Panama trade minister maintains China focus

Q: How has Panama’s co-operation with China developed since the establishment of diplomatic ties?

A: Co-operation with China is improving constantly. If diplomatic relations with China began in 2017, trade relations have been there for more than 50 years; China is the main trade partner of the Colón Free Trade Zone [the biggest in the country and one of the biggest in Latin America]. We are now expending efforts to enable our main agriculture products to comply with the standards required for them to be exported to the Chinese market. We are talking about beef, pork, fruit and coffee, as well as fisheries and drinks.

Q: Is this activity connected with the negotiations for a free-trade agreement [FTA] started by the previous government?

A: This is a trade agenda that we are developing regardless of the FTA negotiations. Clearly, the FTA would be an additional piece to the development of our ties with China, but at this moment we want to bring our productive sectors up to speed in order to get them ready to make the most of a future possible FTA with China.

With other countries, we put the FTA first and we couldn’t get the most out of them. This government wants to do things in a different way: we want to make sure everything is in the right place to reap the maximum benefits from an FTA with China.

Q: Is the FTA with China a priority for the new government?

A: It is something for the years to come, but not necessarily a priority in this moment. Right now, we want to prepare our products to be exported to China, but also show Chinese companies that Panama can be their gateway to Latin America.

Q: Countries around the globe are assessing the risks attached to building 5G telecommunications networks in partnership with Chinese telecoms powerhouse Huawei.  What is your position on that?

A: That is an issue between the US and China, but it clearly affects other countries. In Panama, Huawei’s local operations are regulated under the legal regime of multinational corporations and, from its local offices, provides telecoms services for the whole region and deals with the sale of its retail products. Certainly we are sensitive to security concerns, but it is not up to the Ministry of Trade and Industry to deal with them.

Q: The free zone programme along the Panama Canal has generated huge volumes of trade, but has had little impact on local communities such as those in Colón. What are you doing to increase the economic and social dividend of the programme?  

A: We want to be a hub for added-value light manufacturing; in other words, using the free zones for the development of light manufacturing and the processing of agriculture products. That added value would generate more value for the local producers and communities. In the past, companies would mostly focus on importing and re-exporting, and that wouldn’t necessarily generate much spillover.