Two potential new developments in Central America could have a huge long term impact on the region and world trade. Panama is set to expand and improve its canal zone and Nicaragua is stirring the pot by proposing to build their own canal:
If built, the Inter-Oceanic Nicaragua Canal would cut time and several hundred miles off the route from China to Europe or North America.
It would also carry super-ships of up to 250,000 tonnes, significantly bigger than the vessels that currently pass through Panama.
Nicaragua has long held dreams of its own canal and was considered a potential route before the Panama waterway was constructed.
Panamanians will vote in a referendum on 22 October on whether to upgrade their canal, in what would be the biggest expansion since it opened in 1914.
Some modern ships are now too wide to go through the canal, and those ships that can pass have to queue for hours.
Under the proposals, wider locks and deeper and wider access canals would enable the canal to take ships carrying up to 10,000 containers. At present the limit is 4,000 containers.
However, critics argue that when the work is finished in 2014-15, the Panama Canal will still be inadequate, causing it to miss out on business.
The 80km (50-mile) waterway, which is used mainly by the US, Japan, China and Chile, currently handles nearly 5% of global trade.
Meanwhile in the former Soviet Union tensions are building between Moscow and the government of Georgia:
Tension rose in the past week when Georgia detained, then released, four Russian army officers for spying.
Russia has imposed a travel and postal ban between the two countries.
“I would not advise anyone to talk to Russia in the language of provocation and blackmail,” Mr Putin said in the Duma. “I am talking about Georgia here.”
The motion passed by the Duma accuses Georgia of violating human rights and advocates further economic and financial sanctions.
Moscow has ignored a call from the EU to lift the transport and postal ban imposed on Georgia, and may go even further.
One possible new sanction is the adoption of a bill that would prevent Georgians living in Russia from sending money home.
Estimates vary but it is believed that at least one million Georgians – both Georgian and Russian citizens – currently live in Russia.
Georgia’s own population is about five million, and many families depend on remittances sent by relatives from Russia.
Russian sanctions could take 1.5% off Georgia’s GDP this year, Georgia’s minister for economic reforms, Kakha Bendukidze, told Reuters news agency.
Closer to home we have a little coverage on how farmers game our agriculture support program:
The porous and poorly enforced limits are one reason why government payments to farmers have jumped more than fourfold in the past 25 years. Last year, subsidies cost $23 billion, almost all from taxes — the equivalent of 7 percent of the federal budget deficit.
Payment limit abuse is a particular problem in Georgia and other cotton-growing states. Cotton costs more to grow than most other crops and generates higher subsidies, pushing more farmers up against the legal limits.
Small farmers are at a disadvantage in the complex subsidy system and are often forced to circumvent the rules just to compete:
Time and again, Georgia farmers complained to The Atlanta Journal-Constitution that the temptation to circumvent payment limits thrust them into an uncomfortable moral dilemma.
“It makes farmers feel like they are doing something illegal,” said Tim Shirah, a fourth-generation farmer from Mitchell County. “You are going to use the law to circumvent these limits. You don’t want to do it, but you do it out of necessity.”
Of course, for some of us the most tragic item of the day comes last:
Federal investigators were set Tuesday to begin an investigation into a fire that ruined about 4 percent of America’s yield of hops, used as flavoring in the brewing of beer and ale.
The fire started shortly before noon Monday in a 40,000-square-foot (3,600-square-meter) warehouse operated by S.S. Steiner Inc., one of the four largest hop buyers in the Yakima Valley of central Washington. By mid-afternoon flames engulfed most of the building, sending up plumes of smoke and a pungent aroma.
The fire destroyed or ruined about 10,000 bales, each weighing about 200 pounds (90 kilograms) and likely worth $1.75 to $2 a pound, Ann George, administrator of the Washington Hops Commission in nearby Moxee, told the Herald-Republic.
The last two items come I found courtesy of Division of Labor, a great blog.
[tags] Panama canal, Nicaragua, Putin, Russia, Georgia, farm supports, hops, beer, brewing, agriculture [/tags]
Russia continues to slide backwards into authoritarianism, or, for another scenario, back up the left side of the stability J-Curve. Putin is picking fights with his weak neighbors both to appeal to ugly Russian nativism/nationalism, and for the actual benefit of subverting his neighbors. Russia wants to be surrrounded by acquisent dictators such as Belarus and Uzbekistan, not by democracies. The former pairing allows them to look better and get away with more.
I support open confrontation with Russia. Hell,I support a couple hundred US troops in Tbilisi. Just to make a statement. One that will probably endear us to the Georgians, I think. We could use that.
Warmonger;^}