was projected that once the

Canal was completed it would end up roughly doubling the Nicaraguan GDP after became a major rival to the Monopoly currently enjoyed by the Panama Canal and so in exchange for doubling their economy and providing all of the funding for the project Nicaragua agreed to Grant a mandate to hknd that would

Enable them to be the sole operator of the canal for a period of 50 years with a potential option to extend the exclusive mandate further for another 50 years afterward if it was ever completed the project would have essentially granted the control of a Panama canal-like rival across Nicaragua to the

Chinese government for upwards of a century similar to how long the Panama Canal ended up being directly under the control of the United States for that probably never ever would have been tolerated by Washington but thankfully for them the project never even managed to get off the ground in the first place

Environmental feasibility study suggested that the project could end up introducing salt water into Lake Nicaragua and destroy the largest source of fresh water that can be found anywhere in Central America in the process Nicaraguan Farmers protested bitterly against the proposals to expropriate their land for areas that

The canal would flood and then between 2015 and 2016 the Chinese stock market crashed and Wang Jing lost the vast majority of his once enormous Fortune within only 3 years between 2015 and 2018 his estimated net worth rapidly evaporated from around $10 billion down to only $95 million a more than 90%

Decline in its Fortune to date construction on the Nicaragua Canal has still never even begun more than a decade after it was first announced and despite longtime Nicaraguan president Daniel Ortega’s vows that the project will eventually be finished hardly anybody in the world actually believes him anymore Ortega has remained in power

In Nicaragua ever since 2007 and has featured frequent violent crackdowns on opposition movements against him in elections that have been widely criticized as being unfair and rigged tens of thousands of nicaraguans have fled the country into neighboring Costa Rica as the country has grown increasingly authoritarian and corrupt

Under his rule While most of Nicaragua is government officials are actively under US economic sanctions the Orga regime in the country therefore has an incredibly terrible relationship with the United States as a result while Nicaragua is overall one of the poorest and most deeply corrupt countries in the Americas on the corruption perception

Index an annual index measuring corruption in all of the world’s countries compiled by an NGO called Transparency International based in Germany Nicaragua ranks as not only one of the Count’s worst riddled by corruption in the Americas but in the entire world as of 2022 Nicaragua ranked

As being tied for the 11th most deeply corrupted country on Earth and is only just barely beaten out by the likes of North Korea Haiti Yemen and Venezuela There is almost no hope for this country ever creating a canal that will cost tens of billions of dollars anytime soon

And so that brings us up to the fourth and final currently proposed alternative to the Panama Canal that’s further to the North in Mexico just as with the narrow ises across Panama and Nicaragua there have also been proposals and surveys to carve out another canal between the Atlantic and Pacific across

Mexico’s narrow ismos of tahu anek for centuries ever since it was first encountered by her non cortz at its narrowest point the ismus separates the Two Oceans by only about 192 km which is about precisely the same length as the sews Canal is more than a century ago

Back in 1907 the Mexican Government built a railway across the ismos here to transport Freight from one side over to the other between ships waiting on either end but then only 3 years later after that in 1910 the Mexican Revolution exploded in the country and threw Mexico into chaos for the next

Decade and during that chaos the Panama Canal opened in 1914 and ate the tahu anek railways lunch the railway fell into disuse and disrepair for a century afterwards as global trade shifted to the South through Panama and then almost out of nowhere in 2020 the Mexican Government under President Andreas

Manuel Lopez oidor or amlo for short announced that Mexico would finally begin revitalizing the the old tahuan toeg rail route again this new Rail Project across the ismus is now officially known as the inter Oceanic Corridor of the ismiss of tahuan Pac the ports on either end of the Es at queta

Koos and Selena Cruz will be modernized and expanded an updated high capacity passenger and Freight rail line will be built between them and industrial parks will be constructed along the railways route The Mexican government is investing $ 2.85 billion us into this project and once it’s expected to be

Completed in the early 2030 next decade amlo boasts that it will become an even faster and cheaper alternative to the Panama Canal the government is currently projecting that by 2028 the route will already become capable of carrying 300,000 Caro containers between the two oceans on an annual basis while by 2033

When it’s expected to be fully operational the rout should be capable of moving 1.4 million cargo containers between the oceans representing about 33 million tons worth of total Freight by comparison back when the pan Canal was operating more normally in 2022 the canal moved 63.2 million tons of freight

Across the whole year which means that Mexico is projecting that their in Oceanic Corridor of the ismiss of tahuan Pac will be moving about half of the volume of the Panama Canal within only a decade from now the project will prove critical for developing Mexico South which has consistently been among the

Poorest and least developed parts of the country for centuries now and as a result the project is already seen as being amlo’s single most important infrastructure project project of his entire time in office of all the four possible proposed alternatives to the Panama Canal it is this Rail Project in

Mexico that wields the greatest promise and keeps the Panama Canal Authority up at night the longest if the climatic effects that negatively impact the Panama Canal continue growing worse in the future and the canal grows less and less reliable then how much will these four potential alternative projects eat

Into the Canal’s current and future market share of global trade the Panama Canal Authority knows that they are soon going to be facing some stiff competition and that’s why they’re already proposing the fifth alternative to the Panama Canal simply fixing the Panama Canal’s problems and upgrading it

So that these problems become less of an issue in the future the Canal’s board has already proposed some of their own potential solutions to solve the water problem such as daming up the Indio River nearby to add another water reservoir to the already existing alua and gatun reservoirs or drilling a

Channel through a nearby Mountain to bring in more water from elsewhere in the country to help replenish Lake Gaton faster but these propos proposals will cost money and take time to complete approximately $900 million in roughly 6 years based on the board’s own estimates the idea of flooding even more land in a

Small and densely populated country for a brand new water reservoir in the country is already enraging locals who fear the loss of their lands through further government expropriations but the country knows that if they fail to adapt to the changing climate the Panama Canal will probably begin dying a death

Of a Thousand Cuts as the 21st century continues progressing and Panama’s strongest geopolitical and economic asset could eventually become almost irrelevant or at least far less critical than it is today climate change will continue decreasing the Canal’s reliability while emerging competitors in Mexico Nicaragua Colombia and in Paraguay stand to eventually begin

Eating away at their Core Business If the unreliability continues in order to safeguard their own future and continued Prosperity Panama must begin preparing Now by taking difficult decisions L they wake up one day and realize that the flow of global trade has suddenly circumvented them Panama has been at the

Epicenter of globalized trade in the Western Hemisphere for more than a century now but it cannot afford to be comfortable or complacent because this may not remain the same case for The Next Century Finance is a rather difficult subject to master it’s a very easy thing to lose track of for both

Governments and individuals alike especially as companies increasingly design their services around you forgetting about them and forgetting you’re still spending any money subscription Based Services especially can really start adding up the more of them you forgot you signed up for so in order to help myself keep track of all

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