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THE WORLD

Panamanians Likely to OK Canal's Expansion Project

Polls show growing support for a 5-year government plan facing voters next month. The upgrades could ease traffic at L.A.-area ports.

September 23, 2006|Chris Kraul | Times Staff Writer

PANAMA CITY — Support is building among voters for expansion of the Panama Canal, a five-year, $5.2-billion project that could ease overcrowding at the Los Angeles-Long Beach port complex.

Recent polls show that support for the plan, which goes to a nationwide vote Oct. 22, is at nearly two-thirds of those intending to cast ballots. Approval has risen 6 percentage points in the last month, and some say the public has put aside initial fears that graft and indebtedness could swamp the nation's most important resource and symbol.

"It's our Statue of Liberty and Golden Gate Bridge all in one," said pollster Leopoldo Neira. His firm published an opinion survey in the local La Prensa newspaper Sunday that showed yes votes among probable voters outnumbered noes 63% to 33%.

The wild card is the generally negative results of past Panamanian plebiscites, Neira said, a reflection of ingrained public distrust of the government. Still, he believes only a major scandal tainting the government of President Martin Torrijos could scuttle prospective passage of the measure.

"The expansion is not for our benefit but for that of our children and our children's children," said Panama City taxi driver Mauricio Reyes, who said he expected business to improve with the expansion.

The quasi-independent Panama Canal Authority, which runs the waterway and would manage the expansion, said Thursday that the canal was on track to generate about $1.4 billion in revenue this year, 15% more than last year, a reflection of increasing global trade. One of the fastest-growing segments of this commerce is cargo going between Asia and the U.S. East Coast, some of which uses the Panama Canal.

The expansion would ostensibly slow the traffic growth at the Los Angeles-Long Beach port complex. There, much Chinese and other Asian cargo headed for the U.S. East Coast is offloaded or transferred to other ships, because many of the Asian cargo boats cannot fit through the Panama Canal.

The Torrijos government has touted the supposed benefits in jobs and revenue for social projects from expanding the 51-mile canal, while warning of the risks of doing nothing.

Those risks include the possibility that Mexico or other Central American countries could build competing canals or port-highway complexes to move the accelerating flow of worldwide freight. Government officials in Chile and El Salvador have been quoted recently as saying a rejection of the canal expansion would lead to the development of alternative cargo routes.

Neira said three-quarters of Panama's population believes the government is corrupt, and a significant portion expects expansion costs to outstrip the projected amount, possibly piling up debt that would spoil the nation's healthy finances.

In response, the Torrijos government has promised transparency in the bidding process, with contracts of $10,000 or more subject to a public bid. As for cost overruns, officials say the $5.2-billion figure includes a possible $1-billion overrun plus 10% annual inflation. The administration is promising Panamanians they are not at risk, that canal customers would shoulder the expansion cost with their tolls.

The expansion as proposed would include a new locks to accommodate so-called post-Panamax container ships capable of carrying up to 8,000 metal freight containers, twice the canal's current per-ship capacity.

Ruben Carles, a former controller general and one of several onetime government officials who have expressed concerns over the transparency of the project's finances, said in a telephone interview Thursday that he was confident that the government would "render accounts" as the expansion proceeds and that he supported the expansion.

Former Vice President Ricardo Arias Calderon said in an interview, "It will be historical suicide to not widen the canal."

Even those still opposed concede that the yes votes are likely to win by a comfortable margin.

"Yes could win 2 to 1," said one attorney close to the opposition, who asked not to be named.

Confident of victory, the government is going ahead with plans for a $50-million network of 35 technical schools to train skilled workers needed for the expansion. Although the canal construction would employ no more than 7,000 workers, Torrijos is promising an enormous "multiplier effect" of indirect jobs from the project and expanded canal.

chris.kraul@latimes.com

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