Monday, January 6, 2014

Panamá: Update--Spanish Development Minister Flying to Meet with President Martinelli

According to Spain’s El Pais, Panama Canal Authority (PCA) administrator Jorge Quijano said in an interview published on Sunday (January 5) that those in charge of the $5.25 billion expansion of the Central American nation’s inter-oceanic waterway are “prepared to be a little aggressive” and added that the project will be completed “as soon as possible.”

“We’re not going to sit here waiting for time to pass” without reacting after the consortium undertaking the expansion announced that it will suspend work if a cost overrun of some $1.6 billion is not acknowledged.”

The GUPC consortium (Grupo Unidos por el Canal), led by Spanish construction giant Sacyr Vallehermoso and including Italian firm Impregilo, Belgium-based Jan de Nul and Panamá’s CUSA, formally advised the PCA on December 30 that it would suspend work in three weeks if the authority does not agree to pay an additional $1.6 billion to finance cost overruns.

COMMENT: “With a stoppage there are going to be some additional delays,” Quijano said, but he added that he was confident about being “sufficiently agile ... so that, in the worst case, the project will be able to be resumed and completed.”

Quijano said that the PCA had been “faithful to the contract” and had “paid religiously, so that the contractor may have a cash flow and continue with the work.”

Spanish Development Minister Ana Pastor is on her way to Panamá, where she is scheduled to meet on Monday (January 6) with Panamanian President Ricardo Martinelli to seek a solution to the conflict.

Pastor scheduled the trip to Panamá after Martinelli announced last Friday (January 3) plans to travel to Spain and Italy to demand of their governments that the companies from their respective countries fulfill the terms of the original contract.