Could The Panama Canal Run Dry?
It took from 1904 to 1914 to build the Panama Canal. It was an engineering marvel and changed sea travel between the Atlantic and Pacific Oceans. It could not have occurred to anyone then that climate change could possibly cause the canal to run dry 110 years later. However, it may come to that.
The notion that the canal might not operate because water levels are too low was inconceivable then. Similarly, who would have believed a few years ago that The Great Salt Lake could be gone before the end of this decade? Similarly, how could anyone have imagined that the Hoover Dam would be unable to provide electricity for over one million people in Arizona, Nevada, and California because of the drought that has affected Lake Mead, which delivers the water for the dam’s turbines?
The number of ships that can use the Panama Canal has dropped alarmingly. The reason is drought. According to The New York Times:
Before the water problems, as many as 38 ships a day moved through the canal, which was built by the United States and remained under its control until 2000. The canal authority in July cut the average to 32 vessels, and later announced that the number would drop to 31 on Nov. 1.
A reservoir could be built near the Canal to help the problem, but to do this will be complicated, expensive, and might not work. Additionally, it would take years, which is too much time to solve this already critical problem.
According to Bloomberg, the Panama Canal economic issue spreads well beyond the shipping industry. In a story titled “The Fed’s Inflation Fight Faces a New Challenge: A Dry Panama Canal,” the writer details the Canal jam as a classic global supply chain shortage. Shipping costs are often a leading indicator of future inflation.
It will be up to the rain gods whether the Panama Canal will be depleted of water. Nevertheless, the Canal’s current state is severe enough that the Canal’s value as a means of transit has begun to collapse.
