Trillions of dollars in goods from around the world have crossed through the Panama Canal. With ongoing reliability issues at the Panama Canal, Mexico has decided to build an Interoceanic Railway to ease global shipping at the Panama Canal. The railway will cross through Veracruz and Oaxaca, a 188-mile route, across the Isthmus of Tehuantepec to connect the Pacific and Atlantic Oceans.
Despite widening the Panama Canal locks by 70 feet, many ships cannot pass through efficiently. With a historic drought in Panama, water levels at Lake Gatun are at record lows. Since the Panama Canal relies on the water from Lake Gatun to operate the lock system that moves ships through the canal, shipping companies are losing time and money. Some vessels wait for weeks or pay millions of dollars to jump ahead of the line.
In this video, the Wall Street Journal discusses Mexico’s plan, the strategic location, and the impact that the Interoceanic Railway has on trade relations and residents.
