News

The Panama Canal generated $3.45 billion in profit in its recently completed fiscal year, a 9.5% increase from the previous year, despite drought conditions that limited the number of ships passing through the famous waterway.

Canal operators could reduce operational costs by 5%, while revenue increased by $18 million to $4.99 billion, the authority’s vice president of finances, Victor Vial, told journalists.

While the results may seem like nothing more than an economic indicator, property buyers should pay attention. The Canal is a key driver of Panama’s economy and its continued strength is one reason the country is on solid financial footing, year after year. Even as Panama’s economy diversifies and grows, the Canal provides the consistency and resiliency that few other countries can claim.

The drought was a major issue for the Canal. It was the third driest year in the canal’s history, which reduced the water available to operate the locks. In response, the Canal Authority was forced to cut the number of ships authorized to pass through the Canal.

Restrictions caused long delays, and some vessels sought alternative routes. According to Reuters coverage, the waterway handled 423 million tons of cargo through its locks and saw the passage of 27.3 ships per day on average, down from about 36 the previous year. 

However, operators still managed to increase revenue as the Canal remains an essential shipping route. The Canal is adding incentives for some vessels to return, including bulk carriers and liquefied natural gas tankers, while advancing $8.5 billion in projects for the next seven years including new infrastructure, Reuters reports. 

“Our financial strategies are complemented with environmental initiatives,” said the canal’s chief, Ricaurte Vazquez, in a release. “This secures our operational resilience.”