Panama Canal CEO: Harbors must be deepened; real challenge is roads, railroads

By David Pendered

To the CEO of the Panama Canal Authority, there isn’t a question about the need to deepen the Savannah Harbor, or any other east coast port. All of them should be expanded so their regions can benefit from global trade.

The real question is whether the ports of Savannah, Charleston, Miami, New York, New Jersey and Jacksonville will have the highways, railroads and distribution centers to accommodate cargo delivered to and from the new generation of really big ocean-going vessels, according to Alberto Aleman Zubieta, chief of the Panama Canal Authority.

During a question and answer session after his speech Tuesday at the MODEX 2012 logistics conference in Atlanta, Zubieta was asked how many trillions of dollars the U.S. needs to invest in its ports, and which ports are the closest to being fully prepared to handle newer ships that carry twice the cargo of older vessels.

Alberto Aleman Zubieta at GWCC

Alberto Aleman Zubieta at MODEX 2012. Credit: David Pendered

“I don’t know the cost,” Zubieta responded. “What I do know is there has to be investment made in the infrastructure of the U.S.

“Some ports are going to take advantage,” he said. “Norfolk is ready…. Rail has been modernized between Norfolk and Chicago; they understand the benefit of getting cargo to its destination.

“The U.S. needs to have a comprehensive program of what ports should be the ones in which you invest the money, and then do it,” Zubieta said. “But you cannot wait 10 years because of feasibility studies. The process takes too long.”

Zubieta underscored his point by noting the entire Panama Canal was built in a decade with tools and technology available 100 years ago. He said 10 years is about how long it now takes a proposed project just to go through environmental impact studies.

Zubieta is overseeing the $5.3 billion expansion of the Panama Canal, which is to open in 2014 and provide a new trade route for ships too big to use the canal. Those vessels, carrying goods from Asia, now call at ports in Los Angeles and Long Beach, Ca. Trains carry the goods to their final destinations, and Zubieta said this method will remain the standard for high-value cargo.

Zubieta was in Georgia this week to deliver two keynote speeches – the one Tuesday at the Modex 2012 logistics conference, and Monday at the Georgia Foreign Trade Conference 2012, at the Cloister on Sea Island.

As Zubieta described his view of global shipping, he shifted the paradigm of the proposed deepening of the Savannah Harbor from its traditional form when discussed in Atlanta.

Savannah’s port is more than a staging venue for commerce with Asia that needs a deeper harbar, according to Zubieta. (Next month, Atlanta Mayor Kasim Reed will lead a trade delegation to China in hopes of establishing future trade relations for Atlanta-area companies.)

According to Zubieta, once Savannah Harbor is deepened, the bigger ships will provide access to Asia and a myriad of trans-shipment destinations. The idea could be to expand trade between Savannah and way stations in Jamaica, the Bahamas, Panama, and eventually even Cuba.

The Cuban port of Mariel – located about 25 miles west of Havana – has been targeted for a $1 billion expansion project to be completed in 2014. Brazil is putting up 70 percent of the investment, according to a report last week by the BBC. Singapore also is investing in the Mariel port, Zubieta said.

From these way stations, Georgia companies could distribute goods throughout Central and South America, Zubieta said.

The U.S. has free trade agreements with countries including Peru, Mexico and Chile, and is negotiating trade promotion agreements with Panama and Columbia, according to export.gov.

“What you need to understand is that you’re in a globalized world,” Zubieta said. “There is a market to be captured, and if you don’t capture the market, someone else is going to do it.

 

About David Pendered

David Pendered, Managing Editor, is an Atlanta journalist with nearly 30 years experience reporting on the region’s urban affairs, from Atlanta City Hall to the state Capitol. Since 2008, he has written for print and digital publications, and advised on media and governmental affairs. Previously, he spent more than 26 years with The Atlanta Journal-Constitution and won awards for his coverage of schools and urban development. David graduated from North Carolina State University and was a Western Knight Center Fellow. David was born in Pennsylvania, grew up in North Carolina and is married to a fifth-generation Atlantan.
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2 comments
writes_of_weigh
writes_of_weigh

Further on the Savannah port questions as outlined above.......and as CL's Thomas Wheatly mentions in a recent posting on CL, (the Georgia rail network routings and capacities for cargoes into and from the Savannah port are not current as of December 1, 2011 as indicated in) a Cambridge Systematics report on the issue(s) dated December 2011, reveals the looming rail traffic flood in and around metro Atlanta(and today's Caterpillar announcement for the Athens area(if brought to fruition) will only exacerbate these problems. A solution might be to encourage upgraded east-west rail routing options out of the MMPT "gulch" area..... say to Athens(i.e. the long proposed and often derided(unridable?)Brain Train via Eastlake Junction-East End Emory(siding area) via the old Georgia Road/SAL/CSX route) thence via a rebuillt Murmer trestle just beyond the Athens MMPT connecting to CSX's ex-GA road mainline and on to Augusta or Greenville/Spartanburg as the needs( High speed rail/Savannah port cargoes dictate). This might help to aleviate additional operations over the "dangerous"(NS's term) west side Corridor, which just may be how tomorrow shapes up.....er...moves(at least on that particular route). Now if G & W rail could just be convinced(along with the Americus, GA " Daughters" chapter) to allow upgrading of rail capabilities from the new inland port of Cordele westward to a rebuilt connection at Cottonton, AL to the Kershaw Railroad outside of Montgomery, AL., an extension of the "Meridian (rail)Speedway" from Meridian, MS to the port of Savannah, just might be possible. Wonder if the "sage" of Omaha has had his "railRose" look into linking west to east? Just more random ponderings?????

writes_of_weigh
writes_of_weigh

Just a few questions....Is Mr. Zubieta connected to the U.S. railroad industry, say...the Kansas City Southern? Did he happen to mention in his Atlanta speeches, 1) that once (if?) the port at Savannah is deepened, there is projected (by the U.S. DOT) to be a literal flood of rail freight traffic out of Savannah to nearby distribution "gateway" cities, like Atlanta, Memphis, Charlotte...etc., and that DOT projections for the freight volume, will require extensive rail freight infrastructure upgrades(presumably by the profiting carriers( NS, CSX, Genessee & Wyoming(Savannah State Docks RR, Georgia Central)), and 2) that the rail infrastructure in downtown Atlanta, from the proposed MMPT(passenger train station) (near CNN center) to Howell Junction(approx. 2 miles north), is currently unsafe for additional trains to transit(as one of the carriers in the corridor)(NS) termed it, when the sale of the abandoned/unused Decatur Belt line to Atlanta Beltline Inc. issue came to greater "clarity." IIRC, NS termed operation of any passenger trains in the near two mile "corridor" unsafe or dangerous. If in fact that is the instant case, how does the State/Federal DOT intend to operate "High Speed Rail" trains from the MMPT out of downtown(the "gulch" area), north to Howell Junction, and then from there northeast towards Gainsville, Toccoa, Charlotte, (a route which just landed around $5 million in HSR study grants) or west/northwest toward Chattanooga/Birmingham on Norfolk Southern trackage? Further, the conundrum of forwarding dozens of additional container trains over the "corridor" from the "gulch" area toward NS's Whitaker Intermodal facility near Austell, GA , would seem unsolvable. Perhaps, the only viable solution truly would be the installation of proposed Positive Train Control on the "corridor", at considerably greater cost than currently planned. JUST SOME RAMBLING THOUGHTS.............

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