The British Chamber in Panama is back with its annual Business Forum, titled “Panama: a look at tomorrow”. The focus this year is on the elements necessary for Panama’s continued economic growth, and increased regional competitiveness.
Throughout the full-day conference, a series of panellists in four separate committees will try to debate how four elements can propel the local economy much further, and position Panama to be a business powerhouse in the coming years. The combination of governmental and private-sector panellist will be tasked with evaluating Panama’s achievements in developing these four areas, both on a public and private level, and the challenges facing them. Finally, the panellists, along with the attendees, will make a series of recommendations on how both government and companies can develop/improve these sectors.
Panama’s education sector is prepped for massive improvements in 2017, with government initiatives and private sector customisation raising local standards to an international level.
Although the fast pace of economic growth has outrun Panama’s education sector by a wide margin, the Ministry of Education of Panama (MEDUCA) has identified various areas for improvement. The government is currently investing approximately 3.5% of national GDP into the educational sector, but the target is to raise that figure to at least 6% over the medium term in order to bring the sector back up to speed.
Panama’s public education system in particular has faced challenges in recent years. According to the World Economic Forum’s Global Competitiveness Ranking for 2016, Panama’s quality of education was ranked 94/140; notably lower compared to other measures of Panama’s economy and society. In response, Panama recently expanded access to universal primary education, especially for indigenous and rural communities, where the quality of education is often negatively affected by external circumstances.
In the shadow of the massive Panama Canal expansion, Panama is in the process of shifting its attention away from large infrastructure development toward the betterment of educational facilities, training programs and human capital. With recent statistics in mind, Panama’s 2015-2019 Strategic Government Plan has outlined a host of investments, with 55% dedicated towards social projects in education and healthcare. This is set to benefit the over 800,000 students who were enrolled at educational institutes for the 2016-2017 school year.
The ITSE project (Proyecto Institutos Técnicas Superiores) is an initiative led by President Varela himself, which aims to provide technical skills to young Panamanians. The investment in this project is expected to be US$75 million and will be located in the eastern part of Panama City. Construction of the ITSE principally aims to provide educational opportunities for 10 thousand students in two daytime shifts and create coordination with the labour sector. The teaching team will be made up the 250 teachers with high academic qualifications.
With an increasing number of companies moving their headquarters to Panama, HR companies also see the country as a promising place to do business. The number of universities producing talented and skilled human capital is destined to increase the attractiveness of the local education sector as well as the pool from which companies both local and global can recruit new hires.
- What have been some of Panama’s achievements in developing qualified human capital?
- What have been some of the regional trends in human resources?
- How are multinational companies contributing to the development of skilled workers in Panama?
- How do immigration policies affect the ability of companies to bring in qualified labour?
- What initiatives to universities take to cooperate with the private sector to give students real-life work experience?
The Panamanian government and the business sector actively encourage direct foreign investment. In general, the laws do not tremendously differentiate between national and foreign companies. In 1998, the government enacted a law of investment stability, which guarantees foreign investors who invest at least two million dollars in Panama, equal treatment by law by their domestic competitors. By virtue of law No. 41 of 2007, Panama has encouraged multinational companies to open their regional headquarters on its territory through a variety of different tax incentives.
The business friendly economy, managed and regulated by the Ministry of Economy and Finance, is party to over 20 trade agreements. Liberal in nature, there are virtually no currency restrictions in place and no limits to foreign ownership, or curbs on mergers, acquisitions or joint ventures.
However, there are certain areas that do need improvement. Most notably, Panama has implemented dramatic reforms to its financial regulations, which have impacted businesses being able to move funds, and declare taxes. Additionally, there are still issues with a slow judicial system, and corruption in resolving commercial disputes. Finally, bureaucracy in public institutions prevents some businesses from growing at the rate they would like.
- What measures is the Government taking to address corruption/inefficiency issues in their institutions?
- How are private companies coping with the new financial/tax regulations implemented over the past few years?
- What are the main obstacles investors faces in Panama?
- Does the Panamanian Government regularly consult with private companies before developing and implementing new business laws?
- Are there any plans to develop laws that would promote investments in certain under-looked sectors?
IT and telecoms are a major driver of Panama’s growth, sparking innovation and activity across the country. With the World Bank forecasting GDP growth of nearly 5.5% for 2017 and 2018, Panama is poised to continue expanding at an impressive rate.
The country is currently ranked 53rd in the pillar of technological readiness and 49th in innovation of the Global Competitiveness Index. Panama boasts 174 mobile phone and 15.6 landline subscriptions per 100 people, ranking the country at 8th and 67th in each respective category.
The country performed well in the categories of availability of latest technologies. According to the WEF, 51.2% of the population are internet users and there are 7.9 fixed broadband internet subscriptions per 100 people. Additionally, internet bandwidth is 7.9kb/s/user, which compares favourably to other countries in the region.
According to the most recent available statistics from the World Bank, the ICT sector is growing faster than the economy as a whole, contributing more than USD2.4 billion to the Panamanian economy. While Panama is a strong exporter and importer of ICT goods, ICT imports represent more than 8% of total imports.
ICT has formed the backbone of new initiatives aimed at improving the persistent social issues in the country. Firms are recognising that new technologies are capable of transforming the way institutions and communities interact with one another and the government. One of the objectives of the Panamanian Government is to digitalise the public services, and be more accessible to the citizens of the country.
- How will Panamanian companies adopt latest technological advances?
- What are some of the deficiencies/challenges that companies face when trying to innovate?
- Are there specific sectors that could benefit from keeping up with new technologies that are developed?
- Could Panama become a centre for innovation?
- What is being done to facilitate knowledge/tech transfer between successful multinational companies and Panamanian entrepreneurs?
Largely known for being the hub of the Americas, its Canal and ease of doing business, Panama continues to go from strength to strength. Panama leads Latin America in terms of its macroeconomic environment, the efficiency of its goods market, its financial market development and level of business sophistication.
Among the advantages of doing business in Panama, respondents from the World Bank’s Executive Opinion Survey cited its foreign currency regulations, stable government, the lack of inflation, and stable policies as the top factors, while corruption, inefficient government bureaucracy and an inadequately educated workforce were cited as the top issues facing businesses. Indeed, Panama has much to do to improve its reputation in the wake of the Grey List and Mossack-Fonseca Papers scandals.
The country was largely built upon the tenets of international trade, business friendly initiatives and a growing reputation as Latin America’s business hub, and it continues to enhance its global and regional prominence through free trade agreements. The vast majority of its economic activity (almost 80% of GDP) is based on its services sector, which includes the Canal, activities in the Colon Free Trade Zone, banking, container ports, and flagship registry.
Panama is heavily dependent on foreign investment. In 2016, FDI influx into the country reached over USD 5.2 billion (a 15.9% increase over the previous year). This good performance is due to the advantageous regulations for FDI and the incentive measures that the country adopted in 2011. (2017, SantanderTrade.com.) The government actively promotes it as a first rate place to do business through the Ministry of Trade & Industries trade promotion office, PROINVEX.
- How has the rate of foreign investment changed in Panama?
- Is Panama, as an economy, heading the right way in terms of recovering from the international scandals in the past few years?
- What sectors have seen the most growth in FDI?
- Compared to other countries in the region, what benefits does Panama provide multinational companies?
- Is there a risk for Panama losing FDI to regional competition?
Programme of Events
07:30 – 08:00
|08:00 – 09:15||General Session I|
|08:00 – 08:05||Welcome by Samantha Whay-Jenkins | BCCP Chairman|
|08:05 – 08:10||Welcome by Damion A. Potter | | British Ambassador to Panama|
|08:10 – 08:40||Keynote Address: ‘The View from Government’
HE Nestor Gonzalez | Deputy Minister of Foreign Trade
How Panama’s Government prioritises policy around the elements necessary for its sustained economic growth.
|08:40 – 09:10||Keynote Address: ‘The View from the Outside’
How the UK’s Northern Powerhouse Initiative can serve as a template for Panama, for public-private cooperation on revitalising/developing the economy.
|09:10 – 09:15||Explanation of Committee Breakout Sessions|
|09:15 – 09:30||Coffee Break|
|09:30 – 12:30||Breakout Sessions|
|Developing Trained Human Capital|
|Sponsored By||Moderator: Samantha Whay-Jenkins | King’s Training Panama|
|Maria Lourdes Peralta | ITSE Coordinator at the Ministry of the Presidency of Panama|
|Dianeth Salazar Garcia | HR Manager at London & Regional|
|Dominik Rus | Corporate Training Director at COPA Airlines|
|Strengthening Government Frameworks|
|Moderator: Dan Boersner | Biwater|
|Jonathan Diaz | Director of the Multinational Headquarters Regime|
|Korosh Farazad | CEO at Farazad Investments|
|Maximo Guisasola | Finance Director at GSK|
|Adopting Technology & Innovation|
|Sponsored By||Moderator: Bryan Bogensberger | Quiver & Pandemonio|
|Irvin Halman | Administrator of the Governmental Innovation Authority|
|German Lleras | Regional Director at SDG|
|Diego Eleta | VP of Panamanian Chamber of Technology|
|Promoting Inward Investment|
|Moderator: Ariel Perez Price | British Embassy|
|Alberto Aleman | Director of PROINVEX|
|Chris Cooke | Managing Partner at Rooks Rider Solicitors|
|Jorge Juan de la Guardia | Vice-President of the Panamanian Chamber of Commerce|
|12:30 – 13:45||General Session II|
|12:30 – 13:10||Breakout Sessions Summaries by Committee Moderators|
|13:10 – 13:40||Keynote Address: ‘The View from the Canal’
HE Roberto R. Roy | Minister of Canal Affairs
How the Panama Canal serves as a catalyst for the country’s economic growth, and a model for other private and public institutions to follow.
|13:40 – 13:45||Closing by Dan Boersner | BCCP Vice-Chairman|
|13:45 – 15:00||Networking Lunch|
Our Speakers & Panellists
HE Roberto R. Roy
Minister Roy graduated from Georgia Tech University with degrees in Mechanical Engineering and MBA. He participated in the Blue Ribbon Engineering Committee, which along with the US Army Corps of Engineers, drafted the details of the modernisation and expansion of the Panama Canal. He also established one of the most well-known construction companies in Panama, Ingenieria R-M. Minister Roy has presided over many organisations, both in the public and private sectors.
HE Nestro Gonzalez
Deputy Minister Gonzalez graduated from USMA University with a Bachelor’s in Law & Political Science, and MBA. He is a lawyer by profession, and has actively participated in the tourism sector by being part of the Panamanian Tourism Chamber and the Hotels Association. DM Gonzalez has significant experience in the private sector, and brings his knowledge to his current position.
Developing Trained Human Capital Committee
Maria Lourdes Peralta
Maria Lourdes graduated from Purdue University with both a Masters and PhD in Civil Engineering, and has spent the past 20 years teaching at the Technological University of Panama. Currently, she’s the Coordinator of the Technical Institutes Programme, which aims to train young Panamanian students in technical skills.
Dianeth Salazar Garcia
Dianeth graduated from the Universidad del Istmo with a degree in Business Management, with a focus on HR, and a Masters in Organisational Behaviour from the Universidad Latina. Throughout her career, she has taken up many human resources positions in banks and insurance companies. Today, Dianeth is the Human Resources Manager at London & Regional Panama.
Dominik graduated from Georgetown University with a PhD in Neurolinguistics. He is an expert in brain-based approaches to learning, learning & development, and leadership & management training. He has worked in various companies such as Kaplan, Integrity Solution Services, and is now the Corporate Training Director at COPA Airlines, overseeing all non-technical learning initiatives.
Strengthening Government Frameworks Committee
Jonathan has a varied background in law, translation and business. He obtained a Law Degree and Diplomas in Finance and Translation from Universidad Latina, and subsequently a Masters in Management from Tulane. He worked in several firms as a translator and legal advisor. Additionally, he has worked in project coordination and operations management. Currently, Jonathan is the Director of the Multinational Headquarters Regime at the Ministry of Trade and Industries.
Mr. Korosh Farazad is the Founder of Farazad Investments, Inc. and serves as its Chairman and Chief Executive Officer. His company facilitates medium-to-large scale financing for a variety of different projects around the world.
Korosh initially began his career in the USA and the Caspian Sea region, working on financing oil drilling projects. By 2005, FI’s strategic partnerships expanded the company’s ability to provide in-house financing to small-cap companies. Today, Korosh Farazad is based out of London, with offices in New York, Dubai, Beijing, and Melbourne.
Mr. Guisasola graduated from the University of Buenos Aires with a degree in Management and Economics. His career has spanned three British multinational companies- EY, BAT & now GSK, where he has worked for the last nine years. Maximo is a specialist in the finance and accounting side of companies, and is currently the Commercial Finance Director for GSK in the region.
Adapting to Technology and Innovation Committee
Irvin A. Halman is the current Administrator of the Governmental Innovation Authority (AIG). He serves on the Boards of the National Council for Governmental Innovation, Universal Service and Access, Competitiveness Council of the Government of Panama, National Competitiveness Centre public-private sector partnership. Halman is the former president of the Chamber of Commerce, Industries and Agriculture of Panama, former president of the Institute of Corporate Governance of Panama, and has a successful career in working as an executive in several multinational companies.
German is the Regional Director of Steer Davies Gleave for Latin America. In his experience as a transport engineer and urban planner He has had the opportunity to work on important projects for the development of transportation infrastructure in Latin America. It highlights its participation in the planning and implementation of the first phase of the TRANSMILENIO system and the technical structuring of several motorway projects. He is currently responsible for the strategic direction of the company’s offices in Latin America.
Mr. Diego Eleta is the Vice-President of the Panamanian Chamber of Technology. He serves as the Strategy, Operations, & Technology Director at Deloitte. He was the Founder and first President of the E-Commerce Committee and started the current E-Commerce Initiative in conjunction with the Inter-American Development Bank. He has also served as the President of the Panamanian Chamber of Commerce & Industries. Mr. Eleta graduated from Cornell University in 1989 and later gained his MBA from Columbia Business school.
Promoting Inward Investment Committee
Alberto started his career as a Political Counsellor in the Permanent Mission of Panama to the United Nations. He worked on a number of areas including Economic and Financial affairs, and multilateral processes. Alberto then moved to the Business Development Manager role at London & Regional, the masterplanners of the Panama Pacifico Special Economic Area, where he focussed on attracting foreign direct investment. Currently, Alberto is the Director of PROINVEX, Panama’s trade promotion agency, where he continues the work of attracting foreign investment here.
Mr. Chris Cooke is a Senior Partner at Rooks Rider, and specialises in Corporate & Wealth Planning. Chris runs Rooks Rider’s trust practice which is designed to maximise profits from business in the UK and elsewhere. He represents trustees in all the major offshore jurisdictions including Bermuda, the Caribbean, Liechtenstein, the Far East and the Cook Islands. Chris sits on the International committee of STEP, and is a judge on their “Chambers of the Year” awards.
Jorge Juan de la Guardia
Mr. de la Guardia graduated from Duke University with a degree in Economics, Markets & Management, and an MBA from ULACIT. Currently, he is the CEO of the Panamanian franchise of Dollar Rent-A-Car, and is the Vice-President of the Panamanian Chamber of Commerce & Industries.
Thank you to our Sponsors
PLATINUM: Trust Services SA
GOLD: KPMG & AFRA
COMMITTEE: Wyndham Hotel Albrook Mall, EF, & ANORCO
CHAMBER PARTNER: King’s College School