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Pact reached for further talks on Panama Canal

Expansion stopped in dispute over $1.6 billion in cost overruns

23 January, 15:23
Pact reached for further talks on Panama Canal (ANSA) - Milan, January 23 - An agreement was reached Thursday between a consortium of companies, including an Italian firm, and the Panama Canal Authority to continue negotiations on a major expansion of the canal.

A protocol on negotiations between the mostly European consortium, including an Italian company Salini Impregiol, and the canal authority was seen as "the first step towards a global agreement for the completion of the project".

The European consortium, with a contract worth $5.25 billion, and the authority have been locked in a dispute for weeks over $1.6 billion in cost overruns.

The consortium, known as the as Grupo Unidos Por el Canal (GUPC), said last week that it would stop work if the authority failed to cover the $1.6 billion.

An Italian government statement at that time said that the administration had "activated contacts with the governments of the countries interested and the European and international financial institutions that are financing the project".

European Industry Commissioner Antonio Tajani told ANSA last week that the EU was "ready to intervene" if "all the European firms involved request this".

On Thursday in Brussels, Tajani repeated that message, adding that "Europe speaks with one voice" on the canal project and a desire to see fruitful negotiations leading towards completing the expansion project.