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Tunneling Through The Andes To Speed Global Trade

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As it stands, the only major Andean pass in the southern half of the continent is snowed in each winter, stranding hundreds of cargo trucks in temperatures that can fall to minus 13 degrees Fahrenheit (minus 25 degrees Celsius). And Pacific ports remain inaccessible to the Atlantic nation of Brazil, whose trans-Amazonian highway becomes a boggy mess even before reaching the mountains.

“There is a gigantic network of infrastructure on both sides of the mountain range with a bottleneck we must free up,” said engineer Nicolas Posse, who is directing the project for Corporacion America.

The Argentine company leads a consortium that proposed the project, and both governments have committed to it as a matter of “national interest,” creating a binational commission that is inviting bids. Initial feasibility studies have already been submitted.

Currently, much of the processed soy oils, wine and meat Argentina sends to China, as well as Asian electronics destined for Brazil, must first sail around the tip of South America, adding nearly 3,000 nautical miles and another week to the trip. Shipping by rail between Atlantic and Pacific ports would unite the most productive regions of Chile and its South American neighbors, making trade more competitive for all involved.

The shipping cost would drop from $210 to $177 a ton for cargo that now moves between Cordoba, Argentina, and Manzanillo, Mexico, the closest major port with direct rail links to the eastern United States.

“This project is just what’s needed,” said Mauricio Claveri, an economist with the Abeceb.com consulting firm in Buenos Aires.

He called it a strategic necessity for the Mercosur nations of Argentina, Uruguay, Paraguay, Brazil and Venezuela to develop more efficient trade links with China, Japan and Southeast Asia.

Trucking company owner Ivan Caccia’s eyes light up when he calculates his potential savings from the tunnel, which promises to reduce the Andean passage from 12 hours to just 2 1/2 hours.

Each trip Caccia & Sons trucks make carrying wine and fruit between Argentina’s Mendoza province and Chile’s capital of Santiago costs $1,400 and takes two days. With the tunnel, it would cost just $840 and his trucks could make it there and back in the same day.

“The economic part of this project is important, but also the human aspect, because having a truck driver stuck in the snow for three or four days isn’t very pleasant,” he said.

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Posted by FanningCommunications on Nov 1st, 2012 and filed under News. You can follow any responses to this entry through the RSS 2.0. You can leave a response by filling following comment form or trackback to this entry from your site

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