Plans for the Panama Metro line 3 have begun with the presentation of an environmental impact study and discussions for project financing.
The impact study estimates the total cost of the approximately 26.5-kilometer line to be US$2 billion. The line will connect the Albrook neighborhood in Panama City to Ciudad Futuro in Panama Oueste with 14 stations and a bridge over the Panama Canal. The line is not expected to be complete for at least another five years.
Japan has shown interest in financing the project, with the Japanese Prime Minister Shinzo Abe meeting with Panamanian President Juan Carlos Varela at the most recent United Nations General Assembly in New York earlier this year.
Details of the financing are not finished, with several sources reporting financing between 2% to 2.5% over a period of 25 to 40 years with a 7 to 10 year grace period on the loan.
What Japan will receive in return for providing financing to the project is still not clear. Rumors have circulated that Japan is seeking a discount for its ships carrying natural gas through the Panama Canal. Japan is the fourth most frequent user of the canal, according to ship registration. Close to 70% of Japanese ships hoist the Panamanian flag, and some 40% of Panamanian ships hoist that of Japan.
Panama City recently opened the first line of the Metro system, a first in Central America, costing around US$1.8 billion. The second line is now in the bidding process and is not expected to be complete for at least another four years. The second line is estimated to cost around US$2.2 billion, according to the Secretaría del Metro de Panamá.