Panama Canal's 2008 Cargo Won't Grow as U.S. Slows, Chief Says
(Bloomberg) -- Panama Canal traffic probably won't grow this year for the first time since 2002 as the slowing U.S. economy damps demand for imports, the waterway's operator said.
Freight shipped in 2008 will total 312 million tons, the same amount transported last year, Panama Canal Authority Chief Executive Officer Alberto Aleman said yesterday in a Bloomberg Television interview.
``We are going to end the year flat,'' Aleman said.
Aleman's traffic projection reflects the U.S.'s status as the largest customer for the waterway, 9 years after handing over the canal authority to Panama. China is the canal's No. 2 user, the authority has said.
The 50-mile (80-kilometer) canal, which links the Pacific Ocean with the Caribbean Sea, is undergoing a $5.2 billion expansion to handle larger vessels. About 27 percent of the world's container ships are too big for the canal, a figure that will rise to 37 percent by 2011, the authority has said.
Aleman predicted traffic growth may resume next year. The canal shortens the route for Asian goods destined for the U.S. East Coast.
Slumping U.S. import demand this year is being offset by increased exports, creating an ``equilibrium'' that will not harm the canal's finances, Aleman said. Canal revenue will top $1.7 billion this year on higher shipping fees, the ninth straight year of gains, he said.
The U.S. economy will expand at a 1.2 percent annual pace this quarter after growing 3.3 percent from April through June as job losses prompt consumers to pare spending, according to the median estimate of economists surveyed by Bloomberg from Sept. 2 to Sept. 9. Growth will slow to a 0.7 percent rate in the last three months of 2008, the survey showed.
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To contact the reporters on this story: Eric Sabo in Managua, Nicaragua at esabo1@bloomberg.net; Karla Palomo in New York at kpalomo@bloomberg.net
