Panama Rises
The Central American nation, now celebrating its centennial, has come into its own since the United States ceded control of its vital waterway
- By Bob Cullen
- Smithsonian magazine, March 2004, Subscribe
(Page 3 of 9)
We talked, in fact, on a golf course near the Continental Divide, not far from a cemetery that contains the mossy tombstones of Frenchmen who died attempting to build the canal. It is off a potholed road near the Trans-Isthmian Highway that links Panama City, on the Pacific, to Colón, on the Atlantic. Along the road, exhaust-spewing trucks rumble through villages of concrete homes painted in pastel shades of green and yellow. Young girls in plaid skirts walk to and from school. Egrets can sometimes be seen flying over the highway.
The golf course was built in the 1940s and 1950s for canal personnel. It has recently been refurbished by a Panamanian businessman and opened for public play. It’s a hilly course with holes bounded by tropical forests and head-high elephant grass. Howler monkeys could be heard in the trees as we played our shots. Alemán Zubieta said that when he was a boy, the only way he could play this course was to pretend he was a caddie and participate in an occasional caddies’ tournament. When I asked him how the canal was doing, he rattled off statistics like a salesman giving a presentation: “One measure of quality is the average time, including waits at the entry points, that a ship needs to make the crossing,” he said. “In 1996-97, we were about 32 hours on average. Today we are below 24.”
The canal operated in both 2001 and 2002 with only 17 accidents per year in a total of more than 26,000 transits— the best safety record in its history. In the four years since the turnover, total employment has gone from more than 10,000 workers to between 8,000 and 9,000, with claims of greater efficiency.
Panamanians have installed computerized navigational and tracking devices that enable canal officials to follow every vessel in the canal. They have also accelerated the pace of maintenance in the Gaillard Cut, which requires constant dredging because the soil on either side is unstable and prone to mud and rock slides, especially during the long rainy season. The dredging has widened the cut by some 120 to 200 feet since the treaties were signed a hundred years ago. Panama expects to be able to allow 24-hour two-way traffic in the cut soon, even with vessels the size of the Falstaff. (At present, the biggest ships transit at different times. Atlanticbound traffic might go through the cut in the morning, Pacific- bound traffic in the afternoon.) On top of all that, Alemán Zubieta told me, the canal has managed to double the annual payment it makes to the government of Panama from $135 million in 1999 to $270 million in 2002.
But the canal is not a spigot that spits out money. The Panamanians are, in Alemán Zubieta’s words, “constrained by the market.” Tolls have been raised four times since the turnover (the Falstaff paid more than $143,000 for its transit), but if tolls get too high, shippers might choose to go through the Suez Canal or unload containers on either coast of the United States and ship them onward by rail. Thus, if Panama wishes to grow its economy, it must look beyond the canal.
As if to underscore the point as I spoke with Alemán Zubieta on the golf course, a train chugged by on the Panama Canal Railway, pulling open carriages, each laden with two truck-size containers. Completed in 1855, it once shuttled prospectors en route to the California gold fields across the isthmus. More recently it has proved a training ground for Panamanians in managing assets transferred by the United States. Their record after the 1979 takeover was not encouraging. The railroad became a fiefdom of the military, which at that time controlled the country. (Strongman Manuel Noriega, who was removed by American troops in 1989, was convicted in 1992 of six counts of racketeering, drug trafficking and money laundering. He is currently serving a 40-year sentence in a federal prison in Miami.) Track and rolling stock deteriorated for lack of maintenance, and the payroll was bloated with politically connected employees who did little more than collect checks. By the 1990s, the railroad was unsafe, ran few trains and required millions of dollars a year in government subsidies.
In 1998, the Panamanians tried another approach—privatization and foreign management. The government granted a 50-year concession to operate the railroad to a joint venture created by the Kansas City Southern Railroad and Mi-Jack, an Illinois company that manufactures freight-handling equipment. The new venture has rebuilt tracks, renewed rolling stock and improved freight carriage. Recently it bought and refurbished six passenger cars, including a glass-roofed 1938 Southern Pacific observation car, which had been serving as an ice-cream parlor in Jacksonville, Florida. The observation car now has air-conditioning, mahogany paneling, leather seats and wall-to-wall carpeting.
The passenger train, which leaves Panama City at 7:15 a.m., permits passengers to see a cross section of the country. Pulling out of the station, you can see remnants of the old Canal Zone, row after row of precisely positioned buildings, formerly used as offices and barracks. They are now given over to a variety of uses, but still testify to the American military culture that built them. Next comes a district of blocky, concrete structures with patchy lawns and low palm trees. Once housing for American administrators and technicians, they are now sold on the open market for about $100,000.A few minutes later, the train slips into a rain forest. Trees crowd the tracks. Heron take flight over algal ponds. GatunLake appears on the western side of the track, freighters churning through it. Within an hour, the train enters Colón, the country’s chief Atlantic port. Laundry flaps from clotheslines and paint peels in trackside neighborhoods. The only thing gleaming in Colón is the sweat on the backs of its inhabitants.
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