Panama will soon become one of the key transshipment points in the world. Colon is already the largest port complex in Latin America, handling 1.3 million teus ( twenty foot equivalent unit) per year, according to UN'S ECLA.

With its Canal linking the two greatest oceans, Panama has always been very aware of its advantage in having a unique geographical position, but making the most of this attribute and establishing the country as an important point for cargo handling has taken longer than it should. This was due to a number of factors beyond Panama's control. The first was the operation of the Panama Canal as a U.S. government agency.

With the opening of the Canal in 1914, the two major deep water ports of the country became Balboa, on the Pacific side of the Canal and Cristobal on the Atlantic side. The old Panama Canal Company, and later the Panama Canal Commission, looked upon these ports as simply adjuncts to the Canal itself, firstly for the convenience of Canal customers for servicing their ships, such as with coal and later bunker fuel and, secondly, as ports for the movement of cargo in and out of the Republic of Panama. The Canal Company did not look upon the ports as commercial operations which could be commercialized, modernized and expanded.

Meanwhile, the Colon Free Zone, on the Atlantic side of the Isthmus, founded in the 1940's, had grown into the biggest duty free zone in the western hemisphere despite the slow development of the ports.

After the signing of the Torrijos-Carter Canal Treaties and the handing over of the ports and the Panama Railroad in 1979, little changed. The succeeding military dictatorships and their civilian puppet governments clung to the ports and railroad and used them for giving jobs to their faithful for political ends. The railroad gradually ground to a halt for lack of funds and attention and the ports remained at virtually the same stage of development that had existed when they belonged to the Panama Canal Company.

It took the US military invasion of Panama in 1989, the destruction of the Panama Defense Force and the installation of the civilian government of Guillermo Endara Galimany to change the course of the ports.