Updated 04:11 AM EST, Thu, Nov 26, 2020

Group Behind Panama Canal Expansion Project Under Investigation for 'Defrauding the Nation's Resources'

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The group behind the canal expansion project in Panama is currently under a criminal investigation for allegedly increasing its cost overrun.

The National Bar Association Vice President Juan Carlos Arauz filed the complaint on Thursday with Panama's Attorney General's Office, Fox News Latino reported from EFE.

According to the lawyer, they are seeking for an investigation "into the possible defrauding of the nation's resources" through the presentation of "unjustified" economic claims made by the Grupo Unidos por el Canal de Panama, or GUPC, consortium, led by Spanish construction company, Sacyr Vallehermoso, Fox News Latino added.

In 2009, the GUPC and the Panama Canal Authority, or ACP, signed a $3.1 billion contract for the construction of a third set of locks, the news outlet further reported. The International Chamber of Commerce's International Court of Arbitration is the last option for resolving contractual disputes.

The complaint indicated that there's still a chance that the ICC's International Court of Arbitration could rule in favor of the project's consortium, causing "serious harm to the Panamanian state," Fox News Latino noted. The consortium is seeking additional payments worth $3.5 billion for cost overruns.

The GUPC, on the other hand, accuses the ACP of trying to pay an amount lower than the real value of its bizarre costs, Fox News Latino added.

Panama's President Juan Carlos Varela announced recently that the expanded Panama Canal will be inaugurated "around May," Yahoo! News reported from AFP. The canal is projected to accommodate larger ships and up to 600 million tons of cargo each year, doubling its current capacity.

The GUPC began the expansion work on the waterway in 2007, Yahoo! News noted. The extensions were initially intended to be completed in October 2014 but were then delayed to April 2016. Varela's announcement signified that construction is once again pushed back; this time to May 2016, indicating that the project is well behind schedule.

In addition, Varela said it was "imperative" to begin a study on the development of a river basin that will provide water supplies for human use and for the canal's function, Yahoo! News added.

The Panama canal expansion will allow huge new ships to pass through the trade route, and could move the flow of goods and products from the United States West Coast to the East Coast, the Globe and Mail wrote. The canal's expanded route will also give a chance to ports along the U.S. Gulf and Atlantic coasts to compete with their West Coast rivals for vessel traffic.

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