Panama Canal secures expansion financing
The Panama Canal Authority said Tuesday it has signed $2.3 billion in financing from five international banks and lending agencies to fund its massive canal expansion project.
The banks and canal officials held a signing ceremony Tuesday, making official loan agreements announced in recent months.
The lenders are:
' Japan Bank for International Cooperation ($800 million).
' European Investment Bank ($500 million).
' Inter-American Development Bank ($400 million).
' Corporaci'n Andina de Fomento ($300 million).
' International Finance Corp. ($300 million).
The financing will cover 43 percent of the total cost of the $5.25 billion project, with 'canal-generated cash flow' making up the rest, most likely in the form of user fees.
The canal authority has been scouting for financing options since July 2007, and its endeavor was aided by a favorable credit rating from rating agency Moody's. The expansion project will see a new lane of traffic along the Panama Canal built through the construction of a new set of locks, which will double capacity and allow more traffic and longer, wider ships.
'The geographic diversity of the offers and the high profiles of the institutions, demonstrate the international market's trust and confidence in the high-growth performance of the Panamanian economy and the successful management of the Panama Canal,' said Alberto Alem'n Zubieta, canal authority administrator and chief executive officer, in a statement.