2013 is a special year in Panama. It marks 500 years since the Spanish explorer, Vasco Nuñez de Balboa, became the first European to lead an expedition to reach the South Sea, later known as the Pacific Ocean. This happened on Panamanian land in 1513. So we are celebrating this momentous event, one that the Europeans called the DISCOVERY OF THE PACIFIC OCEAN, while Panamanians named it AVISTAMIENTO DEL MAR DEL SUR – ‘Sighting of the South Sea.’ But whatever you choose to call this outstanding event, Panama’s economic, political and cultural destiny has been historically attached to our mission of uniting both seas. This fact will be re-emphasised shortly, with the completion of a renovated and expanded Panama Canal.
From visionary investors building the first transcontinental railroad in the nineteenth century to today’s well-established UK-based global firms, Panama has always been a magnet for British investors. In these times of economic turmoil, Panama and the UK seek to further strengthen their economic ties in order to contribute to each other’s prosperity. Furthermore, this relationship is bound to reach new heights after the EU-Central America Association Agreement ratified last March, the signing of a Double Taxation agreement last July, and Panama’s steady progress towards accession to the Organisation for Economic Cooperation and Development, as well as to the Pacific Alliance.
Future British investors should note that Panama’s economy is booming, with a GDP per capita that has increased from US$13,200 in 2010 to US$15,300 in 2012. Accordingly, Panama developed an increasingly sophisticated middle class with quite an appetite for British products and services. In fact, FCO statistics reveal that Panama currently buys approximately 60 per cent of all UK exports to Central America. Worth around £169 million, these are beverages, medicines, chemicals, heavy machinery and road vehicles. For this and many other reasons, Panama is Britain’s best business partner in the middle of the Americas, ranking seventh in Latin America as an importer of British products and services.
According to our National Statistics and Census Institute, Panama’s GDP grew at a healthy 7 per cent during the first quarter of 2013, and its unemployment rate is still at an all-time low (4.5 per cent). This is due to several well-known factors: the Panama Canal Expansion Project, Panama City’s new underground system, new roads and hundreds of residential construction works, among many other projects.
Yet despite its prosperity, Panama is still a work in progress. We are seeking in earnest to develop our full potential in order to lift more Panamanians out of poverty. This, of course, gives our British business partners a full range of development opportunities to consider. Panama is currently seeking investors to develop its transport infrastructure and logistics, financial services, tourism, agro-export and technological sectors. There are also plenty of unexploited opportunities in renewable energies, education, and the industrial sector that are worth exploring.
In order to help businesses tap into these opportunities, Panama has worked hard to create the kind of environment that will allow companies to take full advantage of our country’s strategic position, providing a way into the Latin American Market. The first of these measures was 2007’s Bill 41 – amended through 2012’s Bill 45 – which created a special regime to establish Regional Headquarters of Multinational Enterprises, and 2011’s Bill 32, that created a special regime to establish and operate free-trade zones.
In order to develop Panama’s full potential, there are some particular areas of interest that we think the UK could become an important partner in. The first sector is education. The UK has several academic institutions that are ranked highly in global higher education league tables. We also admire the richness of British education and are looking forward to raising educational standards in Panama and establishing further schools such as King’s School, not only in Panama City but in other towns as well.
But no matter what you choose to call these outstanding events today, Panama’s economic, political and cultural destiny has always been historically attached to our mission of uniting both seas through the Panama Canal – the current expansion of which is due to be completed in 2015.