Investment in The Panama Canal and the Panama Canal Expansion Project

Already one of the engineering marvels of the world, the Panama Canal is undergoing a facelift. This lake-and-lock-type canal stretches for nearly 50 miles from Panama City on the Pacific Ocean to Colon on the Caribbean Sea, and ultimately, connecting to the Atlantic Ocean. For travelers and produce carriers bound for Japan from the East Coast of the United States save about 3,000 miles by going through the Canal; ships sailing from Ecuador to Europe save about 5,000 miles.

The citizens of Panama voted in October 2006 to authorize the Panama Canal Authority to implement a $1 billion investment in the Panama Canal, improving and expanding the Canal while allowing for two-way traffic of even the largest ships. This plan will widen the narrow Gaillard Cut, add a third set of locks and two new bridges. In addition, the ports on both ends of the canal are undergoing expansion, with a new port being created on the Pacific side. These improvement plans are expected to take ten years and will provide excellent opportunities for investment in the Panama Canal. The expected investment opportunities in the Panama Canal include:

1. Development of major multi-mode transportation and logistics centers at Colon and Howard/Farfan, and a new container port at Farfan. These centers represent significant investment options in the Panama Canal.
2. Ship owner services, servicing of vessels, maintenance and repair and container repair.
3. Construction of a third set of locks, necessitating additional water resources, expansion of the entrances to the Canal, and deepening of Gatun Lake and Culebra Cut.
4. Services related to the operation of the Panama Canal.
5. Provisionary services for the ports. (including fuel, power, material, banking and food) Already a multi-million dollar industry, expansion of the Panama Canal makes this investment opportunity a potential bonanza.
6. Services related to passengers and crew transiting the Canal.
7. Cruise ships and related tourism.
8. Relocation of 8,000 to 10,000 homes due to the expansion project. This will involve homebuilding in the relocation effort and provide an excellent, indirect investment in the Panama Canal.

These improvements and changes will not only transform the Canal, but they will bring a massive influx of investment dollars into the Panama Canal region. Such a move will no doubt attract foreign investors and the government of Panama is prepared to respond to such an influx. Panama has laws in place which are very accommodating to foreign investor, providing provisions for residency as well as tax shelters. In addition, investment in the Panama Canal is an excellent opportunity for retirees looking for an investment opportunity to coincide with their retirement destination.

Not only is it the home of the Panama Canal and its investment potential, Panama an excellent retirement destination in its own right. The country has the second largest banking center in the world, amazing benefits for “pensionados” (retirees), incredible scenery and wildlife, and spectacular weather. The currency used is the American Dollar, the time zone is the same as New York City (minus Daylight Savings Time), and the cost of living is surprisingly low. The investment opportunities of the Panama Canal may bring in the money of someone looking for a business option, but all of the other benefits may be the things that keep them in the country forever.

For more information about investing opportunities in Panama, such as hedge funds or Panama real estate contact us to request further information.