Estimates from canal administrators now suggest that the low water levels could potentially cost between $500 million and $700 million in 2024, a significant increase compared to previous estimates of $200 million.
This unprecedented drought, one of the worst to hit the Central American nation, has caused disruption along the 50-mile maritime route, leading to a backlog of vessels and raising concerns about the canal's reliability for international shipping. This, in turn, has sparked fears regarding the ripple effect on global trade.
Acknowledging the seriousness of the situation, Panama Canal Administrator Ricaurte Vásquez emphasized the need for urgent action. Ship crossings have already been gradually reduced from 38 a day to the current 24, with Vásquez highlighting the importance of addressing the water problem and finding a sustainable solution.
During the first quarter of the fiscal year, a noticeable decline in cargo volume and ship traffic was observed, with a 20% decrease in cargo and 791 fewer ships passing through compared to the same period the previous year. This reduction is deemed significant by Vásquez.
Panama Canal Administrator Ricaurte Vásquez emphasized that the water problem is a national concern that requires comprehensive action across the entire country. The severity of this drought demands immediate attention and collaborative efforts to mitigate its consequences.
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