The insurer Zurich provides a solution to the conflict in Canal

Question

The parties close positions in the conflict over the redevelopment of the Panama Canal. Swiss insurer Zurich, responsible for guarantees on the work submitted to the Panama Canal Authority (ACP) and the consortium led by Sacyr a proposal for mediation to solve the financing of the works, according to sources familiar with the negotiations. Zurich offers convert bonds of 600 million dollars (440 million euros) in loans to the consortium Grupo Unidos por el Canal (GUPC).

For its part, the ACP should waive the requirement for now the repayment of advances and facilitate the party has not paid the total budget, which is around 3,300 million after the revisions for materials and labor. For now, the ACP has paid 2,048 million dollars for certification (which equates to an increase of 66 % of the work) and given advances by 780 million (whose return would be postponed). It would therefore be around 500 million dollars available budget.

With the $ 600 million provided by the consortium and Zurich 500 to disburse the ACP, the works could regain its rhythm (now very slowed down) to end in 2015. Zurich would a security risk to other credit, Channel disburse no more than your budget and endeudarÃ_a GUPC is pending that instances of the contract or international arbitration will recognize all or part of the additional costs, the consortium has estimated at $ 1,625 million (1,200 million euros).

The parties were combined to study this proposal and its fringes. In a recess, the Canal Administrator Jorge Quijano, said there was a " proposal that can give long -term solution," an apparent reference to the proposal of Zurich, according to Efe from Panama City.

As stated by the news agency Quijano, nothing is decided. "We are still airing between us separately and together " the proposal " that brought the parties" to the negotiating table, he said without elaborating.

The proposal is being evaluated in a meeting between all parties involved. The consortium led by Sacyr building the Panama Canal expansion, the managing authority of this pathway and Zurich, the insurance project, Panama are gathered. The meeting takes place after the builders decided Monday to continue working despite the conclusion of the term of the ultimatum to resolve the problems arising from the extra cost of the works.

Likewise, the meeting is held once the Grupo Unidos por el Canal reiterated their willingness to reach an agreement to ensure the completion of the project presented a new proposal to address liquidity mismatches of work. Contractors have proposed to the Panama Canal Authority (ACP) co-finance 100 million dollars (73 million euros) a month of running the works.

Additionally, the trilateral meeting in Panama occurs after the vice president of the European Commission and Commissioner for Industry, Antonio Tajani, agreed to mediate the dispute.