Central America: Panama rejects EU offer to mediate canal dispute

Panama Canal

The Panama Canal Authority continued informal talks with a Spanish-led consortium on Monday, seeking to resolve a US$1.6-billion cost-overrun dispute that has threatened to halt the biggest part of the project to expand the canal.

The consortium, led by Spain's Sacyr Vallehermoso, had given a Sunday deadline for the authority to come up with funds or face a work stoppage. But the project continued at the same 25 to 30 per cent activity level it has seen since the conflict arose in November, said canal Administrator Jorge Quijano.

The canal authority rejected an offer by the European Union to mediate its dispute with the mostly European construction consortium, United for the Canal.

The contract for completing the third set of locks already includes mechanisms to resolve disputes, and none involve third parties, the authority wrote in an email responding to questions from The Associated Press.

The canal-building group said in a brief statement Sunday that a stoppage "is not a scenario being considered at this moment".

Read more: Panama rejects EU offer to mediate canal dispute - Business - Jamaica Gleaner - Tuesday | January 21, 2014