Article Courtesy from Business Panama

Ports in Panama Expand Their Operations
by Ernesto Castillo and Juan Carlos Croston (MIT)

The ports in Panama continue gaining ground as the most modern and efficient port platform in the Region, thanks to the Panamanian ports model that promotes competition and adapts itself to the reality of the worldwide and regional maritime market.

During 2004 ports in Panama increased their operations by 21% in comparison with 2003, reaching 2.4million TEUs (twenty-foot equivalent units). With more than $ 1,400 million invested in port infrastructure, the development of this sector in Panama presents new challenges in meeting the growing demand for merchandise transport services.

The new model for Panamanian ports administration is characterized by the combined work of the private sector, from a commercial viewpoint, with the State, as the granter of the concessions. This generates infrastructure investment to ensure legal stability.

In the medium term, the ports of Manzanillo International Terminal (MIT) and Colón Container Terminal (CCT) will expand their ports in Colón Province, and the investment programmed for the 69 hectares that to be developed will reach $500 million, to be disbursed over the next five years, and will generate 500 direct employees in addition to the hundreds of temporary workers employed for the preliminary work. Additionally, the development of a megaport on the Pacific side is contemplated, with interest being expressed on the part of international port operators as well as shipping lines, at a cost of approximately $600 million.

In respect of the container cargo segment Panamanian ports find themselves in a thriving market. Despite the fierce regional competition, the success of the local ports sector is a result of a business plan based mainly on transshipment cargo, complemented by the handling of local import and export containers. The MIT and CCT terminals, in direct competition with the principal ports in the Caribbean, moved nearly 1.9 million TEUs in 2004, which represents 75.6% of the transshipment containers moved in the country. These containers are discharged from vessels which mainly put in to port to transit or weigh anchor before transiting the Panama Canal. Therefore a high percentage of the business conducted by Panamanian ports is derived from ships using the Canal. At the same time, businesses connected with the maritime industry that are located close to the existing terminals are satisfying the demand for auxiliary services such as agencies, fuel, chandlers and provisions, repair and maintenance, thereby generating more added value and increasing the percentage contribution by the maritime sector to the GDP of the country.

In 1995, Manzanillo InternationalTerminal Panamá, S.A. (MIT) established a new Panamanian ports system to provide shipping lines with efficient, secure and reliable services. This year, MIT celebrates 10 years of successful operation and during this time has greatly increased the volume of merchandise while the improvement and expansion of its port installations has never ceased. With the growth of containerized cargo, Panama has become the largest trans-shipment center in the region, serving the East and West coasts of North and South America as well as Central America and the Caribbean, thanks to its exceptional levels of productivity, technology and security.

The success of the Panamanian ports operations has brought with it yet another interesting business segment: to make our country a merchandise distribution center for the region. Currently, Tocumen International Airport is engaged in a remodeling process at a cost of $50 million. With the Panama Canal Railway Company’s rail connection linking the two coasts and the development of MIT’s Logistical Park, located adjacent to the terminal, clients will benefit from the continuous movement of merchandise within the same fiscal zone. At the same time, shippers will be able to establish distribution points form Panama, serving various countries to distribute their products more efficiently and at low cost to markets throughout the Caribbean and Latin America.

The excellent multimodal infrastructure in Panama now gives support to regional logistical operations, offering the above-mentioned integrated facilities of rail, maritime and air services.


PanAmCham member Manzanillo International Terminal – Panama, S.A. is strategically located at Coco Solo which was used previously by the United States as an air/maritime base during the Second World War. The MIT terminal is situated near the Atlantic entrance of the Panama Canal, immediately adjacent to the Colon Free Zone.

Over the past 10 years MIT has promoted a number of community projects which have benefited Colon Province, with emphasis on education and sports.

MIT has been the recipient of many honorable mentions, such as:
• “One of the 10 most efficient ports in the world” Containerization International
• On three occasions has been honored by The Caribbean Shipping Association, who,
• in 2004, named MIT as “the best container terminal in the Caribbean”
 

Article Courtesy of Business Panama
The American Chamber of Commerce (AMCHAM)
and Deal Inc.

 

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