us/panama business council- why panama
TRANSCRIPT
Panama: It’s Happening now!US Panama Business Council
ECONOMIC SITUATION
Solid Economic Growth2006-2008
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
El Salvador Colombia Panamá Costa Rica Guatemala Rep. Dominicana
Chile México
4.2%
6.9%
8,7%8.8%
5.4%
10.7%
4.6%5.1%
4.7%
7.5%
12,1%
7.8%
6.3%
8.5%
4.7%
3.3%
2.5% 2.5%
10.7%
2.6%
4.0%
5.3%
3.2%
1.3%
2006
2007
2008
Panamá has shown the best performance among
emerging markets in the region.
Source: www.eclac.org
Infographics: National Investment Promotion Division
GDP Growth compared to other countries in the Region
Continuous Economic Growth2009
During 2009 the world faced a financial crisis which reduced the world´s trade,
but Panama got over it, and became one of the few countries in the region that
has reported an economic growth of more than 2%..
Source: www.eclac.org
Graphics: Dirección Nacional de Promoción de la Inversión
Construction
2003 2004 2005 2006 2007 2008 2009
883.4 473.8 931.0 1,007.5 1,302.9 1,601.3(p) 1,548.8(p)
*Million dollars(p) Preliminary figures
Construction industry represents approximately 5.8% of the GDP
Source: Contraloría General de la República
2010 4.5% ECLAC Estimated Growth
The Economic Commission for Latin America and the Caribbean has estimated an
average of 4.1% growth rate for the region.
Panamá is above the average growth rate.
Investment Grade
Lower cost of financing
Higher degree of confidence in our banking system
Ideal environment for generation of jobs
Benefits
Panamá only country in Central America
BBB- Fitch Ratings
Source:Diario La Prensa. March 24, 2010.
Infography: La Prensa
Foreign Direct Investment
2004 2005 2006 2007 2008 2009e
1.019,1 962,1
2.574,2
1.825,1
2.401,7
1.772,8
Source: Contraloría General de la República de Panamá
In the past 6 years, Panama has established itself among the leaders of the region, boosting sectors such as Information Technology and Communications, Energy, Tourism, Real Estate, Multimodal Transport and Logistics Center, Construction Sector, banking, among others.
BUSINESS ENVIRONMENT
Easy of Doing Business
2009 2010
Chile 42 Colombia 37
Colombia 53 Chile 49
El Salvador 72 Panamá 77
Panamá 83 El Salvador 84
Rep. Dominicana 86 Rep. Dominicana 102
Guatemala 110 Guatemala 112
Costa Rica 121 Costa Rica 117
Source: The World Bank. Doing Business Report 2010.
Multi-modal and Logistics
PLATFORM
GATUN
LAKE
ATLANTIC
PACIFIC
Logistics Platform for the World
Panama Canal
Railroad/ Fiber optic cable
Transithmic Highway
Panamerican Highway
Ports
Airports
Tocumen InternaTional
Airport
Manzanillo Colon Container
Cristóbal
Airdrome Enrique A. Jiménez
Marcos A. Gelabert
Balboa
PSAHoward
Privileged Geographic Position
Panama offers direct access to a market of more than 3.5 billion people.
Source: NAFTA, APEC, MCCA, CAN, CARICOM, EU.
Panama Canalwww.pancanal.com
T
Movement of cargo of 298
MT/ year
Access to 144 maritime
routes in 80 countries
In 2009, +14,000 ships
transit the waterway
Source: http://www.pancanal.com/esp/maritime/statisti.html
Panama Ports Company -Cristobal
Panama Ports Company - Balboa
Manzanillo International Terminal
Panama Canal Expansion Project
• Estimated investment of $5,250 Millions
Investment
T
Land
Railway
75.5 Kilometers (47 mile) Single-
line track linking Balboa
and Colon
Two-way traffic at strategic locations.
Roads Network
3 main roads that connect
all major regions of
the country
Panamerican
Transistmica
Central
2 highways in Panama City and a
new connecting
to Colón
K
Substantial investment in road infrastructure
Source: Government Strategic Plan 2010-2014. Gaceta Oficial Nº 26445-A Pag. 48. http://www.gacetaoficial.gob.pa/pdfTemp/26445_A/GacetaNo_26445a_20100112.pdf
K
Key investments in added value to logistics services:
A. Finish the Panama Colon stretch.
B. Rebuild the road infrastructure in the Colon Free Zone
C. Connect Howard with the Centennial Bridge
D. Finish the North highwayE. Connect Tocumen with the
cargo terminal.
Road to finish
Panama is closer to the WorldTocumen International Airport
2009
HUB of the Américas
Operational Airport CapacityNow
• 32 Boarding Positions
• 32 Simultaneous Operations(Passengers)
• 11 Simultaneous Operations (Load)
• 5 Millions Passengers/Annually
• Track length of 3,050 mts
Future
• 66 Boarding Positions
• 70 Simultaneous Operations(Passengers)
• 20 Simultaneous Operations (Load)
• 30 Millions Passengers/Annually
• Track length of 4,000 mts
Source: Tocumen International Airport Presentation
BOCAS DEL TORO
Expansion of the Airports Network
DAVID
PROVINCIAS
CENTRALES
COLÓN
Source: Aeronautic Authority
Great Connectivity for Telecommunications
Panama is connected to the world through 5 fiber optic submarine cables
The United NationsConference on Tradeand Development(UNCTAD) rankedPanamá as the countrywith best connectivity inLatin America.
Source: Transport & Cargo Magazine. Written by JAN.HOFFMANN Chief Trade Facilitation (UNCTAD)
Financial SectorBanking Systemwww.superbancos.gob.pa
• No central bank
• 90 national and international banks
• Total assets US$ 64,209 million (Jan. 2010)
• U.S Dollar base economy
Insurance & Reinsurance www.superseguros.gob.pa
• By February 2010, the premiums totalizedmore than $ 139 million, 8.34% over than thesame period in 2009.
INVESTMENT PROMOTION LAWS
• Tax exemption on income, social insurance and educational insurance, when their salaries come from abroad (parent).
• Import Tariff Exemption for household goods when a worker moves for the first time to Panama.
Tax incentives for foreign workers are:
• Permanent Personnel – 5 years (Renewable) Indefinitely
• Temporal Personnel –3 months (Renewable) 1 Time
Immigration Benefits
Creates the Special Regime for Establishment and Operation of the Multinational
Company Regional Headquarters
Colon Free Zone
Decree-Law 18 of June 17th of 1948, by which the Colon Free Zone was created as an autonomous entity of the State.
680 hectares, divided into two (2) commercial areas:
• the commercial area of showrooms in Colon (old city limits) and,
• commercial warehouse and storage area in France Field.
250,000 visitors come every year from all over the world.
Is the largest free zone in the Western Hemisphere, being the major trading center for Latin America and the Caribbean.
Fiscal Benefits
• 0% Taxes on profits from re-exports.
• 0% Customs duties in import and export quotas.
• 0% Billing taxes.
• Highly competitive costs.
• Migratory facilities for foreign executives.
Importers Advantages
• Purchase in one place only.
• Excellent assortment of products.
• Credit facilities.
• Clearance in less than 24 hours.
Exporters Advantages
• From Colon, Rep. of Panama, located in the center of the Americas, you will have access to: - Western Hemisphere -Europe -Asia -Africa - Australia
Benefits and advantages of operating in the Colon Free Zone
Panama-Pacific
1,400 hectare Special
Economic Zone adjacent to the Canal, Railway,
Ports and Panamá City.
Taxation, customs, labor,
immigration and special business
Regime
London & Regional
Panama as master
developer of the project.
Business and Commercial world class center with
residential areas of high level
Target activities will be exempt from taxes in
the Republic of Panama
www.aaeepp.gob.pa
Law No. 41 of July 2004.
Target Activities
Multimodal and Logistics Services
Transfer of Services to the Aviation Industry
Maintenance, Repair and Overhauling of
Aircrafts
High Tech Product Manufacturing
Call Centers Office Administration Back Office Operations Data Transmission, Radio, TV, Audio and
Video
Off shore Services Stock Transfer Between Onsite Companies
Transfer of Goods and Services in the area.
Synergy
Education
InvestigationInnovation
City of Knowledge
Operates as a local node of the global network of
knowledge management, and contributes to human
development.
Panama’s International TechnoparkPanamá Business Accelerator
Established as a strategic focal point for regional operations of international organizations
City of Knowledge Benefits
FiscalExemption from all taxes,
contributions, tax or import duty on machinery, equipment,
furniture, vehicles, appliances and supplies needed
FiscalTransfer Tax Exemption of
movable tangible property and services (ITBMS) on machinery,
equipment, vehicles, implements and inputs necessary
FiscalExemption from any tax, fee or charge levied sending money
abroad, where such remittance or transfer of funds takes place for
the purpose of the project.
ImmigrationThe State shall grant special visas to foreign personnel who enter
the country to help in the development project of the City
of Knowledge.
LaborThe companies affiliated with the City of Knowledge are authorized
to hire international staff as necessary to carry out their duties
EXPORT PROCESSING ZONES
• EPZ are Duty Free Zones of Free Enterprise,specifically delimited, whose activities arethe production of goods and services forexport.
• Categories:
– Manufacture enterprise
– Assembly
– Processing enterprises of finished orsemi-elaborated goods
– Service export enterprise
– General services enterprises.
Incentives
– Exemption from export taxes and duties on all goods or services required for its operations.
– Tax on capital assets or property exemption
– Income tax exemption for warehousing services who have their desired effect abroad
– Permanent Resident Permit as an investor
– Temporary Resident Permit
Tourism
• Exemption of Import and Land Tax for 20 years
• Exoneration of tax on capital gain.
• Exemption from payment of taxes of docking and landing at docks, airports or heliports owned by the company
• Exemption from Income Tax
• Rate of 10%, for the purposes of calculating the depreciation on real estate.
Fiscal Incentives
National Tourism RegistryMinimum Investment:
$ 3,000,000.00 - Metropolitan Area$ 50,000.00 - Rest of the Republic
Source: Law Nº 58 2006. G.O.25,701
Cabinet Decree No. 36 dated 17 September 2003, regulates the activity of oil-free zones in Panama within these areas there is a special treatment
Import, export, refine, process, recycle, mix, distribute, transport and market petroleum products authorized.
Tax Regime: Free Zone, will not cause any tax, fee, levies and other fiscal contributions reasons for introduction, or re-export of crude oil and its derivatives
Fuel Free Zone
Mining
We promote the mining industry development as a substantial element in the social -economic and industrial
development of our country.
It is the main activity in terms of its foreign exchange contribution to the
national economy.
Transparent Sustainability InnovationSocial and Environmental
Responsibility
Source: National Direction of Minerals Recourses.
Investment Legal Stability
Guaranteed beneffits for 10 years:
• Legal stability
• Tax stability
• Tax stability in the municipal order
• Stability of the customs that are derived from the Laws
• Stability in the labor regimeRequirements for Investors:
• Investment Plan at least twomillion (B/.2, 000.000.00) intwo years.
• Prove the amount ofinvestment and activity
Law No. 54 -1998
PROJECTS
Agro - Export
•Absence of extreme summers
•Higher concentrations ofsweetness in fruit
•High quality of natural water
•Coffee SHG (Geisha)• Melon
• Watermelon • Pineapple
Public Investment by Sector
Panama City Metro
• Currently representatives of companies fromItaly, Spain, France, Japan, Brazil, China,Colombia, Germany, Mexico, like Panama, hasshown interest in participating in this project.
• The Swiss-Mexican-Panamanian consortiumPÖYRY Cal & Mayor & Geoconsult won the bidto be the integrator advisor of the project.
• For the prequalification statement visit thewebsite www.panamacompra.gob.pa.
Investment: U.S.$ 1,000 - U.S. $1,500 millionsExtension: 14 kmTravel Time: 30 minutes.
Source: http://www.presidencia.gob.pa/ver_nodo.php?cod=886
http://www.prensa.com/t.asp?d=100107p2054148
New Convention Center
Aprox. Cost: 150 millions
Will allow Panamá to take advantage of thegeographic position, holding all types ofmega events .
Will oversize our current convetion center
Source: Government Strategic Plan 2010-2014. Gaceta Oficial Nº 26445-A Pag. 76
Governmental City and Financial Tower
Physical centralization of key government institutions.
Area: 64 HectaresCost: $ 450 million.
Source: Government Strategic Plan 2010-2014. Gaceta Oficial Nº 26445-A Pag. 75- 76
70 levels100,000 m² of construction
PanamaComprawww.panamacompra.gob.pa
Objectives
• Increase transparency in government procurement
• Efficiency
• Intensify the fight against corruption
Informs
• Products and services that are required by the Panamanian public sector
Allows
• Get information about business opportunities
• Consult the time that it will make payments to suppliers
• Receive notifications to be affiliated.
Agency for Investment Attraction and Export Promotion
LOGISTICS AGROEXPORTSTOURISM FINANCIAL SERVICES
ONE STOP SHOP
SEM
Panamá Pacifico
Ciudad del Saber
Panamá Film
Commision
www.mici.gob.pa