Panama Scandals - The Bankruptcy

The Bankruptcy

On 4 February 1889, the Tribunal Civil de la Seine lawfully applied for the winding up of the Panama Canal Company in Paris. The work on the isthmus was stopped in the meantime. The lawfully ordered liquidator tried to maintain the work carried out, the buildings, the tools and the machinery. However, within a few years, high losses were incurred due to poor means of protection in the damp, warm climate. The French government pushed the completion of the liquidation further and further away, because the take-over offers of the various American companies seemed too small. An intermediate company was unable to be founded since the necessary capital failed. The liquidator appointed a commission to continue the canal project examination. The commissions report advised in 1890, the continuation of the sluice canal and the renewal of the contract with Colombia. The same year it succeeded in agreeing on a new contract in Bogotá, which was limited until 1904, on the same basis as the concession contract agreed on in 1878.

A concluding picture of the bankruptcy was first formed in 1892. Some 800,000 French people, including 15,000 single women, had signed for stocks, bonds and founder shares from the Panama Canal Company, to the sum of - the then considerable amount of - approximately 1.8 billion gold Francs. From the nine issues the Panama Canal Company received 1.2 billion gold Francs, 960 million gold Francs of which were invested in Panama.