Biden Lauds Panama Canal Expansion
- Business & Finance
Yesterday in Panama City, Vice President Biden and President Martinelli discussed ways to strengthen U.S.-Panama economic cooperation in the context of global commerce and competitiveness.
Panama is the fastest growing economy in the region, expanding 10.7 percent in 2012. Panama’s largest trading partner is the United States – accounting for approximately 23 percent of all two-way trade. U.S.- Panama trade grew by roughly 20 percent to more than $10 billion in 2012 and has only continued to increase since the entry into force of the U.S.-Panama Trade Promotion Agreement (TPA) in October 2012.
Panama’s strategic location as a major shipping route – and its expansion of the Panama Canal – will only enhance the importance of the U.S.-Panama trade and the jobs it will support in both the United States and Panama.
Global commerce depends on the Panama Canal
More than one million ships have transited the canal since its opening in 1914, and roughly five percent of world trade passes though the isthmus every year. Following the opening of the expanded Canal in 2015, the Panama Canal Authority estimates that cargo volume will double by 2025. Given that the United States is the origin and destination of two thirds of the ships transiting the Canal, the third, post-Panamax shipping lane will boost the competitiveness of U.S. exporters by reducing shipping costs.
More business means more travel
In that context, the Vice President and President Martinelli announced joint efforts to expedite travel between the United States and Panama. The Vice President announced Panama’s incorporation into the Global Entry Program beginning January 1, 2014, which will allow for expedited clearance for pre-approved travelers upon arrival in the United States. President Martinelli also announced the incorporation of the United States into its reciprocal program, Panama Global Pass.
U.S.-Panama security cooperation is extremely close and serves to protect all the citizens of the region. With the support of the United States, Panama seized 175 metric tons of cocaine in the last four years. The Vice President acknowledged Panama’s leadership in the international community and its commitment to the security of the Canal as shown by Panama’s interdiction on July 10, 2013 of the Motor Vessel Chong Chon Gang, which was transporting arms and related material from Cuba to the Democratic People’s Republic of Korea in apparent violation of UN Security Council sanctions.
Panama’s cooperation with the UN to determine if sanctions busting occurred is a model of international responsibility by a sovereign state. The Vice President also highlighted Panama’s leadership as one of four Western Hemisphere countries that signed onto the September 2012 G-20 joint statement on Syria.
“The Panamanian government and the Panama Canal have begun the expansion of the Canal, and this Canal expansion leads to a completion in 2015. And likewise, we have discussed with Vice President Biden that already the United States and a number of other friendly countries must begin to study the possibility of Canal expansion, to do the appropriate studies so that when they’re done in a few years, what is called a fourth set of locks be completed, because as you well know, the world maritime community is continually innovating and increasing capabilities, and therefore, there is great potential for Panama to continue taking advantage of its position as a multimodal hub, which is very well complemented by what is happening in the ports along the East Coast of the United States,” stated Martinelli.
“You know, modernizing the Canal, Mr. President, is an investment in your future, but it is also a consequential investment in the future of the United States of America. It protects Panama’s unique place in the world economy as a new generation of massive container ships and tankers hits the high seas. You’re moving from the ability to accommodate a ship that’s 106 feet wide to a ship that’s 160 feet wide, doubling the commerce. And it’s an incredible consequence to this global economy,” said Biden.
Press Release, November 20, 2013