Panama set to begin $5bn project

Monday, September 03 2007 @ 02:39 PM UTC

Contributed by: Don Winner

BBC - Panama is set to start work on a $5bn (2.4bn) building project to widen the Panama Canal to increase its capacity. The project involves adding a third set of locks that will enable modern ships to use the canal. Many tankers are now too large for the 50-mile (80km) route. Panama residents overwhelmingly backed the plan in a referendum held in 2006. Supporters say modernization is vital to maintain trade and increase jobs, but critics say it will lead to huge debts for Panama. Opponents have also attacked the project on environmental grounds. It is estimated that, in volume terms, around 5% of the world's trade passes through the Panama Canal. The government has said the scheme will be financed by raising tolls on the waterway as well as through foreign credit. The beginning of the huge project will be marked by a ceremony attended by Panamanian President Martin Torrijos and foreign dignitaries.

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