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The World Trade Survey page of the Pacific Shipper web site reports that the Taiwanese Container Terminal at Colon is requesting permission to convert 12 acres of their port facilities to a container yard. This expansion would increase capacity from its current 700,000 containers a year to 1,500,000. The terminal would need to pay $11.3 million USD the “additional land.”

Panama Canal Expansion, Container Shipping, and World Trade

Despite the specter of decreased world trade due to recession a major container facility in Colon wants to double its capacity. In fact, anticipating the completion of the Panama Canal Expansion ports are upgrading throughout Central America. Pacific Shipper quotes Mike Hopkins, vice president of operations in the U.S. for Crowley Maritime Corp., a shipping line active in the U.S. trades with Central America and the Caribbean, “All of the Central American ports have some expansion in mind, some more than others. [Central ports are no longer just] dry canal connection points for big ships coming from Asia and Europe. The growth rate of all of the Central America countries is sufficient in itself to warrant port and infrastructure expansions”

Hopkins mentions Puerto Cortes in Honduras as the largest port expansion project in the area. Costa Rica and El Salvador are also working on port upgrades.

Economic Cycles, Panama Canal Expansion and Container Shipping

Container facilities in Panama are upgrading in anticipation of future need. Business cycles come and go and during a downturn the wise prepare for the next burst of activity. There are container facilities being built in industrial parks along the Panama Canal in the old Panama Canal Zone. When the Panama Canal Expansion is completed the canal’s capacity will more than double and many cape size vessels will be able to transit from ocean to ocean.

Although much container traffic just passes through the Panama Canal the Colon Free Zone receives, sorts, and resends an immense amount of cargo each year. Forty percent of Latin American container shipments pass through the Panama Canal, much of that stops at Colon and is re-routed. As Panama Canal traffic expands there is room for investment in container facilities as well as any and all other support facilities for shipping and transportation in Panama. The current worldwide credit crisis will right itself and the Taiwanese Container Terminal at Colon will be ready.

Real Estate Investment in Panama

Investment in residential real estate in Panama has had a good run in the last decade. So has investment in commercial real estate. Now that North Americans are dealing with credit issues investment in the high end of the residential real estate market is in a pause. However, the wise know that business cycles come and go. Residential real estate will resume its climb. Commercial real estate investment, on the other hand, is less dependent upon the bank accounts of North Americans. Panama’s small business community is thriving. Panama’s middle class is growing and becoming wealthier. In this economic activity there is lots of room for investment in commercial real estate.

Come to see us at ABPanama. We have over 23 years experience managing real estate portfolios and can help you find both residential real estate and a targeted commercial real estate investment in Panama’s thriving economy.