PIANC Panama - Agenda

The Transportation Infrastructure and Cargo Logistics Master Plan for the Interoceanic Zone of the Panama Canal is the first integrated transportation infrastructure and cargo logistics planning effort in the country commission by the Panama Canal Authority. The need for this master plan was identified in 2015 ´by the Logistics Cabinet´s Infrastructure Committee, which is a part of the Logistics and Competitiveness Secretariat of the Ministry of the Presidency.

This committee is currently headed by the Panama Canal Authority and is composed of public institutions and logistics representatives from the private sector. The document was developed through a consultancy project and in close collaboration with the National Logistics Strategy, led by the Logistics Cabinet.

The objective of this Master Plan is to generate long-term, sustainable conditions for the development of Panama as a global logistics hub, by determining priorities for investment in freight infrastructure in order to provide better integration, optimizing the existing infrastructure and generating opportunities to capture new cargo segments with appropriate value-added logistic services, and ensuring the preservation of environmental resources and public and urban spaces within the Interoceanic Zone of the Panama Canal.

Through interinstitutional consultation, relevant databases were obtained from various national agencies, as well as relevant information from project developers and stakeholders within the zone[1] During the formulation, the study was continuously validated through four workshops, a focus group, direct and indirect interviews, and field surveys with stakeholders.

The methodology was divided into four stages. The first stage consisted of an assessment of the current condition of the hub, in order to complete a gap analysis. For this, information was gathered from physical and digital inventories, interviews, secondary information and various databases.

The second stage involved the development of a multimodal transportation and logistics model that comprises Panama´s intermodal cargo flows data from 2006-2015. It also includes an Excel costs and time model for the main logistics chains analyzed. This component captures the key elements that comprise the relevant logistics costs associated with the transport of each product segment through the study area on the main transportation modes. The model also includes a market demand module that summarizes the forecast of demand for the major market segments over the time period of the analysis. This analysis is based primarily on the assessment of a base year demand, which is derived from data obtained from each of the modal options.

Demand is organized by product segment, zone of origin and destination. For future forecast years, demand matrices are estimated based on establishing causal relationships between base demand and key “drivers” of demand. Potential drivers include mainly macroeconomic growth rates by country as a qualitative assessment of potential cargo flow patterns through the region. IHS and CEPAL[2] projections for containerized and vehicle imports and exports for Latin America were some of the sources used for the short term, unrestricted transshipment forecast. For the long-term forecast, GDP was used as a base, utilizing IHS projections for elasticity. A combined analysis was applied in order to evaluate three potential scenarios for cargo flows within the hub. This allowed the identification of future transportation infrastructure needs, as well as the actions required to attract potential market segments that could benefit from VALS (Value Added Logistics Services). Finally, this analysis, along with the benchmarking of seven international logistics hubs, were utilized to establish five strategies, based on international best practices, that support the action plan.

Along with the action plans, an inter-institutional cooperation scheme analysis based on international case studies and local consultation aided in the development of proposals for inter-institutional cooperation schemes at a strategic and operational level. Legal, institutional and financial mechanisms are presented to streamline the execution of mega-infrastructure projects and aid the development of VALS in new logistic segments.

This national integrated initiative provides defined actions for the short, medium and long-term planning of transportation infrastructure and logistics. This initiative is based on quantitative and qualitative analyses, with the purpose of meeting future needs of both logistics projects and cargo demand flows by taking a proactive role. The recommendations contained in this study have been included as one of the pillars of Panama´s National Logistics Strategy, recently launched by the Logistics Cabinet.