Based on the 1977 treaty between the United States and Panama and an exchange of diplomatic notes among Panama, Japan and the United States, a trinational feasibility study is being conducted to investigate alternatives that will increase the transportation capacity across the Isthmus of Panama. By agreement of the three participating governments, all of the considered traffic improvements must be within the geographical area of the Republic of Panama. However, these improvements are not restricted to any one mode of transportation. The categories of improvements to be considered include, among others: expanding the dimensions of the Canal; supplementing the Canal with pipeline, rail and highway systems; overland transportation of ships, and construction of a sea-level canal. Each alternative must take into consideration the cost and competition from non-Panamanian routes such as the U.S. landbridge, as well as the advantages/disadvantages of one over the other. While it is clear that the Canal's capacity must be improved to meet the growing demands of world trade, the question remains as to what is the most feasible improvement to be made. To help make this decision, new trade projections are necessary along with fleet projections. Moreover, the determination of the nature and type of financing of improvements is critical. Recent studies have demonstrated that present Canal traffic is toll sensitive. Consequently, a simple raising of the tolls to finance a project is not the answer. In addition, environmental issues are as mammoth as some of the alternatives. To mention just a few, a sea-level canal has the probability of introducing new species to the Caribbean; while larger locks will increase the water demand with the possibility, according to some estimates, of having to pump sea water into the Canal to meet this demand. However, these questions are resolved, the selected alternative will have a profound effect not only upon Panama and its partners in the Study, but it will greatly impact world commerce and ecology.

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  • Accession Number: 00496581
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Aug 31 1990 12:00AM