Although redevelopment work on the Panama Canal continued on Monday, experts put at pace of construction at below 30 percent capacity. Monday marked the date of an ultimatum, issued by a consortium of European contractors on December 30th to suspend work if the Panama Canal Authority (ACP) would not recognize a cost overrun of $ 1.6 billion in the $3.2 billion budget for the construction of the third set of locks.
Union leaders have complained of uncertainty among workers because the company has not informed them if they will not stop or work.
The expansion project began in 2009 and was due to end by 2014, and in time for the 100 year anniversary of the original Panama Canal construction on August 15, 1914. Experts say that the earliest date to finish the project would now be in June 2015.
Delays also affect income projections tied to higher expected capacity, when ships of up to 16,000 container capacity will be able to transit the canal. The ACP brings collects about $960 million annually in fees, which represents 10 percent of the total annual tax revenue for Panama.
According to a economist Francisco Bustamante, formerly of the the Inter-American Development Bank (IDB) the total cost overrun for the project may be $2 billion and the delay will affect customers in the United States and China.