The $1.6 billion plan to fix the Panama Canal's drought problem

Panama Canal Operations and Challenges - The Panama Canal is a critical shipping route, handling approximately 14,000 vessel transits annually, including about 40% of all US container traffic [1] - Recent droughts have forced the Panama Canal Authority to implement weight restrictions and limit vessel transits to 18 ships per day, while the normal transit volume is about 36 ships daily [1] - The 2023-2024 drought was the worst Panama has experienced in over 70 years [1] - Low water levels in Gatun Lake, which fell 8 feet below average, restrict the amount of cargo ships can carry [3] - Companies like Maersk have resorted to using landbridges to circumvent the canal's restrictions [4] Infrastructure and Investment - The Panama Canal Authority plans to invest $1.6 billion to construct a new reservoir with a capacity of 1.2 billion cubic meters of water to mitigate future droughts [4] Social and Environmental Impact - The proposed Rio Indo project, involving flooding 17 square miles of land, faces resistance due to its potential impact on approximately 2,500 people [5] - The reservoir construction could submerge villages, displacing residents and affecting their livelihoods [5]