Mexico Dreams of a Way to Rival Canal


Gilberto Chontal, a 37-year railroad veteran, squints through the grimy window of a train huffing through Mexico’s southern jungle. His eyes flicker over turn-of-the-century train stations, thatched-roof huts, peasants dozing in hammocks.

But what he sees is something else.

“Progress,” murmurs the stocky ticket collector, envisioning the super-train that may be installed here, under a government plan to link Mexico’s coasts in a corridor as efficient as the Panama Canal.

“We would have modern technology,” Chontal says dreamily.


“Here, there’s no industry. . . . There’s nothing but death.”

Since Spanish colonial days, Mexicans have dreamed of having a world-class passage between the oceans. Again and again, the dream has been thwarted--by wars, a lack of money and the success of the Panama Canal.

But now, the vision is coming back to life.

And Mexicans aren’t the only ones dreaming. As world trade grows and the U.S. prepares to relinquish the Panama Canal--prompting worries about the waterway’s future--countries throughout the region are reexamining their old dreams of creating interoceanic passages.


Some skeptics caution that the projects are about as realistic as the magical Gabriel Garcia Marquez novels beloved by Latin Americans. But freight carriers are keenly interested. And from Managua to Mexico, officials are busily planning for the day when their backwaters turn into trading centers.

“The idea that somehow you could wake up tomorrow and discover you’re on the crossroads of the world, a new superhighway, is a wonderful dream,” said John Ricklefs, a transportation consultant with the Frederick R. Harris firm in New York.

But unless the economics can be worked out, he warned, the projects could remain fixtures on a Latin American wish list, joining such long-held but elusive ambitions as a Central American Federation or a modern road through the Amazon.

Mexico has periodically considered a passage across its narrow isthmus of Tehuantepec since conquistador Hernan Cortes suggested one in 1525. But the latest proposal is as modern as a Mexico City traffic jam. The government of President Ernesto Zedillo has revived the idea as part of its program of privatizing railroads, ports and airports.

While the details are still hazy, the plan calls for a “land bridge"--an upgraded rail link between the ports of Salina Cruz, on the Pacific, and Coatzacoalcos, on the Gulf of Mexico. Ships could transfer their containers onto trains that would whisk them 180 miles to vessels on the opposite coast. The trip would be far quicker than the eight- to 10-hour passage through the Panama Canal. And some ships could further save time by not having to sail to the eastern end of Central America.

Lured by the interoceanic passage, officials say, companies would turn the poor isthmus into a hub for international manufacturing and commerce--sort of a cross between Tijuana and the Panama Canal.

“I call this the Mexico of the 21st century,” declared Mauricio Valdes, head of the Mexican Senate’s transportation commission. “The potential for development of the isthmus is enormous.”

But Mexico isn’t the only country to see such potential. Nearly a century after it lost out to Panama on hosting a giant regional waterway, Nicaragua is studying a $1.5-billion “dry canal” similar to Mexico’s scheme, to be completely financed by foreign investors. The plan features a coast-to-coast train system linking two new ports.


“Many other countries in the region are talking about mimicking our idea,” said Don Bosco, a New York lawyer who is spearheading the Nicaraguan project.

“We’re doing it. That’s the difference.”

His consortium has signed up Parsons Brinckerhoff International, a New York-based engineering firm, to do feasibility studies. When the studies are finished, Bosco’s firm will seek loans or international equity partners. Design and construction could begin in about a year, he said.

Rafael Urbina, a senior Nicaraguan transportation official, said the canal is a distinct possibility--as long as investors could be found.

“The country is really hopeful,” he said. “Since there are no jobs, the public is supporting us in trying to start this project.”

Meanwhile, Colombia also is studying a channel between the oceans, probably linking together rivers in its northwest.

President Ernesto Samper vowed a year ago to move ahead with the idea. However, asked recently when construction might begin, a government official squirmed.

“We’ve been talking about it for nearly 30 years,” he admitted. “The engineering would be very complicated.”


Even the most ardent supporters of the projects admit that none would supplant the Panama Canal. With 198 million metric tons of cargo moving through that waterway last year--providing $486 million in tolls--the canal dwarfs the other proposed corridors.

But, supporters argue, another passage is needed. Containerized shipping has boomed in recent years, especially between Asia and the United States and between the United States and Latin America. Cargo ships have become so large that some can’t fit the Panama Canal.

In addition, there is concern about upkeep of the canal after it passes to local control on Dec. 31, 1999, under the terms of the Panama Canal treaties signed two decades ago. Even now, maintenance work sometimes can force ships to languish at the canal for hours or days.

Another canal “would bring more efficiency or an alternative in case the Panama Canal became a less-than-viable option,” said John Urban, a vice president at American Pacific Lines Ltd., a shipping firm in Oakland.

But he quickly added that the current proposals need more work. A speedy rail line or two may not be sufficient to carry the kind of loads borne by modern ships, he said.

“The graphic in my mind that pops up is a fire hose on one side and a fire hose on the other side, and a garden hose connecting them,” he said.

J.T. Keegan, a senior vice president at Sea-Land Service Inc., the biggest shipping firm in the U.S., said: “It would be a great alternative to the congestion we have in the canal. But to be frank, the upfront capital costs are so significant.”

Bankrolling the construction is only part of the problem. The new dry canals have to coordinate cargo moving from a ship to a train to another ship--and do so economically.

Such challenges already have led some countries to scale back their plans. Politicians in Costa Rica, for example, had vigorously debated a train-and-port channel. But the idea appears to have stalled.

Another version of a dry canal--this one, a freeway that would connect ports in Honduras, El Salvador and Nicaragua--is being pitched as a regional transportation link instead. Roger Marin, a Honduran businessman who is heading the project, which would be funded by local and foreign investors, said it wasn’t practical to go head to head with Panama, especially since that country’s train service is being upgraded.

“Why would you want to compete with a canal that is working efficiently, now that it will have traffic on a railway too?” he asked.

Mexican authorities face even stickier concerns. Fears of Yanqui domination--an issue since the days of the steam railroad--have prompted protests by left-wing and Indian groups.

Their suspicions increased after a government-commissioned study was leaked to the media last year, describing a key role for foreign investors in the isthmus “mega-project.” The study suggested luring big international companies--like Wisconsin Central Railroad and Norfolk Southern--and investing more than $400 million on the project.

“We don’t want to live like Panamanians,” declared Roberto Lopez Rosado, the leftist mayor of Juchitan, a town near the rail line. “They don’t have total freedom or sovereignty on their own territory.”

If the government goes ahead with the project without heeding locals, he announced darkly, “there would be an uprising of the Indians of the isthmus.”

The Mexican government has tiptoed around the issue so far. Aaron Dychter, the assistant transportation minister, acknowledged in an interview that the government was basing its plans on the 1996 study. That envisions building a “complementary alternative” to the Panama Canal.

But Dychter played down any challenge to the canal, emphasizing, “We want to promote the [isthmus] region.” While Mexico wants to lure international shipping traffic, it’s not clear how ambitious its project will be.

The government is already moving to dampen concerns about Mexico’s sovereignty. Officials now say the government will retain some control of the railroad. Foreigners will not be allowed a majority stake.

Authorities will probably decide by the end of the year exactly how they will proceed, Dychter said.

“We already have a train functioning there,” he added, indicating that improvements would not be that difficult.

But a visit to the 90-year-old Tehuantepec Railroad suggests otherwise. These days, two daily cargo-and-passenger trains wheeze along the palm-fringed line where the shiny dream trains may one day speed by. Average speed for the trip: 20 miles an hour.

Charging $4.50 for the daylong journey, the train attracts the region’s most humble travelers. On a recent afternoon, passengers carried on board metal washtubs, bundles of sugar cane and even a green parrot.

Perched on ripped, stained baby-blue vinyl seats, they stared at the passing poverty through filthy windows.

“The trip takes forever because the route is so bad,” complained Margarita Lopez, 71, an Indian passenger in a long skirt and beribboned gray braids.

Chontal, the ticket taker, noted that the train is forced to slow to a crawl when it rains, because the earth shifts under the tracks. Landslides and rotted wooden rail beams also sometimes slow the trip.

The passengers were so disgusted with the railroad that they even vowed to welcome U.S. investors if they brought improvements to the area.

“If there’s work for the people of the region, we’re delighted,” said Elvira Arroyo, a 43-year-old local vendor. Protests against foreign investors, she declared, were nothing more than politics.

So far, potential competition from the Mexican or other rail projects does not seem to be worrying the people who run the Panama Canal. Richard Wainio, planning director with the Panama Canal Commission, said the projects don’t appear to be practical alternatives.

The only challenge to the canal’s business, he said, has been the much-improved U.S. train system, which whisks cargo from Long Beach and other West Coast ports to U.S. cities.

“It makes no sense . . . to offload your box, put it on a rail system and reload it on another [ship] when you could drop it off in L.A.” and have the goods reach their destination in three or four days, he said.

Still, the canal is taking no chances.

It plans to spend $1 billion over the next eight years to expand its capacity by 20%. It is also developing designs for a third set of locks that could handle larger ships in the next century.

With only a touch of smugness, Wainio notes that the canal practically put the Tehuantepec Railroad out of business in 1914. Neither Mexico nor the other countries are about to reverse history, he said.

Once again, “Panama is light-years ahead of these people,” he said.

Mexico City Bureau researcher Helena Sundman contributed to this report.