Voters OK $5.25 billion Panama Canal project

PANAMA CITY, Panama – Voters overwhelmingly approved the largest modernization plan in the 92-year history of the Panama Canal on Sunday, backing a multibillion dollar expansion that will allow the world’s largest ships to squeeze through the shortcut between the seas.

More than 78 percent of Panamanians voted in favor of the expansion with 94 percent of polling stations counted by the country’s electoral tribunal. Only about 22 percent opposed the plan. Almost 57 percent of the country’s more than 2.1 million voters did not turn out.

Thousands of supporters in green “Yes” T-shirts cast ballots endorsing the $5.25 billion overhaul, which would allow the canal to handle modern container ships, cruise liners and tankers that are too large for its current 108-foot-wide locks. The plan is to build a third set of locks on the Pacific and Atlantic ends by 2015.

The Panama Canal Authority, the autonomous government agency that runs the canal, says the project will double capacity of a waterway already on pace to generate about $1.4 billion this year. Expansion will be paid for by increasing tolls and will likely take in more than $6 billion annually in revenue by 2025.

The canal employs 8,000 workers and the expansion is expected to generate as many as 40,000 construction jobs. Unemployment in Panama is 9.5 percent, and 40 percent of the country lives in poverty.

Critics contend the expansion will benefit the canal’s customers more than Panamanians, and fear it will stoke corruption and uncontrolled debt if costs balloon.

President Martin Torrijos, an outspoken supporter of expansion, called the referendum “probably the most important decision of this generation.”