Week in Review

SELLING FZ LAND

The bill to sell land in the Colon Free Zone has reached the National Assembly. The Minister of Economy and Finance, Frank De Lima said that there is much consensus with users of the free zone for the sale of these lands.The Minister of Commerce, Ricardo Quijano, formally presented the draft law to the Assembly that is already approved by Cabinet.

SHIPYARD TO OPEN

After the Balboa shipyard facilities being paralyzed for over a year, in November Marine Engineers Corporation, the Panama Mec Group, will take over after the signing of the concession contract for 20 years, renewable. Once they receive the keys, the new shipyard operator must pay $250,000 as the first monthly payment of the concession to the Panama Maritime Authority (AMP).

LOCK GATES COMING

After signing a $50 million contract with the steelmaker Cimolai, Geodis Wiutilizará, a freight company for heavy equipment, will mobilize the 16 lock gates to be used for the expansion of the Panama Canal. With the help of its team of engineers, Geodis Wiutilizará will use a unique tie system to secure the gates during transport. Four of the gates, weighing approximately 4,000 tons each, will be transferred by ship from Italy in February 2013 and three other vessels will continue shipping them.

COFFEE TRAVELS FAR

South Korea and Australia are positioned as the new markets for the commercialization of Panamanian Specialty Coffee, also coveted by European destinations, without the US losing its place as a main partner. For the period 2010-2011 the number of acres of coffee planted nationwide were between 19,500 and 20,000, according to the Ministry of Commerce and Industry (MCI), which said 46,000 quintals were exported in 2011.

PORT FOR MINE

The Panama Maritime Authority granted to Minera Panama SA just over eight hectares between shore and seabed in Punta Rincon, in the province of Colon. Resolution No. 130, published in the Official Gazette 27,132, allows the company to proceed with the construction of a port in the district of Donoso. From this port it will ship, from 2016, copper concentrate extracted by Minera Panama from the grant of 13,600 hectares in the same district.

UPWARD FORECAST

The growth forecast for Panama at the end of 2012 was revised upwards to 9.5% from the 8% made in June, according to the Economic Commission for Latin America and the Caribbean (ECLAC). An important part of this economic growth, as local analysts have warned, comes from accelerated public spending, and a financed structural deficit. ECLAC said in its economic survey of Latin America and the Caribbean that the region is confronted by strong and uncertain external economic pressures.

SHARE CONTROVERSY

Each year there are 40,000 companies in the country that generate, according to a study by the lawyer Eduardo Morgan Jr., revenues of approximately $300 million. Of this, $150 million is used to pay taxes and the rest is for the legal sector. Many lawyers are opposed to changing the system of Panama corporations. The banking sector looks forward to the Government modifying the use of corporations in order to consolidate operational structures crossing borders of the gray list of the Organization for Economic Cooperation and Development (OECD). The controversy is caused by the elimination of bearer shares. The other argument is that Panama is one of the territories that carry an international stigma of being a “tax haven”. This title is a result of poor quality, by not meeting in time with certain international standards on transparency in the handling of tax information and the companies created in the country. In an effort to shed this negative image, Panama has negotiated and signed information exchange agreements with other states and legal systems adapted to the needs of the Organization for Economic Cooperation and Development (OECD).

FIGHTING THE STRIP

The Front for the Defense of the Natural Heritage fought until the last stages to prevent the construction of the Coastal Strip III. The Environmental Advocacy Center (CIAM), one of the groups that integrate the front, announced that it will present a request for guarantee protection to try and stop the controversial road project. The Public Works Minister, Jaime Ford, denied that there is a conflict between Panama and Unesco.