The Panama Canal authority says it expects revenue to drop by about €182 million in the next fiscal year, a shipping crossings are impacted by the ongoing drought.
ADVERTISEMENTThe Panama Canal, one of the world’s busiest maritime trade passages, is facing tough times.
Ships move through the canal via a system of locks that use water from several freshwater reservoirs to float the massive cargo vessels overland.
But an unprecedented regional drought has forced its administrator to impose surcharges and weight limits on ships traversing the transoceanic waterway.
When it operates at full capacity, about 36 to 38 ships transit it daily. But the canal authority says this will likely drop to around 30 and 32 ships as it continues to roll out water efficiency measures.
As a result, it expects the waterway’s revenue to shrink by about €182 million in the next fiscal year, which starts in October.
And there are fears things may deteriorate further. As the region experiences an extended dry season, authorities say the start of El Niño weather phenomenon could worsen conditions.