CANAL GETS BUDGET
President Ricardo Martinelli passed Law 69 of September 6, 2011, approving the budget of the Panama Canal for the fiscal year from October 1, 2011 to September 30, 2012. The budget amounts to $2,398.9 million. With this budget the Canal will provide a total of $950.7 million to the State, a record as the highest so far was made from the budget of 2010-2011, which it was $839 million. The budget shows an increase in toll revenues as a result of a projected increase in traffic of vessels and the annualized effect of rates adopted on June 15, 2010, and implemented in January this year.
TALKS ON CANAL FUND
The creation of a sovereign fund with part of the additional income that the Panama Canal expects once it is expanded will help to reduce the public debt. This is one of the intended uses for the resources that are managed by the fund, whose structure is at an early stage of analysis and debate.
CATERPILLAR AGENT SALE
The Panamanian company Cardoze & Lindo, a distributor of the Caterpillar brand of heavy equipment, is negotiating the sale of its assets with the Ecuadorian company Importer Industrial Agricola SA (IIASA). Cardoze & Lindo, with over 90 years in the Panamanian market, is the leading supplier of heavy equipment to the construction sector.
JUST BY A THREAD
Panama’s textile industry is having a hard time because “it is in intensive care and dying.” When in the 80’s there were exports of $20.6 million, they are now just exceeding one million dollars in annual shipments abroad.
POSITIVE ON INVESTMENT
The Ministry of Commerce and Industry predicted that foreign direct investment (FDI) could be close to $3 billion at the end of the year, a figure higher than in 2010, when the FDI was $2,362 million. The Ministry also announced that it has confirmed the arrival of two new companies (unnamed) to Panama under the law of Multinational Corporations. Thus, the number of firms that have benefited from this scheme would be 60.
CANAL AREA SALES
During the first six months of 2011, the Administrative Unit of Reverted Property (UABR) raised $8.5 million for the Ministry of Economy and Finance. Of the total, $4 million was from property sales and commercial leases.
Panama is in an economic boom and has a thriving international financial center with 93 banks, 66 securities firms and 33 insurance companies operating, but it is still vulnerable to illicit activities. Given the changing patterns of money laundering and because new activities constantly permeate the economic sphere, local authorities are working on a proposed amendment to Law 42 of 2000 on prevention of money laundering and combating the financing of terrorism.
The amount of imported goods entering the country rose 21.5% during the first half over the same period of 2010. Various goods were imported to the tune of $5,384 million from January to July 2011, shown in figures from the Comptroller’s Office. Of all the products, “capital goods” were the most imports for an increase of 31%.
Panamanian exports are projected to show growth of approximately 20% at the end of the current period, according to a study by the Economic Commission for Latin America (CEPAL). The document also makes it clear that imports to the country also adopted a bullish trend estimated at 28%.
NEW SHARE RULES
Brokerage houses operating in Panama must be free of liens and maintain at all times a minimum total capital of $250,000, as established by a new standard issued by the National Securities Commission (CNV). The deadline for submission of the report of this requirement to the CNV is November 2011. The new regulation, Law 67 of September 1, 2011, was published in the Official Gazette No. 26 863-A of September 2, 2011. This is a period of two months for the transition of the National Securities Superintendence. The government is seeking a person familiar with the market to be the Superintendent, but sources agreed that it is a competitive market, and it will be difficult for a young professional to leave his private practice to accept the position.
The Panamanian insurance and reinsurance market is solid and attractive and is expected to close 2011 with $1,000 million in premiums, it is reflected in official reports of the Ministry of Commerce and Industry (MICI).
Stimulating the innovative capacity of students in government schools at national level is the goal of the Future Innovators Award, which was released by the National Competitiveness Center, the Ministry of Education and the National Secretariat for Science, Technology and Innovation (Senacyt).