Panama Forum

panamajames
Joined 2012
Posts: 5096

10 years ago

Canal expansion builders ran out of money?

10 years ago

The facts seem to bear out what was said in 2009, according to WikiLeaks, by the U.S. ambassador, who described Sacyr as "a bankrupt company sustained only by the Spanish government."
Thursday, January 9, 2014
The dialogue regarding the cost overruns in the construction of the canal expansion project between the Panama Canal Authority (ACP) and the consortium Grupo Unidos por el Canal (GUPC)-initiated by the intervention of the Spanish Minister of Development- has been interrupted, and it is not even the Spanish group Sacyr that is the spokeshead but instead it is now the other majority company in the Consortium, Italy's Impregilo, which is asking - via the media- for $1 billion from the ACP, while keeping up its threat to stop the work.

..................................................

It seems clear that the construction consortium lacks the financial resources to complete the work under the terms of the original contract, which brings to mind the criticisms of the award of the project to GUPC, who bid a much lower price than the other proponents, an amount which was said to be "not enough even to pay for the concrete."

Among the main criticism of this award, it has been noted that GUPC met the requirements of financial strength set out in the prequalification process of the tender, with a bond issue of $50 million which was backed by the agencies promoting exports from the governments of Spain, France and Italy and not by the capital market, which is always more critical in its decisions, as the company Bechtel had to do.

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Source: Maritime-executive.com

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