In 1911 the imports into Panama from the United States amounted to £1,024,589, from the United Kingdom to £454,541, and from Germany to £223,845. France, Italy, and Spain exported to Panama smaller quantities. The exports from Panama to the United States amounted in 1910 to £301,684 (1911, first six months, £150,990); to the United Kingdom, to £33,055 (1911, first six months, £15,921), with smaller values to Germany and France. The reader will be interested to learn what sort of things Panama exports. Here, then, is a list of the principal exports for 1910, the last full year available:—
The United Fruit Company has now, in the province of Bocas del Toro, 32,000 acres of bananas under cultivation and 1,000 acres planted in cacao, with about 165,000 trees; the bananas being exported to the United States, and the chocolate to the United States and Europe. There should be a considerable increase in rubber production during the next few years, as 150,000 rubber trees have been recently planted in this province, and these will soon be ready for tapping. Nearly all the rubber exported at present is taken from the wild trees growing in the virgin forests of this province. A curious article of exportation is the ivory nut, or tagua, which in value now comes next after bananas. These nuts are collected by Indians on the Caribbean coast, brought to Colon, and there bought by merchants and shipped to New York and Hamburg. They are used to make the big buttons which are now so fashionable, and probably a good many English girls who are wearing coats "made in Germany," are carrying about a number of these ivory nuts which not long ago were lying on the tropical shores of the Caribbean. The timber exports from Panama would grow rapidly with proper exploitation. Exports of mahogany, cedar, and cocobolo have already begun.
The gold exports come mainly from the mines of the Darien Company, a French company which has been working for years. The whole isthmus is strongly under suspicion of gold. All the streams show evidence of it, and prospectors are always searching the Darien country and the provinces of Los Santos and Veraguas for the saint-seducing metal. No other minerals are worked in the isthmus. There are "coal-deposits" of a sort in the canal zone, but the coal is of no commercial value.
The only railway at present existing in the republic is that between Colon and Panama, the entire stock of which is owned by the United States government, and is worked as a company under the laws of the state of New York. This line, which has had to be largely reconstructed owing to the course of the new canal, was opened in 1855. It is rather surprising that it should not have been more extensively employed for traffic between the Atlantic and Pacific coasts of America. As a matter of fact, it was the main highway of transcontinental traffic until 1869, when the Missouri River was first linked up with the Pacific coast by the Union and Central Pacific Railroads, and the first continuous line across the States came into existence. After that date the traffic fell off very rapidly. The causes of this decline are various. To begin with, the great trunk-lines across the States competed ruthlessly with the old isthmian route, getting control of the Pacific Mail Steamship Company, which was for long the only regular line between the west coasts of the United States and Panama. Then the French and American construction work has seriously interfered with the route by limiting the amount of commercial freight that could be handled across the isthmus.
Another cause of depression has been the opening of the Tehuantepec route in South Mexico. In 1906 the American-Hawaiian Steamship Company made an agreement with the Tehuantepec National Railway, which runs across the isthmus, and withdrew its vessels from the old Magellan route, establishing regular services between New York and Puerto Mexico on the Atlantic side, and on the Pacific between Salina Cruz, the Pacific terminal of the canal, and the west coast ports of the United States and Hawaii. The route so organized was opened in 1907, and has proved very successful, chiefly owing to the enormous increase in the sugar exports from Hawaii. The intercoastal traffic by Tehuantepec from New York to Pacific ports advanced from 114,900 tons in 1906 to 295,800 tons in 1911, and from Pacific ports to New York from 32,000 tons in 1906 to 162,500 in 1911.
All this competition hit the Panama route very badly. The Atlantic to Pacific traffic by that railroad rose from 25,914 tons in 1906 to 46,394 tons in 1910, and the Pacific to Atlantic from 24,937 tons to 32,482 tons between the same years. But in 1911 there came a sudden expansion to 96,420 tons (Atlantic to Pacific), and to 115,508 tons (Pacific to Atlantic), owing largely to the development of shipping services on both isthmian terminals. In fact, the commercial freight has had to be seriously held up and restricted in the interests of canal construction and the shipment of canal material.
The reader will perhaps ask whether the Tehuantepec route is likely to compete seriously in the future with the Panama Canal. The distance from New York to San Francisco is 1,016 nautical miles less via Tehuantepec than via Panama, and from New Orleans 1,573 miles less. The difference to Honolulu in favour of the Tehuantepec transit is almost exactly the same. But the difference in time will be a good deal less than these figures indicate. The cargo has to be transferred from shipboard to railroad on one side of the isthmus of Tehuantepec and retransferred on the other. This means on the average about four days' delay. At Panama, a vessel can pass through the canal in half a day, or, reckoning other causes of detention, coaling, etc., the total isthmian transit should not take more than one day. Then there is the question of expense. The cost of transferring freight at Tehuantepec could not be less than $2.50 per cargo ton. A Panama toll of $1.20 per vessel ton, net register, would be equivalent to about $0.60 per cargo ton, giving Panama an advantage of $2 over Tehuantepec. And the inconvenience and damage resulting from transhipment, from which a through service through the canal is free, will also be a considerable point in favour of the waterway. It is not likely, however, that Tehuantepec will be ruined by the opening of the canal. Considerable short-distance coasting trade is sure to continue along that route, and it will share in the general benefit of the developments which await Isthmian and Central America.
Has Panama any danger to fear from its old rival the Nicaraguan canal project? The United States seems to have forestalled this possible challenge of Panama's monopoly of water transit over the isthmus. Just as I write comes the news of a new treaty between the United States and Nicaragua, securing to the former, for the payment of $3,000,000, the exclusive rights to construct a canal through Nicaraguan territory. The United States are reported also to have obtained under the treaty possession of Fonseca Bay, one of the few places on the west coast of Central America affording ample deep water facilities.
Moreover, the Colombian Chargé d'Affaires in London recently made the following communication to the press:—