Traffic in Panama Canal further slashed

PANAMA CITY

A severe drought that began last year has forced authorities to slash ship crossings by 36 percent in the Panama Canal, one of the world's most important trade routes.

The new cuts announced on Jan. 17 by authorities in Panama are set to deal an even greater economic blow than previously expected.

Canal administrators now estimate that dipping water levels could cost them between $500 million and $700 million in 2024, compared to previous estimates of $200 million.

One of the most severe droughts to ever hit the Central American nation has stirred chaos in the 50-mile maritime route, causing a traffic jam of boats, casting doubts on the canal's reliability for international shipping and raising concerns about its affect on global trade.

Panama Canal Administrator Ricaurte Vásquez said they would cut daily ship crossings to 24, after already gradually slashing crossings last year from 38 a day in normal times.

Vásquez added that in the first quarter of the fiscal year the passageway saw 20 percent less cargo and 791 fewer ships than the same period the year before.

Canal authorities attributed the drought to the El Niño weather phenomenon and climate change, and warned it was urgent for Panama to seek new water sources for both the canal's operations and human consumption.

The same lakes that fill the canal also provide water for more than 50 percent of the country of more than 4 million people.

“The water problem is a national problem, not just of the Canal,” Vásquez said. “We have to address this issue across the entire country.”