The governments of Colombia and China are in talks to construct a "dry canal" alternative to the 97-year-old Panama Canal. China would fund the project, which would link Colombia's Atlantic and Pacific coasts together by rail in an attempt to facilitate increased trade between the two countries. You'll be forgiven if news of the potential partnership prompts certain questions to pop in your mind. Here are answers to four of the most pressing:
A "dry canal"...is that really just a railroad?
Yes. Yes it is. Specifically, a 136 mile railroad that would link the Atlantic coast city of Cartagena with the Pacific port of Buenaventura. In addition to the waterway through Panama, the project would also compete with the Panama Canal Railway. The Guardian's Tania Branigan notes that the Panama "rail route, built almost 60 years before the canal...is more expensive than the waterway for shippers but faster." Still unresolved, writes the Financial Times' Robert Wright, are "questions about the demand for a second inter-oceanic rail line within this relatively small area of central America."
Why hasn't anyone else thought of this idea?
They have. "Plans for an alternative to the Panama Canal are older than the Panama Canal itself," notes Jonathan Wheatley of the Financial Times. "One route would cross Nicaragua; another, southern Mexico." These plans were ultimately "ruled out by the massive engineering costs and by the environmental hazards of, for example, mixing sea water with fresh water in rivers and lakes along the way."
How do the Chinese benefit?
China's interests, writes Wheatley, are relatively simple. It wants coal [and] Colombia is the world’s fifth biggest producer." More specifically, it has "high quality coal in easily-worked surface mines close to the Caribbean end of the proposed route." By increasing efficiency of trade with Colombia, Wheatley believes China will be able tap "vast quantities of thermal coal for power stations [and] coking coal for their steel industries.Colombia has both--and would offer a chance to reduce dependence on traditional suppliers such as Mozambique."
Then there's the question of pride, explain The Guardian's Rory Carroll and Tania Branigan. While "the railway would hardly have the same impact of the canal a century ago" it would stand as "a symbol of China's economic incursions into what the US once considered its backyard... China is Colombia's second largest trade partner after the US, with bilateral trade rising from $10m in 1980 to more than $5bn in 2010."
How does Colombia benefit?
Right now, Wright notes, "ships transiting the canal can make only one stop to drop off containers destined both for Pacific ports in Latin America and those in the Caribbean." More than establishing both ends of the country as vibrant port areas, Wheatley believes the Chinese investment would help Colombia's domestic development. The Caribbean region where the coal is located is poor and marginal and long troubled by guerilla and drug-related violence," writes Wheatley. "Investment would promote security. It is also heavily dependent on the US market for its manufactured goods and agricultural exports such as flowers. Colombia, too, could benefit from diversification." On the international stage, Wheatley says that "getting close to China would help neutralise the destabilising influence of Hugo Chávez’s Venezuela" as well as nudge the US Congress towards approving a US-Colombia free trade deal.