Transparent banking benefits economy
PANAMA IS FURTHER DEVELOPING ITS ECONOMY THROUGH THE MOST PROMISING SECTORS: TELECOMS, TRANSPORT AND TOURISM. FOR THIS, FOREIGN INVESTMENT IS NEEDED AND A TRANSPARENT BANKING SYSTEM PUTS PANAMA IN A GOOD POSITION

NORBERTO R. DELGADO D. Minister of Economy and Finance. Along with President Moscoso, his task is to increase Panama’s economic possibilities. Strengthening the banking sector–which has always been at the forefront of innovation and trends towards globalization– has been one step, by creating more transparency.

Foreign investors hoping to take advantage of the many opportunities currently opening up in Panama should perhaps take note of one very important fact: one place where one must make a good impression is Panama’s powerful Economy and Finance Ministry, through which all contracts from public institutions must be approved.
Panama’s economy is based on a well-run and developed service sector, which accounts for approximately 80% of the nation’s GDP. The Panama Canal, the Canal Zone, a modern telecommunications infrastructure, the Colon Free Zone and the country’s booming international banking industry all contribute to form the foundation of the service sector.

"The next great push for Panama is going to be the expansion of the Canal. This is the project that is going to change the whole economic outlook of Panama," Economy and Finance Minister Norberto R. Delgado. enthuses. "We are only waiting for the plans from the Canal administrator to begin. The decision will be made soon, in about six months, and the cost will likely be somewhere in the region of $5 billion."

Among other advantages, the Canal’s expansion will allow the largest ships to pass through without having to first unload some of their cargo to be transported by rail to the other end of the Canal, an improvement that is guaranteed to save both time and money.
A further 12% of Panama’s GDP is taken up by manufacturing, mining, utilities and construction, and all these sectors have flourished since free market reforms in 1998.

"I believe that Panama holds plenty of opportunities and its characteristics are well defined. We are very aware of our possibilities, like telecommunications for example. For this reason we have developed a call center law that has allowed the country to develop as a center of operations for international calls and this has facilitated economic activities on a large scale.
"Panama also has a very stable economy. Here, there is a bank failure every 10 years, while on average a bank is going belly-up every half hour somewhere in the world. Banking fundamentals here are strong. This is the direction that the country must follow and my responsibility, along with the President, is to increase Panama’s possibilities,” the Minister asserts.

According to Mr. Delgado, the government’s strategy is to concentrate on what it knows the country does well, namely telecommunications, transportation and tourism.
"With the Free Trade Area of the Americas in sight, it is clear that we have to be exporters and attract more tourists. We don’t want to weave fabric or make furniture; we want to transport them. Panama is a safe place to invest, and is a port nation that is going to develop what it needs to develop.
"As far as finance and banking is concerned, Panama has strengthened its laws and two years ago the country created a strong, solid superintendence of banks. Between 1999 and 2002, all Panamanian banks have to readjust to this new reality of transparency," Mr. Delgado stresses.

And that spirit of transparency is exactly what the National Securities Commission is looking for as it carries out its job of regulating and supervising the country’s stock market, says President of the Commission Carlos A. Barsallo P.
"Transparency is the key word in all the agreements we dictate over. The laws are not simply applied on a whim. We have to follow a very rigorous procedure, something which several years ago didn’t happen all that often in Panama. It is one of the better aspects that we have modeled on the system in the United States," notes Mr. Barsallo.