FREIGHT TRAINS were due to begin running on the Panama Canal Railway in mid-October, following a US$76m reconstruction and conversion to standard gauge. Passenger services resumed in July, using ex-Amtrak locos and coaches.

The complete overhaul of the 75·6 km route, including new ballast, sleepers and rails, has taken nearly two years. The rebuild has been undertaken as part of a 50-year operating concession awarded by the Panamanian government to Mi-Jack Products and Kansas City Southern Railway. The state will be paid 5% of gross revenue until the partners have recovered their initial investment, after which the levy increases to 10%. The company expects to break even in 2003.

Up to 10 container trains will run each way per day, formed of six 5-section double-stack wagons; the consortium is forecasting a total of 40000 boxes in the first year. Traffic could rise substantially after December 2002, when expansion at the port of Manzanillo is completed; two extra passing places are planned.