Voters approve Panama Canal expansion plan
The expansion will allow the world's largest ships to squeeze through the shortcut between the seas.india Updated: Oct 23, 2006 10:11 IST
Voters overwhelmingly approved the largest modernisation plan in the 92-year history of the Panama Canal, backing a USD 5.25 billion expansion that will allow the world's largest ships to squeeze through the shortcut between the seas.
In a referendum marked by low turnout on Sunday, Panamanians approved an overhaul that will build a third set of locks on the canal's Atlantic and Pacific sides to handle modern container ships, cruise liners and tankers that are too large for the waterway's current 33-meter-wide dimensions.
Construction is set to begin in 2007 and will take up to eight years to complete. The Panama Canal Authority, the autonomous government agency that runs the waterway, says the project will double capacity of canal already on pace to generate about USD 1.4 billion in revenue this year.
Expansion will be paid for by increasing tolls to produce annual revenue of over USD 6 billion by 2025. A large chunk of canal revenues go to education and other Panamanian social programmes.
Still, critics contend that as drawn up, the expansion plan benefits the canal's customers more than Panamanians, and worry that costs could balloon for this debt-ridden country.
President Martin Torrijos, an outspoken supporter of expansion, said after voting on Sunday that the referendum was "probably the most important decision of this generation." On the sweltering streets of Panama City, those wearing green T-shirts, bandanas, caps and vests supporting expansion were everywhere.
First Published: Oct 23, 2006 08:59 IST