International conflicts showing effects on Canal traffic and business

Canal

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The Panama Canal, due to its importance for world trade, does not escape the collateral effects of the covid-19 pandemic and the conflict situations in the international environment that are currently taking place. 

A decrease in the trade of liquefied natural gas, in the traffic of elaborated merchandise and finished products and automobiles, impacts the operations of the Canal and reduces expectations, said the administrator of the Canal, Ricaurte Vásquez.

Thus, in this last year, situations such as the crisis generated by the pandemic, the war between Russia and Ukraine, and the tensions between China and the United States “have impacted the Canal’s operations.”

The senior executive of the Canal specified that this situation of armed conflict significantly reduced the trade of liquefied natural gas that passed through this route and that originally went from the United States to Asia. 

“That natural gas, the United States has diverted it to supply Europe, which was originally supplied from Russia,” the administrator of the interoceanic highway, of great importance for world trade, told National Television.

Vásquez pointed out that in addition to the above, as a consequence of the covid-19 closures in certain productive areas in China, certain important ports, including Shanghai and others, have been kept out of operations.

Due to this, as explained by Vásquez, a large amount of inventory has been accumulated that has not been able to leave China, which has reduced and impacted traffic in the Panama Canal, especially in merchandise that is finally made, finished products that go bound. for the United States.

The ACP administrator added that a third element that has impacted traffic through the interoceanic highway is the traffic of cars that come in vehicle carriers; whose ships have not had enough cargo to be able to move from Asia to the United States due to lack of semiconductors. 

“These three elements have practically reduced our traffic forecast for the year (2022). We hope to meet our economic goals, but it has been a very challenging year from that point of view,” Vásquez said.

At the same time, I have recognized the work that all the Canal collaborators have done in trying to keep the operation running and despite these challenges, recombining everything that has been the traffic of the road and still giving the necessary results.   

“We continue to contribute to the country, bringing foreign funds (to Panama) to be able to carry out development in the country,” said Vásquez, noting that the containership segment represents 45% of the Canal’s operations.

From January to June 2022, 7,263 vessels (+8.2%) transited the Panama Canal, of which 4,741 were panamax (+8.3%), 1,730 neopamax (-6.4%) and 792 small draft (62.3%), , according to figures from the Comptroller General.  

According to official statistics, total income from Canal tolls reaches $1,493,532 million, of which $668,331 million corresponds to Panamax vessels (+9.8%) and $825,201 million (-2.7%) to Neopanamax.

Since its inauguration on August 15, 1914 and even more so, with the expansion of its capacity in 2016, the Panama Canal has modified international trade saving time, distances and costs for the maritime transport of finished products and raw materials between different countries. .

The Panama Canal connects 180 maritime routes that reach 1,920 ports in 170 countries around the world, and where in the calendar year 2021 2.4% of world maritime trade transited.

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