Grupo ASSA: Financial services

The Company Grupo ASSA is a holding company listed on the Panama Stock Exchange (Bolsa de Valores de Panamá, BVP) under the ticker symbol ASSA. The group has operations across Central America in three main sectors: banking and financing activities, insurance and reinsurance, and other strategic investments, which account for 45.9%, 42.1% and 11.1% of the group’s revenues, respectively. The company’s subsidiaries are among the leaders in their respective industries. ASSA Compañía de Seguros (Panama), for example, is the number two insurance company in the country, and received an “A” (excellent) financial strength rating and an “a” issuer credit rating from A.M. Best, which the

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Grupo Melo: Agribusiness

The Company Grupo Melo is an industry leader in a variety of agro-industrial activities across Panama, with a historical focus on poultry products. The company is publicly traded, listed on the Panama Stock Exchange (Bolsa de Valores de Panamá, BVP) under the ticker symbol MELO. Grupo Melo has expanded to have a national presence through its 196 points of sale, operating through an internal structure made up of eight separate divisions. The company’s portfolio includes restaurants, pet services, gardening, industrial equipment sales and construction material outlets. Together, these eight divisions generated roughly $424.8m in group sales for FY 2014, for a 6.3% increase over the

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Panama Power Holdings: Renewable energy

The Company Panama Power Holdings is a holding company that is traded on the Panama Stock Exchange (Bolsa de Valores de Panamá, BVP) under ticker symbol PPHO. Through its subsidiaries, the company operates and develops renewable energy generation projects. Its primary focus is run-of-the-river hydroelectric power stations. Panama Power Holdings operates four hydroelectric power plants; Hydro Caisán, with 72 MW installed capacity; Generadora Pedregalito, with 20 MW; Generadora Alto Valle, with 15.7 MW; and Generadora Rio Chico, with 12.5 MW. The company also owns 65% of Inversiones La Manguera, a hydroelectric power plant located in Costa Rica. Growth Strategy In addition to its established hydroelectric

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Rey Holdings: Retail

The Company Rey Holdings is a publicly traded holding company, listed on the Panama Stock Exchange (Bolsa de Valores de Panamá, BVP) under the ticker symbol REYH. The company owns 100% of Empresas Rey, which in turn owns 100% of Immobiliaria Don Antonio, Agroindustrial Rey and Setrey. Although the company was officially founded in 2000, it can trace its origins as far back as 1911. Together, these companies own and operate three different supermarket chains throughout the country, including Supermercados Rey, with 24 branches; Supermercados Romero, with 10 locations; and Supermercados Mr. Precio, which has 10 branches. In addition, the group owns and operates two

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George Richani-CEO-Al Ahli Bank of Kuwait

In search of profits: Profitability has taken a hit due to soaring claims costs

In terms of premiums, the country’s insurance sector has been growing consistently since 2009. However, by some measures, profitability has been falling. According to Panama’s insurance trade association, Asociación Panameña de Aseguradores (APADEA), technical profits (i.e., the earnings from underwriting of risks) totalled $13.5m in 2013, while in the first nine months of 2014 they were $8.4m. Given the rise in gross written premiums, the technical margin (technical profits as a percentage of gross written premiums) dropped from a peak of 3.5% in 2010 to 1.6% in the first three quarters of 2014. Put another way, the combined ratio is 98.4%. A Jump in Claims

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Daniel Asare-Kyei-CEO-Esoko; Curtis Vanderpuije-CEO-ExpressPay; and Daniel Marfo-General Manager-Zipline Ghana

Ambitious plans: Public investment is focusing on logistics, mass transport and highways

Panama has a long history of transport and logistics infrastructure investment, with one of the most significant certainly being the widening of the Panama Canal. With an initial budget of $5.25bn, recurrent costs have raised the cost of the project to more than $6bn. Some estimate the grand total may reach $7bn, over 30% more than originally planned. Cost overrun claims from contractors reached $463m in compensation from which $233m were approved (related to concrete and basalt), and $130m in 2014, which were not accepted. The possible overruns have experts concerned that expenditure may be deviated from other works towards the completion of this vast

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Nhon Luc Ly-CEO-AIA Myanmar; Son Nguyen-Country President-Chubb Life Insurance Myanmar; Daw Zarchi Tin-CEO

Competitive edge: Preparing for increased competition with new projects

With access to both the Atlantic and Pacific Oceans within a few kilometres of each other, Panama is one of the best-located countries for maritime activities globally. Added to its location, the Panama Canal and its expansion make it a key player in world commerce. The current container-handling capacity for the Pacific side of Panama is estimated at 5m twenty-foot equivalent units (TEUs). Canal expansion-related projects are expected to boost capacity up to 6m TEUs by 2016 and 8m TEUs by 2020. Still, competition in the region is fierce and infrastructure expansion is key to maintaining regional leadership. According to Philippe Fiore, CEO of Pier17

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Nhon Luc Ly-CEO-AIA Myanmar; Son Nguyen-Country President-Chubb Life Insurance Myanmar; Daw Zarchi Tin-CEO

Mixed modes: Expanding cargo capacity for intermodal transport

Although historically the Panama Canal has been the top revenue earner, the contribution of canal revenues as a percentage in the transport and logistics sector has been gradually declining. In 2008 income from the canal represented 46.6% of sector GDP, while in 2013 it amounted to 37%. This shows that other transport modalities, mainly land-based cargo, have increased in size. Most of this success comes from the sector’s expanded capacity for intermodal transport options. The most important intermodal transport modes have been maritime-land-maritime, using the railroad, and via truck using the highway. Rail & Road The term trans-shipment refers to the cargo that is unloaded

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Éric N’guessan-Managing Partner-EY Côte d’Ivoire

The finer things: Location and favourable conditions make the country an attractive luxury retail destination

The combination of Panamanians’ growing purchasing power and the presence of foreigner visitors eager to spend in upscale boutiques has contributed to the latest boom in the luxury retail sector. The tangible impact of this growth can be seen in the influx of international high-end brands and ongoing investments in the construction of luxury retail space. Looking Up The prosperity of Panamanian customers has encouraged upscale brands such as Burberry, Louis Vuitton, Gucci, Fendi and Hermès to enter the local market. Sector research prepared by

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Emmanuel Macron-President of France

Bureaucracy backlog: Why the number of building permit requests has fallen

As one of the main challenges in Panama’s construction sector despite the rapid growth of recent years, many developers point to the process of issuing building permits, which has been fraught with delays and rising prices. Permit costs have risen significantly in some municipalities, such as San Miguelito, which raised them by 40% in 2015. The reasons given for such adjustments were that the price of construction materials has risen, and that fees had not been raised in over a decade. According to data from Panama’s comptroller general, from 2014 to 2015 construction material prices rose by 6% for wood and sand, by 4.6% for

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