The Panama Canal Expansion Program - Why?

The locks are the narrowest points of the Panama Canal and form, both in the flow of the amount of vessels per hour as in the size of the vessels, the bottleneck for its capacity. In 2006, the Panama Canal Authority (Autoridad del canal de Panamá, further abbreviated as ACP) therefore published the Proposal for Expansion of the Panama Canal: Third Set of Locks Project. This document neatly describes the background of the Expansion Program.

It elaborates on the history of the plan to further develop the Panama Canal, and states that since the 1930’s, all studies about the widening of the canal agreed that the most effective and efficient alternative to enhance Canal capacity would be the construction of a third set of locks. Lock chambers with bigger dimensions than those of the locks built in 1914 were perceived as the most valuable point for development. In 1939, the United States started the construction of a new set of locks that would allow the transit of larger vessels and warships.

Due to the outbreak of World War II they had to cease the construction works. Personnel of the United States in Panama had to join the army and most construction equipment was assigned to military tasks [1]. By the end of the war, the United States had lost its interest in expanding the waterway. Its fleet was now so vast that the canal’s original purpose -avoiding the support of a two-ocean navy- had been outgrown [2]. Although much use was made for ferrying men and materials for the Korean and Vietnam wars, the Panama Canal had no major upgrades. In the 1980s, according to the proposal document, Panama, Japan and the United States formed a commission that again studied possibilities to further develop the Panama Canal, and again decided that an extra set of locks would be the most appropriate alternative for increasing the Canal’s capacity.

The expansion of the waterway is estimated at a cost of US$ 5.2 billion and expects to generate approximately 40.000 new jobs during the construction of the third set of locks [1]. The proposal for the Expansion of the Panama Canal (2006) portrays four objectives for expanding the Canal’s capacity:

  1. Achieve long-term sustainability and growth for the Canal’s contributions to the society of Panama through payments to the National Treasury;
  2. Maintain the Canal’s competitiveness and its added value as a maritime route;
  3. Increase the Canal’s capacity to capture the growing tonnage demand with the appropriate service level; and,
  4. Make the Canal a more productive, safe and efficient work environment.

This document formed the foundation for a national referendum and marked the start of ACP’s campaign to vote for the expansion of the Panama Canal. Opposition to the project mostly voiced its opinion through various radio programs, videos, and websites. The website El Centro Informativo Panamá 3000 (The Information Center Panama 3000) led by Roberto Méndez, a Professor of Economics at the University of Panama, published four reasons to reject the proposal:

  1. Negative outcomes for the economy
  2. Lack of confidence in the government and the ACP
  3. Health and education should be national priorities,
  4. Destruction of the environmental and social security

In an interview Professor Mendez concluded that, based on his economic and financial analysis, the Expansion Program makes no sense, and might even be a bad development for the country [4]. Martin Rosales, who studied the conflicts between the Panama Canal Expansion Program and the local communities for his Ph.D. thesis, agreed with this counter argument. He concluded that the ACP denied the complexity and contradictions of the expansion project and underscored that a monopolized decision-making process limited the space for counter rationalities [5]. Despite strong objections from various parties, the intense governmental campaign in favor of canal expansion could not be overruled.

On October 22, 2006, the majority of the voters, 76.8%, voted in favor of the Panama Canal Expansion Program [6, 7]. Although more than sixty percent of the total voters did not participate in the national referendum [5], this outcome gave the ACP a green light for the Expansion Program.

Why did I choose the Panama Canal Expansion Program as a case study?

In search for a case that would allow me to study the practices of collaboration in an infrastructural project organization, I started with an online search. Since I had adopted an interpretive approach and the ethnographic research methodology in particular, only a small number of cases could be studied. One mega project would be sufficient, as it consists of various separate research cases and can deliver an overwhelming set of data. However, the mega project should be under construction during the fieldwork period, between July 2009 and July 2010.

I did not aim to study practices of collaboration in retrospect nor was it my intention to study a project that had not passed its kick-off date yet. Furthermore, I searched for projects that a) contained international partners, b) I could obtain access to and c) allowed a longitudinal study suitable for the research budget. Ten mega projects ended on a short list (see Table 1).



Project Description




Development of an European navigation satellite

Noordwijk, Netherlands


North/South Line

Construction a new metro line in Amsterdam.

Amsterdam, Netherlands


Maasvlakte 2

A land reclamation project to construct a new port adjoining the

Rotterdam, Netherlands


NUON Energy Station

Construction of a new energy station.



Caofeidian New Coastal City

Development of an ecological coastal city in Northern China

Caofeidian, China


Panama Canal Expansion Program

Expansion of the current Panama Canal with the building of a new set of

Panama City, Panama


Fehmarn Bridge

Construction of a bridge over the Fehmarn Belt to connect Germany and

Germany - Denmark


Palm Islands

Construction of the three largest artificial islands in the world.

Dubai, United Arab Emirates


Sheringham Shoal

Construction of the UK’s fourth largest off shore wind farm.

United Kingdom


Export Gateway

Deepening the navigation channel to the Port of Melbourne

Melbourne, Australia

Table 3.1: Short-list of mega projects


To further the selection of the research case, three principles were taken into account. The first principle was the location of the mega project. My supervisors and I had discussed the possibilities to study a project outside of the Netherlands and I was open to that opportunity. Following Hodgon & Muzio [10], we preferred projects outside of Anglo-Saxon economies, and in a region where mega projects had been insufficiently explored in the literature. Due to this principle, the projects in the Netherlands as well as those executed and studied in the UK, Scandinavia and Australia were erased from the short list.

The second principle in the selection process was of a more practical concern; the spoken language in the mega project should be one that I master or could quickly acquire. Conducting an ethnographic study in an environment where one does not understand the local language well enough to capture verbal communication, such as informal conversations, makes the process of gathering data extremely complicated. As a result, the mega project in China was deleted from the short list.

The third principle involved accessibility and acceptability. Ethnographic studies require that, at least in principle, the researcher is granted access to all actors, meetings and documents. Furthermore, it is important that the researcher can be accepted in the society under study and is allowed to move around freely in the daily project environment. As we could not guarantee this would be the case in Dubai, mainly because we had no contacts there, that project was also erased from the short list.

One of my academic supervisors did have strong connections contact with the Dutch Ministry of Public Works and Water Management (Rijkwaterstaat, further abbreviated as RWS), a company that has a knowledge-sharing relationship with the Autoridád del Canal de Panamá (Panama Canal Authority, further abbreviated as ACP). I visited my supervisor’s contact at RWS and received contact details from his connections working in the Panama Canal Expansion Program. An extensive email exchange on the research topic and the practicalities around this study finally resulted in green light to conduct my research at the Panama Canal Expansion Program. Also, I remained in contact with RWS as they included me in their knowledge-exchange program with the ACP[1].

The Panama Canal Expansion Program met all three principles for the selection of the research case: the project is located outside of the Netherlands and based in an area (Central America) where only few mega projects have been conducted or studied before. The project language is English and my, at the start of the fieldwork, intermediate level of Spanish would be convenient in the Spanish speaking Panamanian society. The ACP had granted access to its actors and documents, and agreed to provide me with a workstation and other facilities needed.


1.         ACP. Proposal for the Expansion of the Panama Canal: Third Set of Locks Project. 2006March 2009]; Available from:

2.         Parker, M., Panama Fever: The epic story of the building of the Panama Canal. 2009, New York: Anchor Books.

3.         Méndez, R.N. Cuatro razones para decir "no" a la ampliación. 2006November, 2011]; Available from:

4.         Noriegaville, Panama Canal Expansion: A senseless project, in Available at ACP Library. 2006: ACP Library.

5.         Rosales, M.R., The Panama Canal Expansion Project: Transit Maritime Mega Project Development, Reactions, and Alternatives from Affected People. 2007, University of Florida.

6.         ACP. Autoridad del Canal de Panamá. 2009March 2009]; Available from:

7.         Jaén Suárez, O., Diez años de administración panameña del Canal. 2011, Panamá: Autoridad de Canal de Panamá.

8.         Alverca, J. Panama Canal Expansion Program: Overview. 2012.

9.         ACP, Panama Canal Expansion Program Brochure. 2010, Autoridad del Canal de Panamá: Panamá.

10.       Hodgson, D. and D. Muzio, Prospects for professionalism in project management, in The Oxford Handbook of Project Management, P.W.G. Morris, J.K. Pinto, and J. Söderlund, Editors. 2011, Oxford University Press: Oxford. p. 105-130.


[1] Besides their support for obtaining access in project organization, RWS was not involved in the research nor did RWS play a financial role in this study.

Author: Karen Smits / Publisher: SCMO

Nicolas de Loisy

Advisory specialized in logistics, transportation, and supply chain management.