News
Thursday 18th January 2024.
January 17, 2024
The income of the Panama Canal will decrease between 500 million and 700 million dollars due to the restriction on transits and fewer resources that it will receive from tolls from ships that use the route.
This was reported by the administrator of the Panama Canal Authority (ACP), Ricaurte Vásquez, who explained that a reduction of 200 million dollars had been estimated, but given the increase in restrictions due to the prolonged dry season that has affected the level of the algos, a further reduction is now projected.
“I am not sure that the loss of that income can be corrected in another way, because to the extent that auction prices decrease and the number of vessels is lower, the income is not recovered,” explained the ACP administrator.
He reiterated that the Channel is not transactional and maintains long-term relationships with customers. “It doesn’t seem reasonable that a long-term business relationship would take advantage,” she said of a question about whether costs would rise further to offset the drop in revenue.
The number of transits through the Canal has been progressively reduced to 24 ships per day that currently pass through it daily. The administrator did not rule out that it could be reduced further if the water situation worsens, and it does not rain between April and May of this year.
Regarding the reliability or not of the route, he said that reliability has been demonstrated, but he said that it is not surprising that others intend to capture part of this route and the market.
“We believe that in general terms we must comply with our budget,” he said.
The Canal administrator stressed that the Canal does not have authority over the entire basin and the hydrographic account is not the property of the Canal.
He said that the Canal’s approach to the Executive is to delimit, define and expand the Canal’s account. He maintained that the decision to build a new reservoir on the Indio River is in the hands of the executive.
“The issue of water is a national issue and not only of the Canal and it does not apply only to Panama, but this issue must be faced throughout the entire country,” said Vásquez.
“It would certainly help a lot if the restriction by law that the Panama Canal has on building a reservoir is eliminated,” added the Canal administrator.
He argued that sooner or later, “in this decade or the next the Panamanian population is going to need more water.”
Vásquez reported that if it is up to the Canal to build the Indio River, they have the resources to do so. “The issue is when that decision is made. If the responsibility lies with the Channel, we will make a decision to develop a collaboration with the community. The Panama Canal talks to communities door to door,” he said.
Minera Panamá , a subsidiary of the Canadian First Quantum Minerals, reported that on Tuesday, January 16, it delivered the maintenance and management plan that the Ministry of Commerce and Industries (MICI) had required.
In a two-page statement, the company listed the points contained in the plan.
The company highlighted that the execution of the document will depend on the source of financing, but it did not make clear whether it will provide the funds or if the Government will have to finance the work , after the Supreme Court of Justice declared the contract unconstitutional, in a ruling issued last November 28.
“The activities contemplated in the plan entail costs that are estimated in tens of millions of dollars per month and require sources of continuous financing that must be defined in a timely manner to guarantee the objectives and sustainability of the plan,” the company indicated.
In a preliminary report on 2024 projections, First Quantum indicated that the mine preservation and safe management program would cost between $15 million and $20 million per month, but added that everything will depend on the activities carried out.
To carry out the maintenance tasks, Minera Panamá indicates that it will be necessary to maintain a workforce of 1,400 workers , a number that would decrease as the phases of the closure plan are completed, which would focus on the maintenance of the main pit to avoid erosion. as well as in the care of 215 tons of supplies that were used to carry out the explosions.
The First Settlement Court for Criminal Cases has ordered the accumulation of investigations related to the alleged irregularities in the construction of the corridor via Brazil, section I and section II, the execution of which was assigned to the Spanish company Fomento de Construcciones y Contratas (FCC) by an amount of $455 million.
Initially, the court had scheduled the preliminary hearing for the former Minister of Public Works, Federico Suárez , and six other people for alleged embezzlement in the case of the corridor via Brazil phase I. However, Suárez’s defense and other lawyers requested the accumulation of both processes.
Judge Agüeda Rentería agreed to the request, determining to hold a single hearing that covers both cases on September 3, 2024.
In addition to Suárez, this case includes as defendants the former MOP contract director, Jorge Churro Ruíz, Juan Vásquez, María González, León Emilio Halphen, Héctor Castillo and Sergio Fernando Del Sour.
Between 2009 and 2014, the Spanish company FCC carried out the construction of the corridor via Brazil, sections I and II. However, the Comptroller General of the Republic detected overpricing in the works.
According to the audit reports of the Comptroller’s Office, the corridor via Brazil phase I presented overpricing in the amount of $70.6 million and $41.8 million, respectively.
The Supreme Court of Justice (CSJ) did not admit an injunction of constitutional guarantees filed by Iván Arturo Arrocha , sentenced to 70 months in prison for laundering money to acquire the shares of Editora Panamá América, SA (Epasa) , in the so-called New Business case .
The decision was adopted on January 12, but was disclosed this January 16 through Edict 51, through which the Secretariat of the Court notified the parties.
The appeal was presented after last October 24, the Superior Court for the Settlement of Criminal Cases confirmed the sentence handed down last July by criminal judge Baloisa Marquínez , against former president Ricardo Martinelli , Daniel Ochy , Janeth Vásquez Sanjur , Valentín Martínez Vásquez and Arrocha.
Arrocha, who was vice mayor of the district of Panama, was convicted of having managed the delivery of an advance of $600,000 to the Condotte Panama company for the construction of the Colón Sports City. That money ended up in a basket account in the name of the company New Business Services , used to acquire Epasa shares in December 2010.
In this case, the Criminal Chamber of the Court is pending to resolve an appeal for cassation presented by the lawyers of Martinelli and others convicted.
The construction sector began the year 2024 with invoices receivable from State contractors who have pending payments from public institutions for works and infrastructure for more than 200 million dollars.
The Government’s debt with State suppliers as of March 2023 was 90% paid and to date new debts have been added that reach more than 200 million dollars, said the president of the Panamanian Chamber of Construction, Alejandro Ferrer Solís who took possession of this union on Tuesday, January 16 and replaced Carlos Allen, who was in office for two years.
“We will insist on the timely compliance of the obligations that government entities maintain with the contractors who are members of Capac, whether they are accounts for progress of work, amounts withheld or other obligations derived from contracts signed with the State,” he said.
He added that one of the key issues is the need to reduce excessive bureaucracy in the procedures for starting construction projects, obtaining construction and occupation permits.
“In a very particular way, we will work to achieve transparency and comply with the principle of free competition in the selection processes of contractors in charge of the execution of public works,” said the president of Capac.
Although Panama companies’ personnel hiring expectations have been reduced compared to the first quarter of 2022, they remain positive.
At least 42% of companies indicated that they intend to increase their workforce between January and March, according to the employment expectation survey by the consulting firm ManpowerGroup Panama. Although this study was done before the new minimum wage increase of 4.5% for small and medium-sized companies and 6% for large ones was announced.
“For the first quarter of 2024, 8 of the 9 sectors predict positive hiring intentions and 3 of the 4 regions anticipate an increase in staffing levels,” highlighted Claudia Escobar Casillas, Country Manager of ManpowerGroup Panama.
The survey reveals that the net employment trend was 27% in this first quarter and also indicates that 37% of companies expect to maintain the same number of employees, while 17% admitted that the number of employees will decrease.
Compared to the last quarter, there was a reduction of -8 percentage points (35%) in hiring intentions and a decrease of -18% compared to the same period in the first quarter in 2023 (45%).
The sector with the best expectations of increasing personnel hiring is manufacturing with a perspective of 37%, which represents 10 percentage points from the last quarter but also 10 points below from January to March 2023.