You are here :: Panama Real Estate » Real-estate-investments » Free-trade-advocates

The Panama Free Trade treaty is before the US Senate and free trade advocates are pushing for its passage. Senators from agricultural states such as Chuck Grassey of Iowa are promoting the treaty. So are equipment manufacturers such as Caterpillar. If the US wants to improve its balance of payments then a little more free trade with the likes of Panama is in order.

There are a couple of misconceptions to clear up on free trade with Panama. First, if Panama starts some light assembly operations for imports to the USA they will not be taking jobs away from the USA but from China. Also, for the time being Panama’s chief exports to the USA are cantaloupe and watermelon.

In his testimony before the Senate Foreign Relations Committee the chairman and CEO of Caterpillar, Jim Owen, testified that after NAFTA was ratified his company quadrupled their exports of heavy equipment to both Canada and Mexico. His expectation is that a free trade agreement would do the same for Panama. With the Panama Canal Expansion moving along this would be especially beneficial for US equipment exporters.

Panama already has a favored nation status in exporting to the USA. The chief beneficiary of an agreement would be the USA in achieving more exports. However, Panama would also benefit from cheaper imports of desired US products.

Despite a worldwide recession Panama’s economy grew at an annualized rate of 3 percent in the first three months of 2009. It would seem that the USA would want to do more business with Panama and to increase its exports to and investment in Panama.

With the Panama Canal Expansion on its way Panama can expect to see substantially more growth as the recession lifts providing more markets for US products. As regards outsourcing there is a move afoot to move more outsourcing jobs back to the Western Hemisphere. Communication is easier and there is more English spoken in Latin America than in China. Thus it might make sense to do more business with Panama and to use its unique position astride the Panama Canal and Pan American Highway to prep parts for US final assembly.

Panama investment, real estate, and business are all growing and should be an enticement for more US investment. A ratified free trade agreement is the right way to go.

In the meantime Panama real estate is a great deal, both for residential buyers and for multinationals thinking of a Latin American presence. Panama has a first world infrastructure as well as its unique location for transportation. As Panama improves its ports and cargo handling capabilities its strategic importance will only improve for those interested in doing business with an increasingly prosperous Latin America.

If you are interested in looking at targeted commercial real estate investments, a second home, a retirement condo on the Bay of Panama, or just a little spot on the Pacific from where you can go out fishing come to talk to us at ABPanama. We are bilingual, do business throughout Panama and have over 23 years experience managing real estate portfolios.