Mediation from the Spanish Public Works minister has resulted in some progress being made in the dispute between Panama and the consortium it hired to upgrade the country’s famous canal.
Ana Pastor met President Ricardo Martinelli and members of the Grupo Unidos por el canal or GUPC consortium of local, Spanish, Belgian and Italian builders.
The project is nearly 1.2 billion euros over budget and the companies had been ready to down tools unless they were assured not to pick up the tab. All parties have now agreed to abide by the written disputes procedures in their signed contract, and not to let their conflict go beyond those terms of reference.
“The Spanish government, all the world’s governments want the canal to be expanded according to the terms of the contract, because as you know a lot of ships are being built of ever-bigger capacity,” said Panamanian President Ricardo Martinelli.
The Spanish government has ruled out helping its lead builder Sacyr, itself laden with debt, but the consortium is blaming a botched geological survey carried out by the Panamanians for the cost overruns.
However some are pointing at the builder’s 2009 bid, which was more than 700 million dollars lower than the reference budget.