Panama renewed an agreement on maritime transport with China, granting more advantages for ship owners who have registered their vessels under its flag, the Panamanian Embassy to Korea said in a statement.

The agreement, which was first signed in May 2018 for three years, was renewed and came into effect July 20 after negotiations between the Panamanian and Chinese governments.

The maritime transport agreement strengthens trade between the two nations as well as offering benefits to ships under Panamanian registry when they enter ports in China.

Panama has the biggest registry of ships sailing under its flag, as the country’s open system offers easier registration, cheaper foreign labor and no income tax.

As of 2020, 9,596 out of 56,000 ships in the world’s merchant fleets, or 17 percent of the total, were under the flag of Panama. Most merchant ships flying the Panamanian flag belong to foreign owners who wish to benefit from Panama’s ship registry program and convenient international maritime trade.

HMM Algeciras, Korea’s largest container vessel owned by HMM, also flies the Panamanian flag.

The renewal of this agreement represents a series of unique advantages for ship owners that have registered their vessels under the Panamanian flag, such as measures to facilitate and expedite maritime transport to avoid unnecessary delays; promoting maritime and port development; ensuring the safety of navigation and protection of the environment; improving business relations and scientific and technological exchanges; promoting the supply of services to Panama-flagged vessels; and maintaining close relations that allow free and unimpeded access of Panama-flagged vessels for cargo traffic to and from China.

The agreement is based on equality, mutual benefit, freedom of navigation and the principle of non-discrimination for Panama-flagged vessels operating in Chinese ports.

Source: The Korea Times

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