Train to cost same as the Panama Canal Expansion
Results on the feasibility of the train will be known in a year. A project that will be studied by the current administration and would be developed by the next government.
The diplomatic relationship between Panama and China would be fused with this project that would cross the country with a cost equal to the expansion of the Canal.
Panama is studying with China the construction of a train that would depart from the capital city and reach the province of Chiriqui, connecting the country with Costa Rica.
Given the limited information on the project, executives linked to the logistics sector are prudently silent, although they say that the real demand should have already been identified, and then, with the feasibility study, determine to the millimeter the convenience or not of the train.
The study will be done by the People’s Republic of China, the same country that could finance the work.
The feasibility analysis is estimated by China at a cost of $ 16 million. The government of President Juan Carlos Varela said the disbursement is part of the non-reimbursable cooperation agreements signed in November 2017, after Panama restored diplomatic relations with the Asian giant.
"If this study determines that construction is feasible, it would move to a new stage where it would negotiate possible financing, the participation of companies and the use of Chinese technology," responded the Ministry of Foreign Affairs, confirming that Beijing would be in several phases of the project.
The train will not be free and Panama will have to find financing and payment methods. The method of contracting the company for the design and construction of the work will be a key factor. At this time, everything depends on the feasibility study,
"What is important to emphasize is that the hiring of the company for a possible design and construction will be defined through transparent processes and within the framework of Panamanian legislation," added the Foreign Ministry.
The Executive warns that "taking into account that we are still in the feasibility studies phase, we can not give details of the cost. However, the figure of $ 5 billion is an approximate technical amount, taking into account the mileage and that it would be freight train which would include passengers. "
The Government argues that the train would represent an efficient and sustainable passenger and cargo mobility system. In addition, it would provide an unprecedented connection in the country, contributing to its regional integration.
"The objective is to connect the productive areas with the main ports of Panama, those with the highest flow of cargo, which would significantly improve the inter connectivity of the logistics platform," the Foreign Ministry responded through an email.
For this to happen, however, mechanisms must be found to strengthen the export capacity in the producing areas, presently marked by inefficiency and lack of skilled labor. The train could reach the border in a few hours, but the merchandise will the need to be transferred to another transport system in an efficient way to be effective.