The Culebra Cut stretch of the 50-mile Panama Canal
Source: AFP Getty, via Houston Chronicle
Panama’s great referendum on expanding the mighty Panama Canal, to accomodate two times’ as much ship traffic, is taking place today. 1.7 million Panamanians are registered to vote on the $5.3 billion upgrade, essentially a bond project to be financed with crossing fees. Local muni-bond initiative as is, it will affect billions of people around the world. Some 70% of Panamanians are polled to favor it ahead of the vote.
Panamanian babes pass a sign urging passage of the Canal referendum
Source: AFP Getty, via Yahoo! News
The widening of the canal is the greatest move since Panama’s 1903 independence, according to President Martin Torrijos, whose father won back the Canal from Jimmy Carter in 1977, and Panama took possession amid fireworks at midnight, 2000 in the Millennium.
Not only will the new canal be able to take twice as much traffic – each boat will be able to handle three times the amount of cargo it can currently carry, so has the potential to expand its sector of world trade sixfold. 2 x 3 = 6.
Great cargo ships pass through the Gatun locks near the Atlantic
Source: Associated Press, via MSNBC
The Canal currently handles 4% of world shipping traffic (and that figure is from 2000, so it’s likely higher than that – UPDATE: BBC has the recent figure, it’s 5%), so a potential sixfold increase will create marvellous opportunities from the outermost reaches of the Atlantic to the far side of the Pacific.
At the ports around the world – in Singapore, in Zanzibar, in Dubai, in Pondicherry, in Madras, in Colombo, in Makassar, in Jakarta, in Kuala Lumpur, in Guangdong, in Kaohsiung, in Osaka, in Shanghai, in Manila, in Sydney, they wait.
In Houston, in Buenos Aires, in Norfolk, in Sao Paulo, in Baltimore, in Miami, in New Orleans, in Savannah, in Dakar, in Newark, in Capetown, in Caracas, in Boston – they wait.
The points of expansion along the Panama Canal route
Source: The Panama Canal Authority, via Wikipedia
Everyone in the world who trades is watching Panama today. If Panama passes the referendum, whole new trading opportunities will spring forward. All of those ports will benefit. Shipping costs will fall, more nations will be able to participate, and living standards will rise – around the world. Walmart prices will get still lower, countries like India and Senegal will be able to get deeper footholds into world trading, energy supplies will become more abundant – the possibilities are endless – and they are all good.
Panama’s voters will be able to ok the newest in technology, tech that would not be possible without their will to make it happen – exotic new kinds lighting that permits night crossings, water level modifications that will prevent El Nino problems, and drilling technology that can now go through solid bedrock, deepening the canal to allow heavier ships through. Check out the Panama Canal’s live Web cam of gigantic ships bouncing through the locks like baby toys.
Cargo ships full of Wal-mart goods pass through the Gaillard Cut near the Pacific
Source: AP, via Washington Post
Amazingly, despite the fact that more than 70% of Panamanians want this – those smart, dollarized Panamanians who are turning their country into a lovely increasingly prosperous place on earth, the mainstream media sees only problems with this expansion. It will cost too much! It will wreck the environment! It will benefit foreigners more than Panama! It will not work! They are so full of it.
For their information, credit rating agency Fitch put out exactly one ‘warning‘ to Panama if it dares upgrade its outdated canal – that it ‘risks’ a credit upgrade, which will lower its cost of borrowing and put it into the ‘A’ range of borrowers. That’s the big risk Panama is taking!
Naturally, the fringe-left is against this. I don’t know how Hugo Chavez feels about it – he wants a Nicaragua canal to to ship oil to China, a pipedream for sure, but he would surely like to get his hands on an expanded Canal. Miguel advises me that Chavez has been very silent about the whole Canal upgrade, something unusual for him. Meanwhile, UPDATE here, the Cuban communist press already is expressing its disdain for the measure in this stupid story here – so the picture is starting to emerge of what these anti-trade regional tyrants really think of it. As for Chavez, he may be supporting Nicaragua’s proposed canal because he knows Panama isn’t for sale and Panamanian prefer to make their own decisions about their Canal with their own financing, and not Chavez’s. It might be significant that Panamanian voters in favor of a ‘no’ on the Canal wore bright Chavista-red t-shirts, for what it is worth. In my opinion, whatever happens, the Canal will take eight years to upgrade and Chavez won’t last that long in office, so no matter what happens, Chavez won’t be around for it.
A Panamanian babe who just might have voted yes
Source: AFP Getty, via Yahoo! News
Brave Panama’s voters are voting not just to enrich themselves, creating 47,000 new jobs and adding $4 billion to their national coffers each year, they are also benefiting the world, enabling many many more people to participate. We love Panama for doing this. It’s Panama’s unique advantage in the world to be able to open it all to world trade. It will be a magnificent thing when it happens.
More Panamanian babes – these are Kuna women, whose tribe is famous for its beautiful artwork
Source: AFP, via Yahoo! News
UPDATE: Joy in Panama!!! And everywhere else! Makassar! Sydney! New York! Osaka! Dakar! Nearly EIGHTY FREAKING PERCENT OF PANAMANIANS HAVE APPROVED THE CANAL EXPANSION, a higher margin than even the biggest poll numbers indictated. FREE TRADE RULES IN PANAMA!!!!!!
UPDATE: Panama’s electoral tribunal has the whole results out and you can see them for yourself – the measure passed by a whopping 78.08% vs 21.92% on the ‘no’ side. 98.12% of the ballots were counted valid, with 1.04% of the ballots blank and 0.82% null. The ‘yeses’ won, and big. It wasn’t even close! The near-80% victory for free trade exceeded the most optimistic polls! So much for the great wave of isolation and leftism. Today struck a big blow against Hugo Chavez, once again. Read the whole cool thing on the official electoral site here.
UPDATE: Via Boz, I found this Miami Herald editorial extolling the importance of passing the canal referendum, giving arguments about the importance of Panama remaining globally competitive. Read it here.
UPDATE: Investor’s Business Daily has an editorial describing how the ports around the U.S. are excited by this move and how the canal expansion will lower Walmart bills for all. Read it here.
UPDATE: Financial Times, in more of an analysis than editorial, describes the fascinating details of how the Canal works – I linked this in the earlier Panama post, but it’s so good it’s worth reading again here.
Melissa de Leon Douglass at Global Voices has a truly excellent, comprehensive roundup from the Panamanian blogosphere, with emotions expressed ranging from ‘I’m proud of my country’ (the way it should be! And we should celebrate with them!), to photos of tears and misery from the 20% who voted ‘no’ (can’t wait to click on that link, just to be mean). It’s a must-see treat here.
Steven Taylor at PoliBlogger has some good droll commentary on the need for the upgrade plus lots of news links in this post here.
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