PANAMA CITY – The Panama Canal aims to remain competitive but will not raise tolls or engage in the “price war” that Egypt’s Suez Canal has apparently launched by offering discounts of up to 65 percent, the administrator of the Central American waterway said on Thursday.
“When we were about to launch our expansion (on June 26), Suez began with a 35 percent discount. Later, they raised the discount to 50 percent and the latest is they’ve lowered prices by as much as 65 percent. We’re not going to enter a price war,” Jorge Luis Quijano said.
Those discounts are causing many of the ships traveling to and from the U.S. East Coast to return to Asia via the Egyptian waterway instead of through the Panama Canal, Quijano said.
“We’re losing an estimated $600,000 for every ship Suez takes,” the administrator said.
The Panama Canal established new tolls in April and has ruled out raising them for the time being, Quijano told reporters at the Cocoli locks on the waterway’s Pacific side.
Since the expanded Panama Canal was inaugurated on June 26, 165 ships have traveled through the new third set of locks, most of them container vessels that have paid a total of “nearly $80 million in tolls,” Quijano said.
The new locks allow the canal to accommodate modern New Panamax ships, which can hold up to 13,000 20-foot-long containers and are three times bigger than what the waterway could previously handle.
The Suez Canal, however, can accommodate even larger vessels.