Posted on 2017-06-13
12 June, Panama announced a change in its commercial and diplomatic strategy to sign an agreement to establish diplomatic relations with China popular and break with Taiwan. Mainland China is the fourth largest trading partner of Panamanian exports in 2015, representing 5.9% of the total FOB value, is also the number two Panama Canal user.To this is added that the Asian country is China the third trade partner of imports making the national economy of Panama (excluding ZLC), which represents 9.5% of total imports from the world.
As with the rest of the countries, Panama has a trade deficit with China. The latest available figures in her Ministry of Commerce and industry of Panama, date from the first half of 2016, these indicate that Panama exported $17 million, against an import of $467 million on the same date.The main imported products include bars and deformed bars (corrugated), to reinforce concrete, steel or iron. Mobile phones (cell phones), and other wireless networks.
In addition are the tyres (pneumatic tires), new rubber, of a kind used on motor cars (including the family type ("break" or "station wagons"), and career), also photosensitive semiconductor devices, including photovoltaic cells but they are assembled into modules or panels; light-emitting diodes.
While the main products exported to China from Panama are flour, powder and "pellet" of fish, waste and scrap of copper. Wood sawn or etched lengthwise, sliced or peeled, even brushed, sanded or United jointed, of a thickness exceeding 6 mm. Waste and scrap of aluminium. Wood in the rough, even debarked, desalburadas or squared.
The list continues with hides and skins tanned or "crust" of bovine (including Buffalo) or equine animals, without, in the wet state (including the "Wet blue"), except in full bloom without dividing; split with flower.
See table: trade balance
In terms of new investment, growth in the interest of Chinese enterprises in establishing in Panama and make investments in Panama is undeniable, the most recent was a few days ago when the company China Landbridge Group began construction of "Panama Colon Container Port" (PCCP) located on Margarita Island, province of Colon. The first phase of the project consists of the construction of the docks and the container yard, in addition to the works of dredging and filling. This work includes an investment of around US $1,100 million. But this same company is also currently the main shareholder in Westside Corporation, Ltd. producer of natural gas with important reserves in Australia. The company in Panama is also investing in a natural Gas plant, between the two projects, the investment will be around US$ 1,800 million.
Little less than three years ago, in October 2015, the Huawei company, established its distribution center in Panama, this Chinese technology company projected at that time a supply of equipment equivalent to US$ 20 million for what remained of the year 2015 and $160 million by the year 2016, with an approximate 20% annual growth.
Another approach is the recent bidding for prequalification for construction of the third line of the Metro de Panama, held on May 2 of the nine companies that presented four proposals were capital and Chinese origin.
Chinese companies in Panama
In Colon free zone
China in the region
In November 2016, ECLAC released a report on investment foreign direct (FDI) from China in Latin America and the Caribbean, in which pointed out that this increased markedly in 2010, but has not had a growing tendency in later years. In that document, it was estimated that during the two decades prior to 2010 they arrived in the region around US$ 7,000 billion of FDI from China. In 2010 alone, the estimated flow of china's FDI doubled the figure accumulated until then, approaching the $14,000 million (equivalent to 11% of the total FDI received by the region in that year).
"Three quarters of the total of china's FDI in the region in 2010 were two large acquisitions in the oil industry, by Sinopec in the Brazil and CNOOC in the Argentina. However, many other Chinese companies in different sectors came to the region or significantly increased its presence in 2010. In subsequent years, has followed arriving Chinese FDI to the region, but in minor, with a level estimated between 6,000 and 10,000 million dollars annually. These figures have represented between 3% and 8% of total flows of FDI received by the region"says the document.
Our Panama attorneys law firm offers a Guide to Doing Business in Panama completely FREE! Download here!Get it now