Impact of Drought - Panama Canal Toll Revenue Faces Decline

A ship transiting the Panama Canal
Updated Published

On Wednesday, the administrator of the Panama Canal disclosed a monthly decline of roughly $100 million in toll revenues since October. Expressing concern, the administrator warned that if this trajectory persists, the reduced income from tolls could accumulate to around $700 million by April.

The decrease in revenue is attributed to the persistent drought conditions, compelling the canal administrators to enforce shipping restrictions along the ancient watercourse. This canal holds significant importance as a pivotal global trade route, connecting the Pacific and Atlantic Oceans.

The financial year for the canal commences in October and extends until September.

During a press conference, Ricaurte Vasquez, the Canal Administrator, characterized the ongoing decline in toll revenue over the upcoming months as a "potential" occurrence in remarks made to journalists.

He further mentioned that the canal anticipates achieving the financial goals outlined in its budget for the fiscal year, partly attributable to a recent implementation of elevated tolls.