Panama president seeks international help over Panama Canal expansion troubles
Panama's president Ricardo Martinelli says he will travel to Italy and Spain to seek their help in resolving a US$1.6 billion dispute that is threatening to halt the Panama Canal expansion project.
Jamaica is banking on the expansion of the canal due for completion next year, to realise its own Logistics Hub project expected to bring significant investments.
The association of companies responsible for most of the expansion issued an ultimatum on Wednesday giving the Panama Canal Authority 21 days to pay for a cost overrun.
The alleged cost overrun is roughly half of the $3.2 billion-bid that won Grupo Unidos por el Canal the contract to build a third set of locks.
The group includes companies from Spain, Italy, Belgium and Panama.
However, the Panama Canal Authority has hit back, saying the companies are responsible for the extra costs.
President Ricardo Martinelli says Italy and Spain have a moral responsibility to help resolve the dispute between the companies and Panama.
He says it is not possible for a company to just announce an enormous amount of cost overruns, when they had already fixed a price.
Officials say the overall expansion work is 72 per cent finished.
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