Expanded Panama Canal scripts maritime history

Sunday was the day for festivities and pride in Panama as people there marked the inauguration of newly expanded multibillion dollar Panama Canal that will link the Atlantic and the Pacific Oceans and boost the
regional and international trade.
Currently, some 5 percent of global maritime commercial traffic uses this strategic waterway, which provides a valuable shortcut between North America and Asia.
To celebrate the occasion, Panama invited 70 heads of state to watch on Sunday as a Chinese container ship became the first commercial vessel to attempt the passage from the Atlantic Ocean to the Pacific through the larger locks.
The expanded canal re-positions Panama as a strategic maritime lifeline in the 21st century as it was in the last century. The unveiling of the broader canal was a moment of pride and of opportunity. Annual cargo volumes would double over the next decade, leading Panama to hope to triple the $1 billion in shipping fees it receives each year.
The canal will bring along with it huge trade benefits. It will be an inter-oceanic highway for goods between the United States and Asia. In addition, more cargo on bigger ships should mean lower transport costs.
Panama is also avidly eyeing the lucrative market of transporting liquefied natural gas between the United States and Asia, principally to Japan. The ships carrying the gas were too big to use the old canal. With the expansion, they can now have a smooth passage. With the US producing gas and oil from shale, American interest in using the canal has grown.
“There is evidence that the Panama Canal, with this expansion, is an important player not only for regional maritime commerce but worldwide,” said Oscar Bazan, the Panama Canal Authority’s executive vice president for planning and commercial development.
Despite the fanfare, there were hackles raised over the celebrations. Reason: The event comes amid a lull in global shipping due to the drop in oil prices, an economic slowdown in China, which is the canal’s second-largest customer, and other factors that have hit the waterway’s traffic and income.
There is risk over increasing commerce between Asia and ports on the US East Coast, as some ports are not ready to handle the huge new Panamex-class cargo ships.
The Suez Canal in Egypt has recently lowered tariffs by up to 65 percent on large container carriers in an attempt to keep its traffic. This could deal an
economic blow to the Panama Canal.
There are also safety, quality of construction and economic viability
challenges, according to an investigation by The New York Times.
The new canal needs enough water, durable concrete and locks big enough to safely accommodate the larger ships. On all three counts, it has failed to meet expectations, according to dozens of interviews with contractors, canal workers, maritime experts and diplomats, as well as a review of public and internal records.
Yet, the 102-year-old canal is capable to withstand these challenges through reviews and routine checks to maintain its position as one of the world’s vital maritime routes.