Isthmian Update August 28

More copper

The contract of Minera Panama with the Panamanian State has been in force since 1997 and expired on February 28. The Ministry of Commerce and Industries (MICI) granted an extension to Minera Panama for 20 years to extract copper from its mine in Donoso, Colón province. The resolution published in the Official Gazette was signed by the Minister of Commerce, Augusto Arosemena, and explained that the concession covers 12,956 hectares.

A joint effort

The Panama Canal is at the center of the relations between United States and Panama. At the Cocolí lock of the newly inaugurated Canal expansion, US Vice President, Mike Pence, representing Donald Trump, sent a message to Panamanians and to the neighboring nations of the hemisphere: “The prosperity of the United States depends on this pathway (the Canal),” he said. And shortly afterwards on the stairs of Panama’s presidential Palace of the Herons, he added: “we constructed the Canal together.”

FATCA compliance

The Revenue General Director, Publio Cortés reiterated to the financial institutions the importance of registering and reporting with the Foreign Tax Compliance Law (FATCA). Cortes recalled that Law 47 of 2016 approves the Intergovernmental Agreement (IGA) between Panama and the United States for FATCA and other applicable rules, making financial institutions register and report to the Department of Revenue of Panama (DGI).

Good investment

Last year Panama occupied sixth place in Latin America and the Caribbean for receiving the most Foreign Direct Investment (FDI), with a total of $5,209 million, according to a study by the Economic Commission for Latin America and the Caribbean (ECLAC). The report said that the largest component of FDI that entered Panama was the reinvestment of profits (66% of the total) and the amount remaining was at similar levels to those of 2015.

A new Canal

With an estimated investment of between $7 billion and $19 billion, depending on the model to be followed, there is a plan to build an Intermodal Transportation and Freight Transportation System (dry canal) between Chiriquí and Bocas del Toro. The project construction period has been divided into three stages of three to seven years and will employ a workforce of between 77,000 and 123,000.

Good grades

Moody’s maintains a stable outlook of Baa2 for Panama, the government said after reporting the presence in the country of a mission from that rating agency. The Panamanian Ministry of Economy and Finance (MEF) said in a public statement that officials of the ministry met with representatives of Moody’s, who are on their annual visit to the country.

No excuse

Former President Ricardo Martinelli has given no valid reason to the Miami Public Prosecutor’s Office to avoid his extradition to Panama and the prosecutor urged federal judge, Edwin Torres, to certify his removal to the State Department.

Integrated borders

Trade authorities, Customs directors and Central American computer technicians are analyzing the project of border integration in the region as of the agenda of a meeting in Panama. The meeting took place within the framework of the Pro Tempore Meeting of the Central American Integration System (SICA), for the second half of 2017, according to the National Customs Authority of Panama (ANA).

No vision

The academic level of Panamanians is affecting enterprise innovation, because students study to get a job and not to develop enterprising economies, according to specialists on the subject. A survey by the Global Entrepreneurship Index of 2016 reflects that Panama’s level of early entrepreneurship was 13.2%. That is, 13.2 of every 100 Panamanians of productive age are undertaking this avenue, placing it in the eighth place among the countries of Central and South America and it is surpassed by Ecuador, Colombia, Peru, Chile, Guatemala, Brazil, Argentina and Uruguay.

Costly material

Building homes and renovating or erecting non-residential buildings in Panama has become very expensive during the first seven months of 2017, according to official figures. The latest report from the National Statistics and Census Institute (INEC) of the Comptroller’s Office confirmed that the price of zinc plated iron roofing of 26 feet had a price increase of 19.4%; a foot of aluminum beam No. 4 also went up by 9.8%; the 30-foot ½ inch steel rod rose 4.1% and unfinished spruce wood increased by 1.0%.

Slow recovery

The recently appointed manager of the Colon Free Zone (ZLC) Manuel Grimaldo, expressed his interest in taking actions and coordinating efforts to increase the commercial movement in the free zone. Grimaldo’s words came during his first contact with the Users’ Association (AU) of this commercial emporium. Grimaldo is sure of the recovery of the ZLC, as the figures for the first half of 2017show that total commercial activity totaled $9,968.8 million, representing an increase of more than 5% over the same period of the previous year.

Unfair contract

‘A blatant robbery’ is how users describe the extension for two more years of the contract between First Transit Company with Mass Transport of Panamá, S.A. This agreement, which according to the government seeks to improve the mobility of passengers in the transport system in the Panama and San Miguelito districts, expired in September 2017, but was extended until December 2019 for an additional $10.3 million to the $11.2 million of the original contract.

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