Panamanian Wood in Luxurious European Yachts

Since 2019, copper has strongly entered to give a new face to Panamanian exports,increasing from $1.339 billion to $3.303 billion in four years. However, beyond this metal, there is a wider and more diversified exportable offer.

According to Víctor Pérez III, President of the Panamanian Exporters Association (Apex), even in years of pandemic, exports have maintained a positive momentum.

The growth in the last year, excluding copper, was 18%, and between 2020 and 2022, it reached 34%, the highest figure in the last 12 years according to the Ministry of Commerce and Industries (Mici).

Among the products that have seen a strong increase in exports is palm oil, which rose from $15.5 million in 2017 to $45.8 million as of November 2022, according to statistics from the the Statistics and Economic Analysis section of the Vice Ministry of Foreign Trade.

There has also been a boom in pharmaceutical exports, increasing from $3.2 million to $43.7 million in the mentioned period. Meanwhile, shrimp exports have recovered, reaching $58.2 million as of November 2022, with the first shipments going to the Bahamas.

Engineer Pérez III highlighted the evolution of the timber sector in exportation.

Previously, the exported timber was 100% raw material, in log form, to be processed in Asia. Now, it is being exported in cut form for specialized markets, such as yacht flooring in Europe.

10%

"The export of wood increased, destined for Germany, Italy, and the United States."

14%

"The export of fresh bananas decreased. For the first time, in 2022, Panamanian wood, whose exports grew by 10%, reached Germany, Italy, and the United States."

The idea is that our export items, over time, transition from exporting raw materials or primary products to exporting processed or semi-processed products," stated the president of Apex.

"These numbers have managed to compensate for other traditional sectors that have not performed well in recent months, such as fresh bananas, which decreased by 14%, fish and fish fillets, with a 3.5% decline, and fish fats and oils, which fell by 37%."

From a Free Zone in Colón dedicated to re-exportation, the other free trade zones are focusing on processing raw materials and the production and export of goods, as is happening, for example, in Panama Pacific, Panapark in East Panama, and others located in the interior

"They are an engine for generating employment and strengthening our export ecosystem," said Perez III.

An interesting case is happening in the Pesé Free Trade Zone, where Flor de Caña rum, originally from Nicaragua, has established a center to enhance its packaging and aging processes with the aim of exporting.

"Panama is becoming a hub for rum packaging," highlights the exporter, who also mentions the experience of Ron Diplomático from Venezuela, which has its facility in Panapark, where its product matures before being bottled and exported worldwide."

This has allowed rum to become an export product of Panama, with a growth of 47% in the last four years and venturing into new markets such as Belgium and Portugal.

The role played by the free trade zones is causing them to be included in Panama's export figures.

Según cifras preliminares de la Contraloría General, las exportaciones de bienes manufacturados dentro de las zonas francas y Panamá Pacífico suman $196 millones.

Esto indicaría que si se incorporan estos números, las exportaciones nacionales sin el cobre andarían por $989 millones, cerca del umbral de los mil millones de dólares.

The important thing is for local and foreign investment to see that exporting from Panama is easy, that it is a country friendly to export processes, which requires efforts from the private sector to generate investment and take advantage of it," emphasized the Apex executive.

Meanwhile, from the Vice Ministry of Foreign Trade, it was reported that among the actions being taken to continue increasing exports, there is a focus on strengthening traditional exports and continuing to promote the diversification of the exportable offering with added value.

"According to Perez III, it's a collaborative effort for the export sector to convey current and future needs regarding international market opportunities, and for the government to create the infrastructure and regulations to ensure that those opportunities are capitalized upon."