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The Panama Canal’s extraordinary century

August 12, 2014
  • Thousands of lives lost building the Canal
  • $5.2 billion expansion programme underway
  • History of Canal turned on design, disease, diplomacy

One cannot help but feel that the men and women who built the Panama Canal deserved better.

They had blasted, dredged and dug their way through 80km of rain-sodden, disease-ridden jungle to complete one of the most stupendous feats of engineering the world had seen. 

Up to 30,000 people died in the effort. The canal fulfilled a 400-year-old dream first imagined by Spanish Conquistadores. Its completion heralded the United States as the coming world power. The work was completed on time. 

Yet when the Panama Canal officially opened on 15 August 1914 there was no parade of dignitaries, no flotilla of vessels, no flag-waving crowds. 

Instead a humble steamship, the SS Ancon, puffed its way quietly from Atlantic to Pacific carrying cement, passing through the world’s largest artificial lake unnoticed, and navigating the Culebra Cut, a huge manmade valley blasted through mountains, without fanfare. 

Over in Europe, a war had just started. The world had more pressing concerns. 

Today, more than12,000 ships transit the Canal each year, approximately 3% ($270 billion) of world maritime commerce. That brings in about $1.8 billion in tolls, reports leading marine insurer Allianz Global Corporate & Specialty (AGCS) in a new study Panama Canal 100: Shipping Safety and Future Risks.

But the Canal has long been a tight squeeze; sailors have always joked about greasing the sides of their ships. Nearly half the worldwide commercial fleet is now too large for the Canal.

And so the Panama Canal Authority (PCA) has set about constructing a new set of larger locks, creating a ‘third lane’ which can handle ships nearly three times the size of ‘Panamax’ vessels currently able to transit the Canal. A ‘New-Panamax’ container ship is as long as four football fields.

The new locks will accommodate an extra 12 to 14 larger vessels per day, doubling Canal capacity. AGCS estimates that the value of insured goods transiting could increase by over $1 billion per day.

The wider effect of the Canal’s $5.2 billion expansion programme could be reduced delivery costs as more goods are transported using the larger ships. More cargo may bypass Pacific Coast ports and trans-American road and rail networks, reducing risks if fewer transloadings between ships and road/rail are required. Gulf and East Coast ports are installing bigger container cranes in readiness.

The increased traffic and larger vessels bring additional risks, AGCS warns, which may challenge the Canal’s improved safety record – just 27 “casualties” over the past decade.

And unfortunately, a strike which halted work for several weeks has put back the expected completion date by a year to 2016, according to a new report by Euler Hermes Economic Research

A schematic view inside the Panama Canal and the extensions
A schematic view inside the Panama Canal and the extensions. 

The first attempt to make the dream of traversing the Americas by ship into a reality was made by the man behind the Suez Canal, Frenchman Ferdinand de Lesseps.

A national hero after his Suez triumph, de Lesseps was convinced that he could master the Panamanian jungle in the same way as he had the Egyptian desert – by excavating a giant ditch from coast to coast.

But de Lesseps had never set foot in Panama, nor was he a trained engineer. The Central American rainforest was not Egypt. And after nine brutal years - that cost the lives of 22,000 labourers, mostly to yellow fever and malaria - in 1889 de Lesseps’s company went bankrupt.

Enter US President Theodore Roosevelt, who was convinced that his country’s naval and economic needs demanded a Panama Canal.

He got his way in 1902 (see box: The Stamp that Changed History) and a deal was struck with the Colombian government, which then controlled the region.

The stamp that changed history

Wary of the French failure in Panama, most US lawmakers favored a canal through Nicaragua. Roosevelt argued for the shorter, straighter Panama route which required fewer locks and used the Panama Railroad. An inspired piece of lobbying helped turn the tide in 1902. Philippe Bunau-Varilla, a French engineer, sent a letter to each US senator enclosing a Nicaraguan stamp which pictured the country’s Mt. Momotombo volcano erupting. “An official witness,” he typed on the envelopes, “of the volcanic activity of the Isthmus of Nicaragua”. Nicaragua’s hopes were dashed.

However, Colombian lawmakers balked at the Americans’ financial terms. So Roosevelt declared support for an embryonic Panamanian independence movement, sent in some warships, and in 1903 a bloodless revolution led to Panama becoming an independent republic. The following year work began on the Canal where the French left off. This time better use was made of the Panama Railroad to transport soil away from excavation areas. And a massive mosquito eradication programme was put in place which reduced deaths from disease - this time around 5,000 workers died. At its peak there were over 40,000 people working on the Canal.

In October 1913, US President Woodrow Wilson sent a telegraph signal from Washington DC that ignited an explosive charge which in turn blew open a dam, flooding the Culebra Cut and completing the mission that had consumed so many lives. The following year the SS Ancon made its historic voyage.

“All other things were subordinate,” wrote Rose van Hardeveld, whose husband worked on the Canal. “To see water surging through this yawning canyon, ready to carry ships up and down its mighty locks, was the destiny for which all our days and nights were shaped.”

James Tulloch

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