As the global shipping industry facing tough weather, the $5.25 billion expansion of the Panama canal is set to open Sunday (June 26), reports AP.
The deeper, wider channel is designed to accommodate the world’s growing fleet of mega cargo ships and expanding trade between North America and the Far East.
When the project opens, it will nearly triple the capacity of the original canal, allowing ships carrying up to 14,000 containers a quicker path between Asia and the USA.
About a third of the canal's traffic is between U.S. East Coast ports and northern Asian ports. But that cargo traffic dropped 10.2 percent in 2015, and lower oil prices have allowed some shippers to use longer routes.
Canal authorities estimate the expansion, called Panamax, will cut global maritime costs by an estimated $8 billion a year by enabling companies to pack more goods onto fewer ships. About 5 percent of the world’s total cargo volume currently moves through the canal.
The drop in world oil prices, an economic slowdown in China and other factors have been affecting the canal's traffic and income.
It took 40,000 workers nearly 10 years to dig the new access lane to the Panama Canal, a massive engineering feat that rivals the canal’s initial opening 102 years ago and which could potentially reshape the way goods move around the globe.