Development of Panama as a logistics hub and the impact on Latin America

Abstract

The Panamanian government is executing an aggressive economic growth initiative to transform the country into a regional logistics hub, like Singapore or Dubai. Two elements of the initiative are expansion of the Panama Canal and development of the Panama Pacifico Project, a large logistics park. The government initiative is analyzed with respect to the logistics hubs in Singapore and Dubai by 1) identifying a structure of critical factors for developing a logistics cluster, 2) using this structure to analyze the feasibility of Panama becoming a major logistics hub, and 3) exploring the impact of a logistics_hub in Panama on the Latin American network of ports. We make recommendations so that Panama can speedily develop its logistics hub, and so that Latin American ports whose existence is threatened by this development can adapt.