By Franklin Castrellón
The Panama Chamber of Shipping (CMP) has said they are satisfied with the implementation of the Logistics Office by the Panamanian government, and consider it a big step towards the ultimate goal of turning Panama into a regional logistics hub through “the establishment of the Consultative Council with the participation of the private sector”.
At a meeting on January 21, 2016, with representatives of the maritime and logistics industry, the ministers of the Presidency, Alvaro Aleman, and Commerce and Industry, Augusto Arosemena, presented the progress made to date by the Logistics Office, created by the current government through Executive Decree No. 881 of November 13, 2014.
Among the most notable achievements mentioned by Arosemena was the priority route of the logistics industry, designed with the support of the Latin American Development Bank (CAF) and with the approval of the Permanent Consultative Council with private sector participation, through Executive Decree 696 of October 21, 2015.
Executive Decree 696 added an article (7-A) to the decree that created the Logistics Office, whereby the Advisory Council is created “as a permanent consultative and advisory body of the Logistics Office.” This is composed of a representative of shipping services, trucking services, one air transport representative, one freight service representative and three private sector members appointed by the Executive.
Referring to the Logistics Cabinet and the objectives it has set, the executive director of the CMP, Luciano Fernandes, said that “these are very well regarded by the CMP”. He noted that “logically, as a private organization, we would like to accelerate the process a little,” but stressed that, definitely, “we have achieved a breakthrough.” He said the government is listening and together the private sector, “is aligning objectives of the country.”
“The start of operations of the third set of locks will open a world of opportunities,” Luciano Fernandes
Fernandes believes that while the scheme designed “may not be the perfect formula, it is working. We have knowledgeable people in the industry who are contributing their knowledge and experience in facilitating and creating plans and projects that encourage the development of the sector.
“We must expand infrastructure in answering questions from the government on possible measures that should be promoted by the Logistics Office to seize the opportunities that will open when the expanded Canal is operating”.
Fernandes agreed that the start of operations of the third set of locks “will open a world of opportunities.
“In order to take advantage it is our duty to maintain our position as a regional leader, and for this we must invest in infrastructure such as roads, rail and ports, among other things.”
Fernandes referred to the Corozal West port project which, in the opinion of the the CMP, “there is an urgent need to expand port capacity on the Panamanian Pacific coast.”
The project, whose development has attracted interest from twelve global port operators, is driven by the Panama Canal Authority (ACP).
To carry it forward, its operator will require the same tax benefits received by other transshipment port operators (Panama Ports, Manzanillo International Terminal, Colon Container Terminal and PSA International Terminal).
On the subject of pending actions to advance the maritime strategy, which aims to consolidate the regional leadership of Panama as a logistics hub and trade center, Fernandes warned that, unfortunately, the issue has not been adopted as “an agenda of state.” Reiterating that there is an excellent communication on this subject with the government, he said that “uncertainty prevails about the direction that could be taken by the next government.”
“To maintain our position as a regional leader, for this we must invest in infrastructure such as roads, rail and ports, among other things,” Luciano Fernandes
Fernandes did not miss the opportunity to point out that “the weak point”, identified in advance by the maritime strategy, is the lack of qualified personnel in the maritime and logistics industry. “Although there are many initiatives, both public and private, we are not seeing the results needed to support sustainable growth in the sector,” he said.
The CMP has been pointing out for several years this serious limitation of human capital. In April, 2014, during a forum on human capital for the development of the maritime and logistics industry, the CMP introduced a pilot technical training plan, prepared by the consultant René Quevedo. The study revealed a growing deficit over the next decade unless corrective action is taken.
Fernandes said there is a need to boost technical training, but stressed the importance of developing soft skills. These include commitment, leadership, ethical and moral values, among others. “We want to urge all parties to join efforts and, in addition to technical training, include the development of soft skills in the training of human resources required in the sector,” he said.