Interview: José Pacheco Tejeira
How is Panama working to encourage and facilitate increased foreign investment?
JOSE PACHECO TEJEIRA: Proinvex is focused on attracting more European and Asian investors, and we are also developing the opportunities being created by new free trade agreements (FTAs). Encouraging the establishment by multinationals in Panama is also a very big a part of our strategy. Currently there are 105 multinational firms with regional headquarters in Panama.
In what sectors will the recent raft of FTAs have the most impact and provide new opportunities?
PACHECO: When the expansion of the canal is complete, the quantity of goods crossing the waterway is expected to be three times the current total. Together with all these new FTAs, we can see good opportunities in developing industrial areas, along with the free zones, in activities that add value to specific products. Currently most of these products are simply crossing Panama through the canal. However, some pharmaceuticals companies have started to take advantage of our geographical location and the various incentives our laws offer in order to use Panama as a place to finish or package their products before redistributing them throughout the region.
Where do you anticipate the most growth in terms of exports and re-exports?
PACHECO: Historically, Panama has played an immense role in the world’s logistics operations. We have been in this business for more than 500 years – since the overland route to the Pacific Ocean was discovered by Vasco Núñez de Balboa in the 16th century. This country has long focused on improving its multimodal logistics complex, especially with the inauguration of the Panama Canal 100 years ago. Currently, 144 maritime routes depart from Panamanian ports every week. With re-exports, as I explained before, pharmaceutical products will experience growth, along with electronics. The government has been closely working with industrial associations to develop a policy and promote it. One aspect is clear: industries coming to Panama cannot think only in terms of our domestic market of 3m people. Our main advantage for producers is our logistic platform. An industry based in Panama can distribute its products to Central America and Caribbean countries more easily than from any other place, not only because of our facilities and the number of ships using our ports – more than 14,000 per year – but due to our numerous FTAs. ICT companies will also offer firms a wider variety of export services. More companies could be attracted to Panama due to the five submarine communications optical fibre cables crossing the isthmus. A sixth one will be crossing Panama soon as well, originating in Ecuador and stretching to Florida in the US. Some recovery data companies have also established their regional headquarters in Panama, and new ones are expected to be arriving soon.
What efforts are under way to ensure that foreign investors have access to a skilled workforce?
PACHECO: In the short term we have been looking for solutions such as simplifying the application process for visas through the Friendly Nations Visa programme. Several visas for specialist employees have been issued too, allowing companies to concentrate their experts in their headquarters in Panama. The government has also allowed the spouses of expatriate workers to obtain employment in Panama. In fact, we have created a website, together with the International Chamber of Commerce and different multinationals, to offer a useful resource for these workers.
For the long term, we have been working hard to improve the education system. As far as our own actions are concerned, the Vice-Ministry of Foreign Trade has attracted top-quality education institutions to the country. We have also encouraged private schools to set up campuses here in order to make Panama more enticing for top executives. It is important that they have access to good quality schools for their children.
Read More from OBG
