For the Beauty of Logistics: The Panama Canal Debate – Sovereignty and Pricing Fairness

Recent remarks by the U.S. President have brought renewed attention to the Panama Canal—raising concerns about rising tolls, treaty obligations, and foreign influence. Some have even suggested the U.S. should reassume control of the Canal.

In his latest piece for The Beauty of Logistics series, Monument Economics’ Dr. Paul Kent takes a closer look at the facts behind these claims:

  • What does the Neutrality Treaty really say?
  • Is Panama’s toll structure fair—or excessive?
  • How does the Canal’s financial performance compare to other global infrastructure operators?
  • And what about the oft-repeated claim of Chinese control?

Using public data, concession norms, and financial benchmarks, Dr. Kent’s article offers a grounded assessment of the Canal’s governance, pricing strategy, and strategic role.

Click here to read the full paper.

 

Comentarios recientes del Presidente de los Estados Unidos han vuelto a poner al Canal de Panamá en el centro del debate, generando preocupaciones sobre el aumento de los peajes, las obligaciones del tratado y la influencia extranjera. Algunos incluso han sugerido que EE. UU. debería retomar el control del Canal.

En su artículo más reciente de la serie The Beauty of Logistics, el Dr. Paul Kent, de Monument Economics, examina con mayor detalle los hechos detrás de estas afirmaciones:

  • ¿Qué dice realmente el Tratado de Neutralidad?
  • ¿Es justa la estructura tarifaria de Panamá, o resulta excesiva?
  • ¿Cómo se compara el desempeño financiero del Canal con el de otros operadores de infraestructura global?
  • ¿Y qué hay de la afirmación repetida sobre el control chino?

Utilizando datos públicos, normas internacionales de concesión y comparaciones financieras, el artículo del Dr. Kent ofrece una evaluación rigurosa sobre la gobernanza del Canal, la estrategia de precios y su papel estratégico en el comercio mundial.

Haga clic aquí para leer el artículo completo.

Dr. Paul Kent Releases Part 1 of His Paper, “Logistics Reimagined: Advancing the Intelligent Logistics System,” Under His For the Beauty of Logistics Series

Dr. Kent harnesses existing and emerging technologies to advance his Intelligent Logistics System (ILS) concept to tackle inefficiencies and challenges across global supply chains. By leveraging IoT, AI, Blockchain, Digital Twins, and PiChain, the ILS enhances efficiency, fosters transparency, and drives sustainability—ushering in a new era of logistics innovation. He demonstrates its application in a hypothetical scenario inspired by Brazil’s soybean logistics.

Part 1 can be accessed here. Part 2, coming soon, will delve into the challenges and opportunities for implementing the ILS at scale, exploring technical and financial barriers, such as data integration complexities, cost recovery mechanisms, and stakeholder alignment. Part 2 will also introduce the concept of a centralized technology management platform—the “system of systems”—to coordinate multiple ILS components.

Prior articles from Dr. Kent’s For the Beauty of Logistics Series can be found here:

Dr. Paul Kent Leads Freight and Supply Chain Analysis in the US Bureau of Transportation Statistics 2024 Annual Report

Dr. Kent, for the third straight year, was the primary contributor to the Freight and Supply Chain Chapter, posted here, of the US Bureau of Transportation Statistics 2024 Annual Report. Some of Chapter’s highlights include:

  • The U.S. freight system moved 20.1 billion tons of goods valued at $18.7 trillion in 2023. Trucking remained king, hauling 64.5% of the weight and 72.5% of the value.
  • Short hauls? Trucking dominated trips under 100 miles, accounting for 75% of ton-miles. Long hauls? Rail took the lead on routes between 1,000–2,000 miles, with 37.8% of ton-miles.
  • In 2023, U.S.–Mexico trade rose 2.4% to $798 billion, overtaking U.S.–Canada trade ($772.9 billion) as the top bilateral partner for the first time. Meanwhile, U.S.–China trade fell 16.8%, underscoring evolving trade patterns.
  • The Liner Shipping Connectivity Index ranked the Port of New York and New Jersey as the top U.S. port for connectivity in 2023, with a score of 517—up from 506 in 2022. Meanwhile, West Coast ports like Los Angeles and Long Beach saw declines to 276 and 233, respectively, reflecting shifting dynamics.
  • East Coast ports handled 63.8 billion kilograms of Asian imports in 2023, surpassing the West Coast’s 55.0 billion kilograms for the second straight year. Over the past decade, East Coast ports achieved a CAGR of 5.5%, while West Coast ports saw a decline of −0.3%, emphasizing a long-term shift in containerized trade flows.

While this year’s data showcases remarkable trends, next year’s story may reflect ripples from recent disruptions: potential East Coast dockworker strikes, vessel re-routings avoiding the Red Sea, and drought-related navigation constraints on the Panama Canal. The U.S. coastal gap could narrow—or shifting trade patterns may surprise us again.

For a deep dive, the full report and a treasure trove of transportation statistics across all modes are available at https://www.bts.gov/tsar and https://data.bts.gov/, respectively.

Monument Spreads Holiday Cheer

As we look to 2025, the team at Monument Economics Group looks back on 2024 with gratitude. With great appreciation for our clients and our colleagues, MEG continues its tradition of making contributions to local nonprofits that take on the most meaningful work.

In addition to the organizations we’ve long supported, MEG put out a call to all employees to learn of nonprofits they hold dear and has made contributions on their behalves to these organizations. With this additional input, Monument made contributions to the following: So Others Might Eat and DC Scores in Washington, DC; Philabundance and Broad Street Ministry in Philadelphia, PA; My Dog is My Home in Ridgewood, NY; and Sunset Gap and United Way of Asheville in support of the Eastern TN and Western NC flood victims.

All of these organizations make a profound difference in their respective communities by combating hunger, homelessness, unemployment, and poverty, and improving mental and physical health. Monument takes great pride in supporting philanthropic endeavors who do such great work in our communities.

To learn more about these nonprofits:
So Others Might Eat, DC Scores, Broad Street Ministry, Philabundance, My Dog is My Home, Sunset Gap, United Way of Asheville

Honduras’ ICSID Withdrawal and What’s at Stake

Dr. Paul Kent has released the third paper of his For the Beauty of Logistics series. In it, he examines Honduras’ recent decision to withdraw from the World Bank’s forum for international arbitration, known as ICSID. Dr. Kent examines the impact of the withdrawal on current and future investment projects and highlights the critical need for diversified arbitration options to maintain investor confidence, with potential ramifications for other countries considering a similar decision. The article is available in both English and Spanish.

Click here to read the full paper.

Dr. Kent’s For the Beauty of Logistics series is a collection of short papers that reveal deeper insights in how logistics principles intersect with economic, policy, and infrastructure systems. Previous papers in the series include:

Gaza’s Port to Prosperity: Building a Sustainable Future Amidst Conflict – Monument Economics Group

From Nobel Laureates to the Cellular Supply Chain: Unveiling Logistics Concepts to Foster Wider Understanding of Scientific Research – Monument Economics Group

 

El Dr. Kent ha publicado el tercer artículo de su serie For the Beauty of Logistics. En él, examina la reciente decisión de Honduras de retirarse del foro de arbitraje internacional del Banco Mundial, conocido como CIADI. El Dr. Kent analiza el impacto de esta retirada en los proyectos de inversión actuales y futuros y destaca la necesidad crítica de opciones diversificadas de arbitraje para mantener la confianza de los inversionistas, con posibles repercusiones para otros países que puedan considerar una decisión similar. El artículo está disponible tanto en inglés como en español.

Haga clic aquí para leer el artículo completo.

La serie For the Beauty of Logistics del Dr. Kent es una colección de artículos cortos que revelan una comprensión más profunda de cómo los principios logísticos se entrelazan con los sistemas económicos, políticos y de infraestructura. Artículos anteriores de la serie incluyen:

Gaza’s Port to Prosperity: Building a Sustainable Future Amidst Conflict – Monument Economics Group

From Nobel Laureates to the Cellular Supply Chain: Unveiling Logistics Concepts to Foster Wider Understanding of Scientific Research – Monument Economics Group

Gaza’s Port to Prosperity: Building a Sustainable Future Amidst Conflict

In Dr. Kent’s second paper in his For the Beauty of Logistics series, he explores a unique setting for port development to serve Gaza: one that seeks to balance Israel’s security needs with Palestinian sovereignty aspirations. The paper presents five port options according to their locations: inside Gaza, on the border, and outside Gaza. The favored option, the South Gaza/Kerem Shalom plan, entails an autonomous Palestinian port to be constructed in Egypt, adjacent to Gaza’s border. This port will be connected to the existing Kerem Shalom border crossing terminal via a dedicated 10-km port truck corridor. Then, Kerem Shalom will be expanded and turned into a logistics hub and special economic zone connected by rail to the West Bank. The chosen port solution not only addresses security concerns, but also holds promise for significant economic improvement, offering hope for Gaza and a stable peace for this war-torn region.

Click here to read the full paper.

The For the Beauty of Logistics series, authored by Dr. Paul Kent, consists of short papers that aim to showcase how the principles of logistics can enable groundbreaking advancements, optimize processes, and revolutionize our understanding of complex systems. The first paper of the series, “From Nobel Laureates to the Cellular Supply Chain: Unveiling Logistics Concepts to Foster Wider Understanding of Scientific Research”, can be accessed here.