Panama: Relieving capital congestion
While the world awaits the completion of the Panama Canal expansion project, work to upgrade transportation infrastructure within the country has quietly continued. The most radical changes are taking place in Panama City, where the construction of a new metro, the discontinuation of the “diablo rojo” bus system and the improvement of several major roads should alleviate congestion in the fast-growing capital. The city has been the focal point of government infrastructure spending in recent years, receiving $2.29bn of the $3.29bn in total investments from February 2009 to February 2013, according to data from the Ministry of Public Works. Spending outside the capital was led by Veraguas with $178.6m, Los Santos ($156m), Herrera ($155.9m), Chiriquí ($148m) and Coclé ($99.8m).
Panama City’s new metro system was identified early on as one of the key projects of President Ricardo Martinelli’s administration. The first line of the network, which is expected to be completed by Brazilian firm Odebrecht in 2014, will feature 13.7 km of track running north-south through the city and require investment of $1.5bn. Plans for four additional lines have also been completed, with initial estimates indicating an additional 20 years will be required to construct all lines. Much of how the finished “Metro de Panama” will look will depend on subsequent administrations.
The metro system is not the only improvement in the capital’s transportation infrastructure, as the bus system discontinued service on March 15. “Los diablos rojos”, as the colourful, converted former US school buses are commonly labelled, have long been considered a danger to the capital’s congested streets. Thus far, some 703 owners of the unauthorised buses have been compensated by the government for relinquishing their buses, most of which will be sold for scrap. Improvement of the capital’s bus system was another campaign promise from the incumbent president.
A new metrobus system featuring nine clearly defined routes will replace the erratic system previously employed. The metrobus, operated by the Panamanian-Colombian joint venture Transporte Masivo de Panama, required an investment of $270m and began operating in 2010. The complete network features 120 Volkswagen-manufactured buses, complete with air conditioning and uniformed drivers who are offered bonuses for accident-free work.
Several other projects that aim to alleviate congestion within the city are also expected to be completed in 2013 and 2014, according to Jaime Ford, Minister of Public Works. Via Brasil, a major artery running through the heart of the capital, is being upgraded at several points such as roundabouts, underpasses and viaducts to improve traffic flow. The upgrades are split into two separate projects that will cost $216.9m and $180.7m, respectively, and are scheduled to be complete by July 2014.
Meanwhile, Avenida Domingo Díaz, another major artery in the capital that connects with the Tocumen International Airport, is being expanded to six lanes. The project, which is expected to cost $237.6m, will also be complete by July 2014. Finally, several roads and public infrastructure within the historic district of Panama City are also being improved at a cost of $175.6m.
Outside of the capital, just $1bn has been invested between January 2009 and February 2013, less than half the amount being poured into improving capital infrastructure. While Panama City has been the focus of investment, there have been several important projects of note in other areas of the country.
For example, the $185.6m expansion of the relatively new Panama-Colon highway was completed in June 2012, which has improved interconnectivity between the two main business centres in the country. Meanwhile, the $80.7m renovation of the Bridge of the Americas, which spans the Pacific entrance at the mouth of the Panama Canal, is expected to be finished in December 2014.
Panama’s status as a major global logistics and transportation centre requires it to build and maintain a modern and efficient domestic infrastructure network to support growing business flowing through the canal, but also to support an expanding domestic market. The improvements being made to the capital are a positive start to modernising transportation infrastructure; however, with tourism, logistics and agriculture each identified as primary growth drivers in the future, improving connectivity outside the capital will be equally important if the country is to maintain the strong macroeconomic growth of recent years.