AGUA CLARA (Panama) • A huge Chinese container ship started making its way through the newly expanded Panama Canal yesterday in the inaugural trip through the vital waterway.
Crowds of thousands gathered alongside the canal cheered as the vessel Cosco Shipping Panama began its journey, entering from the Atlantic en route to the Pacific in a trip due to take about eight hours.
The expansion work carried out since 2007 - and delivered two years late at a cost of at least US$5.5 billion (S$7.4 billion) - allows a new generation of much larger ships, known as Neopanamax class vessels, to ply the canal.
"This is a great day, a day of national unity and a day for Panama," President Juan Carlos Varela said. "This is the route that unites the world, the Panama Canal."
The United States and China are the two most frequent canal users. Its expansion is expected to greatly benefit commercial traffic between North America and Asia.
Neopanamax freighters can carry up to three times the cargo of older and smaller Panamax ships.
Cruise ships built to the same dimensions typically double the number of passengers of the previous iteration.
The expansion will also allow Panama to lure massive liquefied natural gas (LNG) tankers for the first time.
They represent a lucrative segment of the shipping market whose importance has grown with the development of US exports of natural gas from shale, most of which head to Japan and South Korea.
Panama's plan behind the expansion is to treble the US$1 billion in revenues it now gets from canal shipping fees. That goal might still be a decade or more away, however, according to officials from the Panama Canal Authority, the autonomous government agency that runs the waterway.
The government hopes the glitz and historical nature of the broadened canal will help overshadow the severe blow the country took to its reputation this year with the "Panama Papers" scandal.