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Will Panama Canal expansion boost global trade

Written by Neutral Scent Marketing Author, on October 13th, 2014

It took 40,000 workers nearly 10 years to dig the new access lane to the Panama Canal, a massive engineering feat that rivals the canal’s initial opening 102 years ago and that could potentially reshape the way goods move around the globe.

When the $5.4 billion expansion projectopens Sunday, it will nearly triplethe capacity of the original canal, cheap nfl jerseys allowing ships carrying up to 14,000 containers a quicker path between Asia and the USA.

Anticipation of the new high capacity lanesparked a global investment trend that dwarfedthe canal expansion price tagas ports from Rotterdam to New York to Brazil prepared to welcome the megaships. Butits opening comesamid a global shipping industry slump, raising questions aboutwhether these enormous investments will pay off.

“As the largest ships come, our ability to compete increases,” Rooney said.”It will be very dynamic and very interesting to watch.”

Opening in 1914, the Panama Canal was a marvel of engineering and dark history. Cholera, malaria and yellow fever claimed the lives of more than 22,000 workers who labored to dig the 50 mile canal through the jungles of the Isthmus of Panama. It took 44 years to complete, but ittransformed global trade bycreating a shortcut between the Atlantic and Pacific Oceans.

As ships grew in size, the canal faced mounting pressure to expand. The current canal can accommodateships carrying up to 5,000 containers. ports to Asia or western stretches of South America, de Marotta said.

“We’re opening up new markets that were never even considered before,” she said.

The expansioncomes amid a shipping industry slowdown linked to China’s faltering economy and sagging global demand.

Though bigger ships will fitthrough the canal, it doesn’t mean they’ll be filled with more goods, said Greg Miller, a senior editor at IHS Fairplay, a publication run by global consultants IHS. demand still dictates the amount of tennis shoes and microwaves that arrive here.

“The fact that the ships are getting bigger doesn’t necessarily mean there is going to be more cargo on them,” he said. “It could be the same cargo on a different ship.”

Though ports in New York, Miami and Long Beachhave invested in their own expansion projects to drawthe bigger ships, doubts linger on whether the UnitedStatescan export goods, such as wheat and other commodities, on the larger ships to take advantage of the expanded canal, said Nick Pansic of MWH Global, which worked on the expansion project. agricultural products leavefrom ports along the Gulf Coast, some of which have aging infrastructure and maybe unable to accommodate the bigger ships, he said.

“It’s not just a matter of importing more stuff to meet our demand, but there’s a real opportunity for the export of agricultural products more efficiently to Asia,” Pansic said. “That’s a big question mark.”

“We are now in a position to be a very, very serious player on the East Coast,” port director Juan Kuryla said.

Such ships account for only a fraction of overall shipping routes, sothere is no immediate need for a fourth set of locks, but, de Marotta said, just in case, planners set aside some land for a future fourth lane.

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