Panama predicts '14 to have 7-percent economic growth
July 23, 2014, 12:15 am TWN
PANAMA CITY--Panama's economy will grow by as much as 7 percent this year, thanks in large part to revenue from its signature inter-oceanic canal, officials said Monday.
The Central American nation's coffers get an injection of about US$1 billion every year from the canal, according to the Economy Ministry, which said that the revenue helps buoy the local economy.
Officials said they expect growth of between 6.5 percent and 7 percent for 2014.
Foreign investors also have been betting on Panama and its canal, investing US$15 billion over the past five years alone, the ministry said.
The small nation — population 3.8 million — chalked up 8.4-percent growth in 2013.
Completing the widening of the waterway — a massive project which is a year behind schedule and has been mired in controversy — tops new President Juan Carlos Varela's agenda.
The vast construction project was to have been completed this year, but delays and cost overruns have pushed back the schedule to early 2016.
The 80-kilometer (50-mile) canal was completed by U.S. interests in 1914 to provide a much shorter, safer route between the Atlantic and Pacific.
Work to expand it was interrupted earlier this year over a dispute about who would pay for an estimated US$1.6 billion in cost overruns.
And Monday, workers walked out at one part of the widening work, seeking a raise, a union leader said.
Construction workers' union chief Abelardo Herrera said no progress had been made yet in negotiations.