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Turmoil in Panama - Navigating Crises at the Canal

March 20, 2025

Panama's famous canal connects the Atlantic and Pacific Oceans. But, this important gateway for world trade is increasingly blocked.

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Turmoil in Panama - Navigating Crises at the Canal
Image: Java

Cargo ships often have to wait weeks for passage, because water levels in the canal are too low. The cause? Drought.

Turmoil in Panama - Navigating Crises at the Canal
The Panama Canal is an artificial waterway around 82 kilometres long with locks that connects the Atlantic Ocean with the Pacific Ocean for shipping, saving it the much longer and more dangerous journey around Cape Horn or through the Strait of Magellan at the southern tip of South America.Image: Java

Every day, 30 - 40 ships pass through the Panama Canal, carrying one-and-a-half million tons of cargo. The authorities are prepared to do just about anything to preserve the valuable canal. It is, after all, Panama's main source of income.

Turmoil in Panama - Navigating Crises at the Canal
The mainland population of Panama suffers from chronic water shortages. Long periods of drought and the excessive consumption of fresh water for the Panama Canal lock system jeopardise the water supply in large parts of the country.Image: Java

They regularly pump as much water from the country's reserves as possible into the canal. This water is needed to operate the locks. But it is also drinking water, and the population relies on it. For every ship that passes through, 200 million liters of freshwater flow into the sea.

Turmoil in Panama - Navigating Crises at the Canal
Water shortages are becoming a chronic problem for the Panama Canal. Time and again, ships on both sides of the shipping lane have to wait to enter the canal.Image: Java

At the height of the crisis in 2023, over 163 ships had to drop anchor. More and more container ships therefore prefer to bypass the Panama Canal, even if it means taking a long detour. For those in a hurry, there is a solution. The canal authority auctions off emergency passages. These can cost up to 2,5 million dollars, 40 times the normal rate.

Turmoil in Panama - Navigating Crises at the Canal
Every year, hundreds of thousands of refugees cross the country on their way from South America to the USA. Criminal Colombian clans, who ‘organise’ the journey and have turned it into a multi-million dollar business model, are the main beneficiaries.Image: Java

Panama is an important transit route for goods. But it’s also part of a dangerous human migration route. In 2023, half a million men, women and children risked their lives on the waterway trying to reach North America. Despite the risks, more migrants arrive every year.
 

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