Panama ports expect boom despite US slowdown |
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Written by Andrew Beatty
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PANAMA CITY, March 19
(Reuters) - Panama's ports expect shipping container volumes to grow by
a fifth this year despite a slowing U.S. economy as Chinese trade
surges, the head of the country's top maritime body said on Wednesday.
Fernando Solorzano told
Reuters he expects the country's principal ports to handle up to 5
million 20-foot (6.1-meter) equivalent units (TEUs) -- the size of a
standard shipping container -- in 2008.
In 2007, Panamanian ports
handled just under 4.1 million TEUs, up from 2.7 TEUs in 2006, thanks
in part to increased trans-shipping through the Pacific port of Balboa
on the mouth of the Panama canal. Balboa is run by a subsidiary of Hong
Kong's Hutchison Whampoa (0013.HK: Quote, Profile, Research).
Despite a slowdown in U.S.
consumer demand and the possible drop in trade between China and the
U.S Eastern seaboard, Solorzano said the fundamentals are in place for
continued growth in Panama's shipping sector.
"If everything goes well and continues as it has been, I believe we can reach this goal (of 5 million containers)," he said.
Rising imports like cars and consumer goods to China are expected to offset the slowing U.S. economy at Panama's ports.
Partly as a result,
Solorzano said there is still enough business for the construction of
another Pacific mega-port to be feasible.
Despite billions of
dollars in investment in recent years, Panama still lacks the port
infrastructure to handle the huge mineral imports from Latin America
that China needs to fuel its economic growth.
He said China's largest
shipping conglomerate, China Ocean Shipping COSCO (1919.HK: Quote,
Profile, Research), was still interested in establishing a new
billion-dollar port that could be located at the Pacific entrance of
the Panama canal, not far from Balboa.
Panama had planned to
auction the rights to operate the port but is reassessing the project
after a number of firms, including Danish shipping and oil group A.P.
Moeller-Maersk (MAERSKb.CO: Quote, Profile, Research), dropped out of
the running.
Solorzano said the
government will soon make a decision on how to move forward with the
project, which could now be awarded by a direct contract and not via a
tender process. (Editing by Matthew Lewis)
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