Source: International Living
U.S. President Barack Obama recently put the final signature on what some are calling the last major trade agreements of his administration.
With a simple signing ceremony, Obama made Panama—along with South Korea and Colombia—one of only 20 countries in the world to have a Free Trade Agreement (FTA) with the U.S.
The Associated Press reports that the agreement “could be worth billions to American exporters and create tens of thousands of jobs.” For Panama, the implications are just as far-reaching—for big business and small business alike. Looking to start an import-export business? If you plan on trading between Panama and the U.S., the situation is looking more favorable than ever. Considering the fact that Panama is one of the region’s highest ranked import-export markets, that is saying something.
And in a country that already boasts astonishing variety—from choice of restaurants and entertainment to the selection in shops, supermarkets, and more—the influx of new products will only make the panorama more exciting.
Competition may also drive prices down and boost everything from customer service quality to the already thriving job market. (Unemployment is already lower here than in the U.S. at just 5.6%). Needless to say, the expat community here is also likely to swell as foreign investment in Panama gets kicked up yet another notch.
Good News For Panama
Serious talks for the Free Trade Agreement began in 2004. Three years later, in 2007, U.S. and Panamanian trade representatives announced that negotiations had concluded on a comprehensive FTA to eliminate key barriers and expand trade between the two countries. Supporters of the pact in both countries hoped for speedy ratification.
Panamanians were already envisioning economic growth and increases in foreign investment. But these benefits would not come as soon as locals hoped. Year after year, Panama tried to resolve key issues presented as requirements for ratification by U.S. Congress.
After enacting labor reform and increasing fiscal transparency, Panama was proclaimed by U.S. trade representatives to have satisfied every major concern. Earlier this month, U.S. congressional passage of the agreement began generating headlines. Finally, the end was in sight, and Obama’s signature was the only thing needed to seal the deal.
U.S. companies like mega-manufacturer Caterpillar—which already has operations in Panama—were quick to praise the FTA. Manufacturing wasn’t the only industry to rejoice—agricultural concerns have been lobbying for the FTAs in a big way.
In Panama, President Ricardo Martinelli announced he had received a call from Obama. He gave Martinelli “the good news” and reportedly commended Panama for its democracy and transparency. The FTA gives Panama greater access to the U.S. market (some 300 million consumers), provided Panama enacts a series of changes to legislation concerning customs, immigration and insurance, among other things.
While there is still a great deal of work to be done, one thing’s for sure: everyone involved in promoting the FTA—both in the U.S. and Panama—has achieved a major milestone.