Panama's two grand plans -- to expand the Panama Canal and to build a huge commercial port -- might be incompatible, managers of the Canal said Tuesday, but port promoters say there is no conflict.

"There is no room for another Pacific port in Panama, and no need to spend millions of dollars from the public infrastructure budget to build a new one," said Rommel Troestch, marketing director of the Panama Ports Company (PPC), a division of Hong Kong-based Hutchison Port Holdings.

PPC runs Colombia's Balboa port on the Pacific and Christobal on the Atlantic.

The port, proposed to be built in the Palo Seco-Farfan area, close to the Canal's Pacific opening, will cost around 850 million U.S. dollars at the first stage.

Studies by the Panama Canal Authority (PCA) show that a boost in Canal capacity will lead to an increase in shipping demand that will eventually lead to a greater need for port capacity.

However, Rodolfo Sabonge, planning director of the Panama Canal Authority (PCA) argued, "The project for a mega port as it stands is closely linked to rising volumes of container traffic in the Canal, and that will only be seen if the Canal-improvement work is achieved."

The proposed Canal expansion is estimated to cost eight billion dollars.

Rogelio Orillac, director of ports for the government's Panama Maritime Authority who supports the idea of building the commercial port, said that the proposed port could compete alongside Panama's other ports without friction, taking advantage of rising trade volumes between Asia and the United States.

The canal authority has declined to name a figure for the spending, which has been demanded by shipping companies who want to use vessels bigger than the so-called Panamax, the largest size that will fit in the canal, which is 965 feet long, has a draught of 39.5 feet and a width of 106 feet.

The Authority is due to present the final technical study on Canal expansion to Panama's cabinet in a few days.

Panamanian President Martin Torrijos said recently that the country would hold a referendum on the issue before the end of 2006.

Source: Xinhua