Panamanian Statistics Give Hope For Future

by Mike Godfrey, Tax-News.com, New York

29 May 2001

Despite political and economic difficulties which followed the return of Panama's sovereignty by America last year, and pressure from the FATF and OECD, Panama may be weathering the storm. Recent statistics on canal traffic and free-zone exports are both encouraging.

Panamax vessel traffic rose to 2,687 transits in the first seven months of fiscal year 2001 (October 2000 to April 2001), representing 36.2% of total ocean-going transits. Cargo tonnage rose to 116.1 million long tons, a 2.6% increase over the 113.1 million long tons during the same period in fiscal year 2000. Major commodities contributing to the increase included petroleum products and containerized cargo, as well as grains, ores and metals, refrigerated foods, fertilizers and machinery and equipment.

Re-exports from Panama's Colon Free Zone (CFZ) reached $1.647 billion in the four months to April, up 2.7 percent on the same period last year. Imports at the CFZ, which comprises around 1,890 businesses in a 1,000-acre (400-hectare) site near the Caribbean entrance to the Panama Canal, slipped to $1.42 billion in the four-month period, down 0.6 percent on last year. The CFZ administration, which regulates trading and collates statistics at the duty-free trade park, said re-export figures for the month of April grew 14.1 percent over the year ago period, to $382 million, while imports rose 7.4 percent to $393 million.

The Panama Canal Authority's budget for the fiscal year 2002 (October 2001-September 2002) contemplates increases in traffic and cargo tonnage. The new budget expects 14,868 transits in FY2002, of which 13,143 will be ocean-going vessels, approximately 1.1% above the current budget. Cargo tonnage is expected to reach 237.2Mt. The 2002 budget predicts Panama's national treasury will collect US$226.8mn in direct tolls from the canal, up US$28.6mn on FY2001.

The canal is expected to generate US$795.4mn in total revenues from operations during the next fiscal year. Panama Canal Administrator Alberto Aleman also reported that the Culebra Cut widening project remains on track and is scheduled for completion by December this year.

Foreign firms continue to invest in the country's many free zones, as well. US electronics major Nextel Partners Inc. is building a 65,000-square-foot customer support facility at Beckrich Office Park in Panama City. Expected to be complete by the first quarter of 2002, the center could hire as many as 600 employees. Nextel provides digital wireless communications services.

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