Credit crunch casualty

Following a protracted legal action which resulted in a decision in October 2007 to allow the Government to continue with the bidding, Maersk and PSA International withdrew from the process. This left Cosco Pacific and Ports America in the running which then formed a joint venture to pursue the matter. Discussions began in May 2008 and until recently were still ongoing.

According to Ports America, if it could have reached reach an agreement with the government this year and commodity and fuel prices stabilised it hoped to commence construction in 2009 and reach full operations by 2014, to coincide with the completion of the Canal extension.

Unfortunately, in the last few weeks following the unprecedented amount of credit market and commodity price turmoil, Ports America has decided to forgo the project for the time being and it now seems that if the Government of Panama wishes to pursue the matter directly with COSCO it is now free to do so. To date COSCO has made no statement regarding its intentions.