PANAMA: Panamanians protest plan to upgrade country's 92-year-old canal

Two days before a referendum on a multi-billion-dollar plan to modernize the Panama Canal, some 3,000 protesters turned out in force to demonstrate against it while several dozen protested in favour on Friday (October 20). At issue is a Sunday (October 22) referendum in which Panamanians will decide whether to adopt a $5.2-billion government plan to widen and deepen the waterway. The overhaul would give it is largest renovation in its 92-year history. Due to be finished in 2014, the plan needs $2.3 billion in loans or bonds to be paid back with revenues from higher tolls from ships using the canal. Construction, which is expected to create 7,000 jobs and up to 40,000 indirect jobs, is not expected to interrupt normal canal travel. But opponents say the size of the expansion is too risky for Panama, which is already saddled with a high debt burden, and if costs overrun, taxpayers could be forced to pick up the tab and investors lose money. Many, like Santana Martinez, are concerned about corruption. "Why do we have to believe in them when they've robbed us all these years?" he said as he protested against the plan. "That's why we're going to vote no and we're going to win on Sunday." Demonstrators for and against the renovations have taken to the streets of Panama City in the past weeks to promote their position on the contentious issue. On Friday, several dozen demonstrators waved flags in favour of the proposal, confident that an expansion would be good for the future. "For the new generations," said Luis Prescott, "for the country's progress, for social development, that's why we have to vote 'yes' on October 22nd." President Martin Torrijos has billed the referendum as Panama's most important vote since it became independent from Colombia in 1903 but opponents warn it could bankrupt the small nation if costs spiral. The Panama Canal Authority, or ACP, which runs the waterway, warns the route will become log-jammed in seven years if nothing is done, meaning business will be lost to competitors like the U.S. intermodal system of ports and cross-country rail links. The canal's outdated lock system is too small for many modern tankers. The proposal would provide new sets of wider locks and deeper and bigger access channels, double capacity and let ships with 12,000 containers pass through, up from a present limit of around 4,000 containers. Opinion polls show around two-thirds of people approve the government's proposal which would allow increasingly large tankers to pass between the Atlantic and Pacific oceans. Supporters of the expansion, planned to begin in 2008, hope it will bring a jobs bonanza for Panama's 3 million people. Opened in 1914 at a cost of $375 million and 25,000 lives, the canal ranks alongside France's Eiffel Tower, the Golden Gate Bridge in San Francisco and the English Channel Tunnel as one of the world's most stunning engineering feats. Dynamited and dug out by thousands of mainly Caribbean laborers who braved deadly malaria and yellow fever, the canal saves ships a long haul around South America's treacherous Cape Horn and carries around 4 percent of world trade. Ships making the passage, mainly from the United States, Japan, China and Chile, also face longer waits these days to make the 50-mile (80-km) inter-oceanic trip as global shipping grows, partly due to the Asian economic boom. France's Ferdinand de Lesseps, builder of the Suez Canal, started the Panama Canal in 1880 but abandoned it nine years later when the project went bankrupt. The U.S. government bought the canal in 1904 and 10 years later opened the waterway, running it for most of last century. In treaties signed in 1977 by then U.S. President Jimmy Carter and Panama's populist dictator, General Omar Torrijos, agreed to hand over the canal to Panama in 1999.

ITN Source | October 21, 2006

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