China in Panama: high-speed rail, mega infrastructure news + more

The feasibility study for the US$5.5 billion high-speed rail megaproject linking Panama City to Chiriqui province is now in its final stretch. The field data’s in and the report is scheduled to be delivered by China Railways Corporation’s (CRC) to Panama by November.

It’s one of the most prominent Chinese infrastructure projects to watch and it was the first project Panama signed with China before the Belt and Road Initiative was even on the table. The project came out of an MOU signed in November 2017 during President Varela’s first state visit to Beijing since diplomatic relations were established.  

CRC’s plans are to build a 450km railway line from Panama City to David, right on the Costa Rican border. The lines will carry high-speed passenger and cargo trains at 160km/hour (maximum speed), meaning it’ll cut down journey times that today take 6-8 hours by car or bus to just 2.5 hours by train. For now, the plans are for 16 stops (stations) en route: Arraiján, La Chorrera, San Carlos, Chame, Río Hato, Penonomé, Aguadulce, Santiago, Soná, Tolé y David. Do any ring a bell? You read it right, some are Panama’s most popular beach destinations.

Photo by: La Prensa Panama

So, not only will the line be a first for Panama’s infrastructure mix, it’ll be a boon for tourism and commerce, and, crucially, it’ll bring together two key ports to strengthen the logistics sector.   

Construction won’t be an easy feat — seismic concerns might very well surface around Tolé in Chiriquí, the tunnels and bridges around Veraguas look dicey, and don’t forget environmental commitments, like the need to protect mangroves. For now, there are still several alternatives on the table about how to link the train up to the Metro system in Panama City, too. We’re looking forward to the final report out early next year, which will also be vetted by Panama by that point.

There are some other major projects garnering attention these days in Colón province. Shanghai Gorgeous, a private Chinese group, is investing US$1.8 billion to develop a container port and a power plant. The Colón Container Port project on Margarita island will add 12 cranes and capacity to handle 20-foot containers, while the Martano power plant will supply a terminal with natural gas from a floating tank by 2020. Both projects are valued at US$900 million.

And lastly, a bit of non-news: plans to build the Chinese Embassy in Amador are off the table; Albrook and Clayton are still being considered. So if you’re on the lookout for top notch real estate in Panama City, who knows, the Chinese embassy might just be your new neighbor next year. Should you worry that they’ll drive prices up? But I digress.