The main challenges for LatAm ports

(This story was originally published on August 28)

Latin America's port sector is looking at a mixed bag going forward. Market conditions in China and a stronger US economy present both challenges and opportunities, while lurking environmental hazards are increasingly becoming the norm. Meanwhile, a series of integration projects under development will introduce new and dynamic modes of transport within the region. But one thing that hasn't changed is the need to double down on development in order to offer better quality services, says Julián Palacios, executive director of the Latin American Association of Ports and Terminals (Latinports).​

BNamericas: How is Latin America's port sector being affected by global markets, such as the strengthening US dollar and China's stock rout?

Palacios: This is not reflected immediately. You have to wait some time to see if the situation stabilizes. But what is certain is that the economic growth of Latin America in recent years has been below the world average. This also affects port projections.

BNamericas: What challenges does the industry face in 2016?

Palacios: Latin America finds itself lagging behind in industrial development, which puts it behind in competition with foreign commerce, making the region very dependent on developed countries. The challenge is always the same – to develop the industry to achieve high quality and competitive prices.

BNamericas: Which project deserves the most attention in the medium term?

Palacios: There is the tunnel between Argentina and Chile to facilitate the connection between the Atlantic and Pacific oceans. It will also positively impact Brazil and other neighboring countries. With the approval of both congresses, I think this could become a reality and boost commerce, logistics and bring down costs.

BNamericas: This year's El Niño weather system could be the strongest of the last six decades. What measures can be taken to protect the sector?

Palacios: Drought is a recurring issue, just as is flooding. With global warming, we're seeing these issues reach extreme proportions – extreme droughts and floods – not only in Latin America but in the entire world. Snow-capped mountains are melting, and this affects the rivers. If appropriate measures are not taken, we're going to face very critical problems in the future. There is awareness, but it's something that must be a continuous labor, with important investments on the part of the world's governments.