Panama Freight Transport Report Q3 2012
- ID: 2200939
- June 2012
- Region: Panama
- 49 pages
- Business Monitor International
The Panama Freight Transport Report provides industry professionals and strategists, corporate analysts, freight transportation associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Panama's freight transportation industry.
BMI maintains its positive outlook toward Panama's growth outlook, forecasting real GDP growth of 8.1% in 2012 and 7.3% in 2013, as a result of continued robust private consumption. That said, we caution that with the completion of the Panama Canal nearing, the previous steady stream of investment may become somewhat less stable until the country is able to ensure more diversified investment opportunities.
Despite rising global headwinds in Q311, Panama's real GDP growth surprised to the upside at 10.4%, bolstered by strong commercial and construction sector activity. Panama remains a regional growth outperformer and we expect this trend to continue in coming years.
The Panama Canal remains a guaranteed source of income and freight volumes for the country and it will provide a further boost to trade and earnings in late 2014, when the ongoing US$5bn expansion project is completed. The ratification by the US congress of the Panama Free Trade Agreement (FTA) is also excellent news for freight transport volumes, as it will certainly boost trade between the two countries.
Key Industry Data
- Air freight tonnes are set to grow by 5.3% in 2012, to 131,100 tonnes. BMI forecasts average annual growth of 4.6% over the medium term.
- Total tonnage throughput at Balboa is expected to grow by 5.8% in 2012. We forecast average annual growth of 6.9% over the medium term.
- Total tonnage throughput at Manzanillo is forecast to grow by 2.9% in 2012. We forecast average annual growth of 3.6% over the medium term.
Key Trends Panama Canal Users Should Expect Rising Costs As 2014 Approaches BMI believes that shippers using the Panama Canal will face rising costs in the approach to 2014, the completion date for its expansion. BMI believes that with shipping rates remaining depressed, shipping lines will try to pass on the increasing cost of transiting the canal to their customers.
Panama Canal Expansion To Be Delayed Further, United Group Risks US$54mn Fine BMI believes it is becoming increasingly unlikely that the Panama Canal expansion will be finished by the end of 2014, as the project, currently six months behind schedule, continues to struggle with delays.
Risks To Outlook The main risk to our outlook is on the upside. BMI believes that when the Panama Canal expansion project is completed in 2014, it will see increased throughput from larger container vessels. This will raise throughput at the country's ports and possibly have a positive effect on road and rail freight.
Further upside risk comes from the ratification of Panama's long-awaited FTA with the US. This will eliminate exports duties on many goods which are transported between the countries, potentially providing a valuable boost to port throughput volumes. In the short term, a downside risk presents itself in the form of increasing canal tolls, which are being used to fund the expansion. Several lines have already introduced surcharges passing this extra cost on to customers, but if rates continue to go up, lines could avoid the canal in an effort to cut costs. We believe that rates will level off when the expansion is completed, so this should not have a long-term effect on traffic.
A further downside risk comes from a possibility of a slowdown in the US' economic recovery. Sluggish consumer demand could result in a drop in demand for imported goods from China, which would have a negative knock-on effect on the Panama Canal's throughput volumes. SHOW LESS READ MORE >
Executive Summary 5
SWOT Analysis 7
Panama Freight Transport Industry SWOT 7
Panama Political SWOT 7
Panama Economic SWOT 8
Industry Trends And Developments 9
Market Overview 11
Table: Plenty Of Projects In The Pipeline 13
Industry Forecast 14
Air Freight 14
Table: Air Freight, 2008-2016 14
Table: Maritime Freight - Throughput, 2008-2016 ('000 tonnes) 14
Table: Trade Overview, 2008-2016 15
Table: Key Trade Indicators, 2008-2016 (US$mn) 16
Table: Panama's Main Import Partners, 2002-2009 (US$mn) 17
Table: Panama's Main Export Partners, 2002-2009 (US$mn) 17
Global Oil Products Price Outlook 18
Table: BMI's Refined Products Forecasts, 2010-2016 18
Political Outlook 26
Long-Term Political Outlook 26
Macroeconomic Outlook 31
Company Profiles 34
Panama Canal Authority 34
Copa Holdings 38
Country Snapshot: Panama Demographic Data 43
Table: Panama's Population By Age Group, 1990-2020 ('000) 44
Table: Panama's Population By Age Group, 1990-2020 (% of total) 45
Table: Panama's Key Population Ratios, 1990-2020 46
Table: Panama's Rural And Urban Population, 1990-2020 46
BMI Methodology 47
How We Generate Our Industry Forecasts 47
Transport Industry 47