- Associated Press - Monday, March 14, 2011

BOGOTA, Colombia | This nation that lost its isthmus to U.S.-backed separatists a century ago has long dreamed of creating an alternative to the Panama Canal, which has given its neighbor so much strategic heft and wealth in shipping tolls.

So when President Juan Manuel Santos recently said Colombia and China were working on building a “dry canal” to connect the Pacific Ocean and Caribbean Sea by railway, Colombians wondered: Is it for real? Or is it just another of many pipe dreams to rival Panama’s crossing?

In an interview with the Financial Times last month, Mr. Santos called the plan “quite advanced.”

What he did not explain is that the plan remains largely conceptional, senior government officials, Chinese diplomats and industry authorities told the Associated Press.

In a recent interview, Transport Minister German Cardona called the proposed railway “a rough draft … an idea” floated by the Chinese four or five months ago.

He said he is also unfamiliar with a project Mr. Santos mentioned in a New York Times interview published this month to build a related city for 250,000 people on the Caribbean coast.

Another senior government official, speaking on the condition of anonymity because the official was not authorized to discuss the matter publicly, told the AP the entire railway scheme is at this stage “a Chinese story,” a Spanish idiom for a “tall tale.”

No letter of intent has been signed, and there are serious doubts it would be environmentally wise or economically feasible to construct a railway through or near the Darien Gap — swamp-laced virgin jungle where leftist rebels still roam.

According to Mr. Santos, China’s railway engineers intend to connect an unspecified Pacific port to the new city to be built near Cartagena. There, the Chinese would assemble products to be sent to the United States and elsewhere. The trains would carry back Colombian coal and other China-bound raw materials.

The executive director of Latinports, an association of more than 20 port authorities in the Americas, said he has only heard about the project from media reports.

“What we don’t know is how real this is,” said the official, Julian Palacio.

Or how feasible to think it could compete with the Panama Canal.

The general manager of the port society of Buenaventura, Colombia’s only major Pacific port, Domingo Chinea, said it is “a joke” to think a rail line could compete with the Panama Canal.

Transporting by rail the cargo that a single ship can bear across the Panama Canal would require about 80 train trips, he estimated. Plus, Buenaventura can only handle ships of up to 40 tons — compared to the 100,000-ton vessels that can move through Panama.

Whether or not Mr. Santos is sincere, Heather Berkman, a Latin America analyst with the Eurasia Group, says it smacks of political brinkmanship.

Colombian frustration over the U.S. Congress’ failure to ratify a free-trade deal is growing. And few things rattle congressional nerves like the threat of losing more trade and investment opportunities to China.

Mr. Santos‘ statement was, Mr. Berkman said, “only natural as a political strategy to pressure the U.S. Congress: ‘If you’re not here, then China’s going to come and start building things, and we’re going to do more trade with them.’”

The U.S. government response has been muted. Asked for reaction, the U.S. Embassy in Bogota said it was aware of the reports, and “We look forward to learning more about this project.”

The Chinese Embassy’s commercial counselor in Bogota, Zhou Quan, said the railway project is in its formative stage and is among several proposed projects in Colombia being considered by China’s state rail-construction company.

“There is a project for a railway that connects the Atlantic coast of Colombia with the Pacific coast, but the fact is that they [Chinese agencies] are still discussing it,” he said.

The idea of alternatives to the Panama Canal is not new. But none has proven worthwhile to investors.

Guatemala, Honduras and Costa Rica each have considered the idea. Nicaragua repeatedly has announced plans for a rail, road or even water link. And Mexico has been working on the idea since the mid-19th century.

In the 1990s, Colombian President Ernesto Samper floated a plan for an interoceanic canal that quickly evaporated. Critics said he was trying to divert attention from having received campaign funds from drug traffickers.

Colombian proposals have never solved the matter of the Darien Gap, a region so wild it is the one missing link in the Pan-American Highway. It also is home to the Los Katios National Park, a 278-square-mile preserve that is a UNESCO world heritage site.

“The region is swampy, and where the land is firm it is, in many places, covered by 10 meters or more of vegetation,” said Jose Fernando Isaza, a former minister of public works and transport.

Alberto Aleman, the Panama Canal’s administrator, meanwhile, questioned why anyone would invest in a costly alternative, given the canal’s success and current expansion.

He says a $5.3 billion project to widen the 55-mile-long waterway, expected to be ready in 2014, will double its commercial cargo capacity to 600 million tons a year.

Salomon Kalmanovitz, dean of the economics faculty at Jorge Tadeo Lozano University and Colombia’s former chief central banker, called any “dry canal” plan untenable.

Panama, he said, remains the lone option for good reason: “No alternative to the canal is profitable.”

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