Motor vehicles transport most agricultural products. In 2002, there were 11,592 km (7,203 mi) of roads, of which about 4,079 km (2,534 mi) were paved, including 30 km (19 mi) of expressways. The principal highway is the National (or Central) Highway—the Panamanian section of the Pan American Highway—which runs from the Costa Rican border, via Panama City and Chepo, to the Colombian border. The 80-km (50-mi) Trans-Isthmian Highway links Colón and Panama City. Panama's rugged terrain impedes highway development, and there are few good roads in the republic's eastern sections. In 2000 there were 256,368 registered passenger cars and 138,490 trucks and buses.
Railway lines total 355 km (220 mi) of track, all governmentrun. The Panama Railroad parallels the canal for 77 km (48 mi) between Colón and Panama City. Other lines connect Pedregal, David, Puerto Armuelles, and Boquete and unify Bocas del Toro Province.
In 2002, the Panamanian merchant marine registered 4,838 ships, totaling 118,878,358 GRT. Most of the ships are foreign-owned but are registered as Panamanian because fees are low and labor laws lenient. International shipping passes almost entirely through the canal ports of Cristóbal, which serves Colón, and Balboa, which is the port for Panama City.
Panama is a crossroads for air travel within the Americas. There were 107 airports, 41 of which had paved runways in 2001. The most widely used domestic airline is Compañía Panameña de Aviación (COPA), which also flies throughout Central America. Air Panama International serves passenger traffic to the US and South America, and Internacional de Aviación (INAIR) is an international passenger and cargo carrier. Panama has two international airports, the largest, Tocumen International Airport in Panama City and the smaller, Omar Torrijos International Airport, 19 km (12 mi) east of Panama City. In 2001, 1,114,700 passengers were carried on scheduled domestic and international airline flights.
The Panama Canal—built during 1904–14 by the US Army Corps of Engineers, under Col. George Washington Goethals—traverses the isthmus and is 82 km (51 mi) in length from deep water to deep water. The great technical feat involved in constructing the canal was to cut through the mountains that span the region, dam the Chagres Lake, and then design and build the three sets of double locks that raise and lower ships the 26 m (85 ft) between lake and sea levels. The first passage through the canal was completed by the S.S. Ancon on 15 August 1914. On 1 October 1979 when the US-Panama treaties went into effect, the canal was administered by the joint Panama Canal Commission, on which the United States had majority representation through the end of 1989. The United States turned over complete control of the canal to Panama on 31 December 1999. The canal takes ships of up to 67,000 tons. An oil pipeline across the isthmus was opened in 1982 to carry Alaskan oil; its capacity is 830,000 barrels per day. The Bridge of the Americas across the canal at the Pacific entrance unites eastern and western Panama as well as the northern and southern sections of the Pan American Highway. Panama, the United States, and Japan have commissioned a $20-million study to search for alternatives to the canal. The feasibility of building a new canal at sea level is to be examined; alternatively, the Panama Canal Commission has indicated its intention to increase the width of the Gaillard Cut (Corte Culebra), since larger ships are restricted to one-way daylight passage, due to the narrowness. Panama also plans to consolidate the ports of Balboa on the Pacific and Cristóbal on the Caribbean into a single container terminal system.