Panama is the carrier's hub for Latin America, with feeder services to Colombia, Venezuela, Puerto Rico, the Dominican Republic, Costa Rica and Brazil. The carrier's second route is via Mexico, which it serves with a weekly service from north Asia via Los Angeles. Volumes are about evenly divided between the Panama and the Mexican connections, but the latter has a larger share of APL's westbound traffic, Urban said. He is bullish about Latin America's growth potential and compares the region to southeast Asia some 10-15 years ago. However, he also warns about pitfalls.
Infrastructure is a big problem.
There are some improvements, especially as governments gradually open doors to private operators that develop or take control of cargo facilities, but on the whole they're moving too slowly to keep up with the growth in business, Urban said. Another recent major drawback has been mounting competition and its affect on rates. Competitive pressure has led to a 20 per cent decline on eastbound rates, but it is far more than that in some markets like Panama, he said. There is little chance that rates will go up again this year.