The Panama Canal closed its fiscal year 2018 with a record tonnage, welcoming 442.1 million Panama Canal tons (PC/UMS), a 9.5 percent increase over 2017. We expect a moderate growth in traffic for fiscal year 2019, since significant changes are expected to impact world trade. Because of uncertainties arising from greater protectionism, the International Monetary Fund has projected global growth rate at 3.7 percent in October 2018, a 0.2 percent decline with respect to the 3.9 percent published in April 2018.

Given this outlook for FY 2019, the Panama Canal has taken into consideration all possible scenarios to be prepared for a possible impact. We will continue to monitor our traffic and will make adjustments as they become necessary.

The Panama Canal is not immune to market variations that result from deviation of global free trade practices. Historically, the Panama Canal has witnessed a number of economic cycles and crises, which have had some but not profound effect in the performance of the waterway. With the diversification of more than 144 routes worldwide, it is not unusual to have some routes compensating others that are having economic difficulties or geopolitical stress. We will continue to seek new markets and innovate to find better and more efficient ways to handle our traffic, thus preserving and even enhancing the value and reliability of our route.

We will monitor the implementation of IMO 2020 to enforce a 0.5 percent global sulfur cap on the industry, as well as the growing digitalization, e-commerce, blockchain, and autonomous shipping. It is also important to keep track of alliance restructuring, additional line consolidations, and larger vessel deployments, which have a potential effect on port calls and interport competition.