Fears Come True

More than four years ago, when Panama awarded the lucrative contract to expand its inter-oceanic canal to a mostly European consortium, the United States was not pleased.

An American company whose bid was unsuccessful, Bechtel, thought the winning tender would barely pay for pouring the concrete and that the consortium would probably try to renegotiate the price at some stage during the construction process.

The spat has threatened to bring work to a grinding halt, unless the two parties manage to resolve a $1.6bn (£1bn) dispute over cost overruns.

A series of WikiLeaks cables from the US embassy in Panama that were revealed by the Spanish daily newspaper El Pais in 2010 provided an inside view of the frustration that was felt in the US at not having been able to get that contract.

Instead, the contract was secured by the GUPC consortium (co-led by Spanish company Sacyr and Italian Impregilo), which had offered considerably less money than other bidders but whose proposal, in the opinion of the canal authority, had the best value.

The cables also revealed that the US has retained a "fundamental interest" in the expansion project. This is hardly surprising, since the government has calculated that two-thirds of everything that passes through the canal is either coming from or going to the US.

 Last November, for instance, Vice-President Joe Biden traveled to Panama with a handful of local and national politicians in order to stress the "profound effect" the new waterway will have on the US economy.

That effect can be mostly seen across US ports, and especially in cities like Miami, Baltimore and Norfolk, which have been investing heavily in order to ensure that they will be able to take the supersize container ships that will travel through the canal.

But there is much more to understanding US interests in the isthmus than just economics. The Panama Canal, after all, was not only built by the Americans in the early years of the 20th century, they also controlled its operations until 1999.

Throughout its history, the canal has embodied a long-term historical goal of the US, namely to have a waterway that will facilitate international maritime trade, and it has been seen as a strong reminder of US technological and economic prowess.

Although the works are already behind the original schedule, the expansion project as a whole is 72% finished, and the new locks are two-thirds complete. Some people believe that the new canal is, in fact, too far advanced to be in real danger, and others argue that these types of delays are normal for such an enterprise.