What happened with the Molejón mine, which was under the responsibility of Minera Petaquilla, thanks to a law contract granted in the administration of Ernesto Pérez Balladares (1994-1999), obliges the country to make a thorough review of the concessions for this activity. It was precisely a PRD government that signed the contract with the mining company, […]
Panama will install one million square meters of solar thermal technology in its hotels by 2050, in order to reduce Carbon Dioxide (C02) emissions into the atmosphere, it was revealed on Friday. According to the Panamanian Association of Hotels (APATEL), the initiative is part of the project carried out by Termosolar Panama through an […]
The Panama Maritime Authority (AMP) communicates that the actions taken to safeguard the labor rights of the eight (8) Panamanian crew members who were on the ship “NISSI COMMANDER I” of the Mongolian Ship Registry, as well as the eighteen (18) crew members of other nationalities who were on board ships belonging to the […]
The area of Central America is well-renowned among the set of dedicated, almost obsessive, hobbyists called birders. With more species of birds and trees than any other area of the world, Central America is the destination among destinations for those seeking to locate the elusive as well as the resplendent nature travel experience. Before advocating […]
Panama raised capacity on public transportation across the country Monday, a day after celebrating the first day in 14 months without a COVID-19 death. The pause in COVID-19 deaths came despite a slight rise in confirmed infections that led to quarantines being imposed in two western provinces. On Sunday, Health Minister Luis Francisco Sucre announced […]
The hull of the former amphibious warship Bonhomme Richard (LHD-6) is in the Caribbean Sea after transiting the Panama Canal, according to data from ship tracker Marine Traffic. The tug MV Nicole Foss, which is pulling the hull, is now moving toward its final destination in Brownsville, Texas. The pair had reached Panama on May 5 before transiting the […]
Low-cost carrier Wingo is expanding its presence in Costa Rica with flights from the San José area to Panama City (PTY). The budget airline plans to fly twice weekly between the two Central American capitals starting June 21, according to a press release from the company. The route is part of an expansion that also […]
There are few better places to run Procter & Gamble’s growing Latin America business than the Costa del Este neighborhood of Panama City. A mix of corporate offices and highrise residential towers on the edge of the Pacific, it’s attracting a diverse set of international companies, including 3M, AES, Nestle and Samsung. “In Panama we have found a business-friendly environment with an open-door policy,” says Juan Fernando Posada, P&G’s president for Latin America. The Central American nation is best known for its eponymous canal, a majestic symbol of global trade, through which flows 5% of all the world’s goods. But Panama is much more than just a place to pass through, as its central location, modern trade infrastructure and economic and political stability have combined to create a strong draw for foreign businesses seeking to build regional trade operations or manufacturing hubs. In 2007, Panama’s legislature passed a package of corporate tax, labor and immigration benefits that have led 175 multinationals to establish regional headquarters in Panama, accounting for $1.2 billion in investment. In a sequel of sorts, in February, Panama enacted a second set of rules that extended those benefits from headquarters operations to manufacturing facilities. Companies Participating in the Multinational Headquarters Regime (SEM) 175 total!! “There are definitely very clear factors that made Panama a good decision to strategically locate our Latin America HQ,” says Posada. “The economic and political stability that the country enjoys, security, its financial services and definitely the easy air interconnection with the rest of the region.” Juan Fernando Posada, President P&G Latin America Procter & Gamble was the first multinational firm to move its Latin America headquarters to Panama under the 2007 Multinational Headquarters regime (known locally as the SEM regime, per its acronym in Spanish). Multinationals locating regional headquarters in Panama pay reduced income taxes for services rendered, and zero dividend taxes. “It makes it easier for multinational companies to bring their executives and trusted personnel to Panama,” says Ramon Martinez de la Guardia, Panama’s Minister of Commerce and Industries. For P&G, relocating 500 families to Panama from several Latin American countries “was a big challenge, but we got a lot of support to make it as smooth as possible,” says Procter & Gamble Senior Vice President Carlos Giraldo His Excellency Mr. Laurentino Cortizo CohenPresident, the Republic of Panama “Panama has a great advantage due to its geographic position. We have the best air and maritime connectivity in the region. And we just signed with Google for a submarine cable that strengthens our role as a digital hub.” Of course, the SEM regime would not have been such a success if Panama—located smack-dab in the center of the Western Hemisphere—wasn’t already an ideal location for world trade. The story naturally begins with the Panama Canal, which handled a record 13,785 ships from 160 countries in 2019, before the pandemic struck. Since control of this century-old engineering marvel was assumed by the Panamanian government in 1999, the focus has shifted to making the country not just a place where business simply passes through, but also a place where business gets done. PANAMA: AT THE CENTER OF THE WORLD Panama City’s Tocumen International Airport is considered the hub of the Americas, with 90 connections to 34 countries. Any location in Central America, Colombia and Venezuela is one to two hours away; Miami is three hours away; and many U.S. and South American locations can be reached in under six hours. The airport is located so conveniently within Panama City that Giraldo leaves his home at 9 a.m. to catch a 10 a.m. flight. Panama also boasts five other airports, five major seaports (including the busiest container port in Latin America) and a railway that functions as a dry canal, connecting the Atlantic to the Pacific. Since 2008, science-based technology company 3M has had a factory, logistics hub and operations center in Panama. “Our access to raw materials is much faster than in other places in Latin America, and it’s an ideal place to consolidate and export merchandise to our distribution centers in the region,” says Enrique Aguirre, Director of 3M for Central America and the Caribbean. “It’s also easy to distribute to Central American countries by land.” We decided to establish in Panama due to its economic and political stability, security, strategic geographic location and the availability of highly qualified professionals. This country has excellent conditions to attract investments.” Tom SweetCFO, Dell Technologies The underlying political and economic infrastructure that keeps commerce flowing smoothly is just as essential as all the cranes and vessels in Panama’s ports. Panama has enjoyed free and fair elections for more than 30 years, and has a dollarized economy with almost no inflation over the last century. Supported by a well-developed international banking system, the nation’s economic growth hovered around 7% for 15 years prior to the Covid crisis, leading the rest of Latin America. “Legal stability is very important—you have to compare that to the rest of the countries in Central and Latin America,” says Aguirre. “The rule of law is clear. And U.S. companies feel very comfortable here, perhaps because of the history the two countries share.” A SALVE FOR TRADE TROUBLES The global trade outlook has clouded in recent years, as tensions have grown between the U.S. and China and various disasters have disrupted supply chains. As a protective measure, more global companies are nearshoring—moving manufacturing closer to places where the goods will be sold. In February, Panama enacted regulations for the new Manufacturing Services for Multinationals regime, locally known as EMMA, “to take advantage of the nearshoring trend,” says Minister Martinez. EMMA brings the tax, labor and immigration benefits of SEM to global manufacturers, and eligible companies are exempt from taxes, fees and import duties on all goods and raw materials. Trade disputes and the Covid pandemic have demonstrated the dangers of overdependence on any one country in the supply chain, notes Martinez. With multiple means of connecting to 1.3 billion customers globally—and with 22 free-trade agreements involving 60 countries—Panama is perfectly positioned for nearshoring. “We have proudly been involved in the Panamanian market for many years and we have seen the nation evolve into a digital hub for Latin America. I look forward on continuing this productive partnership.” John MaloneChairman, Liberty Media Corp For Asia-based companies, Panama is an ideal location to finish products for export to Latin America, North America or Europe, and American companies can use Panama to finish products for export to Latin America, Europe or Asia. In either case, EMMA offers incentives for manufacturing, logistics services and R&D, just as SEM did for so many corporate headquarters. Since the EMMA regulations took effect in February, Martinez has already fielded inquiries from 10 companies for manufacturing operations in industries including pharmaceuticals, automotive assembly and cosmetics. When 3M built its factory in 2008, “there wasn’t too much manufacturing in Panama,” says Aguirre. Since then, 3M has trained an entirely local workforce for the factory, which produces car care solutions for the global market. “More companies have established here, and now, with EMMA, there is a great incentive to attract more,” he says. EMMA also incorporates new labor provisions that allow partners and spouses declared under either regulatory regime to obtain permits to legally work in the country using their same special migratory visa. Even before EMMA took effect, South Korean electronics giant Samsung chose Panama City as its operational hub for Central America, the Caribbean, Ecuador and Venezuela. Its new depot in the Panama Pacifico zone will ship spare parts to all of Latin America. “Panama has been successful in establishing a robust institutional framework and a favorable economic environment that enable businesses like ours to grow,” says Jae Hoon Kim, chief executive of Samsung’s Panama and Zona Libre subsidiaries. “The economic and political stability, strategic location, and the special regimes that Panama offers have enabled us to maintain highly skilled, enthusiastic and ethically impeccable workers.” MODERN LIVING With modern skyscrapers, luxury hotels and even artificial islands, Panama City has been labeled Latin America’s Dubai. With its laser focus on trade, it’s also been compared to Singapore. But Panama, home to both cloud forests and palm lined beaches, is unmistakably a Latin American country. With the region’s fastest-growing economy, Panama’s thriving domestic market also helps attract multinational firms. “Our investments in greener and innovative energy solutions in Panama are contributing to the country’s sustainability goals and diversifying the grid. They’re also creating an energy hub that will allow Panama to supply energy to diverse sectors and accelerate the transformation of the Central America and Caribbean energy markets.” […]
After the announcement of the Bill that creates the Program for the Modernization of the Logistics Services Infrastructure in the Colon Free Zone in Panama, local businessmen believe that more attractive incentives should be sought. Last April 28, the Assembly reported that the Minister of Commerce and Industries, Ramon Martinez presented to the plenary of the Legislative […]
Smartphones, tablets, video game consoles, internet servers, electric car batteries, all-purpose appliances, and even space rockets are charged with copper. Writes Rodrigo Noriega in La Prensa Throughout Latin America, States are facing dramatic fiscal crises that force them to review taxes and public expenditures to settle accounts. In those countries where mining is an important […]