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Business & Economy Briefs

Panama, Singapore sign free trade agreement

by Eric Jackson

On March 1 Second Vice President Rubén Arosemena got down to the main business of his trip to Europe, Africa and Asia, and signed on Panama's behalf a free trade agreement with Singapore. The talks had been ongoing since the Moscoso administration, and the agreement builds the link between two of the world's most important trade crossroads.

Shipping from Singapore through Panama is not much of a factor, as it's shorter for a ship from that part of the world go to Europe or the East Coast of North America by way of the Suez Canal, and to get to Argentina and Brazil by sailing around the southern tip of Africa. Moreover, both Singapore and Panama are largely service and commerce economies. However, they do more manufacturing than Panama does, and we do more agricultural production than the Singaporeans.

So what, other than fish and filete, do we have to offer them? "We are convinced that this commercial treaty will permit the businesses of Singapore to have a platform in Panama from which to enter the markets of the Americas, which will redound in benefits for both of our economies," Arosemena said.

Singaporean businesses have moved quickly to grab the opportunities. For the first time there will be a Singapore pavillion at this year's EXPOCOMER trade fair. Singapore Aerospace Technologies signed an agreement with the new Panama Pacific Special Economic Area with a view to setting up aircraft maintenance and repair facilities in hangars at the old Howard Air Force Base, and expects to be open for business early next year.

On the Panamanian side there are hopes for more than just a Singaporean business platform and another market for this country's beef. Singapore is more technologically advanced than Panama in many ways, and there is an expectation that some of its technological and industrial skills will be transferred in a way that will boost the overall Panamanian economy. As economist Alexis Soto put it, "prosperity without development from colonial times must be surmounted" by a Panamanian policy of attracting Singaporean manufacturing and high tech businesses here.