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Remarks on the U.S.-Panama Trade Promotion Agreement

Friday, May 17, 2013

Acting Secretary of Commerce Rebecca Blank
Remarks on the U.S.-Panama Trade Promotion Agreement

Thank you, Mr. Belanger and also AmCham President Fonseca. I want to thank the Chamber for its hospitality as well as its leadership in promoting a vibrant commercial relationship between Panama and the U.S.  In addition, I understand that this Chamber has been very active in supporting business transparency and corporate social responsibility. Those are important issues and I commend you for taking them on.

With double-digit growth in Panama’s economy over these past two years, it’s clear that Panama is poised for continued success. And it is exciting to be here in Panama to see that growth first-hand, and to hear about future plans from the people who are doing business here.

Today, I saw part of the expansion project for the Panama Canal – one of the world’s greatest engineering marvels. Sometime in 2015, this expansion will start allowing more and larger ships to pass through.  This will be a dramatic accomplishment for Panama, a boost for the entire region, and a powerful catalyst for global trade.

Also this morning, I met with Minister of Commerce Ricardo Quijano as well as President Martinelli to discuss how we can deepen our bilateral relationship.

It is clear that the U.S. relationship with Panama and other Central American countries has never been more important.  President Obama himself highlighted these relationships two weeks ago when he met with President Martinelli and other heads of state in Costa Rica.

Over the last six years, U.S. exports to Central America have nearly doubled (94 percent) and the reverse is also true (87 percent). And broad-based economic growth is helping to solidify the political and social gains that this region has achieved over the last two decades.

More broadly, President Obama recently noted that “this is a moment of great promise for our Hemisphere.”

The relationship between Panama and the United States, of course, will be crucial to making the most of this moment.  We have a particularly unique friendship.  Not only do we share a common currency, but we also share common beliefs in human rights and democracy, a common commitment to regional security, and a common vision for prosperity for our citizens.

Our six-month-old free trade agreement is an excellent example of how our relationship continues to flourish – and I want to thank the Chamber here for its tireless advocacy and support for that agreement as it was being approved in the US and in Panama.

The new agreement is reducing red tape and other barriers to trade – particularly important for small businesses in the United States.

It is also fostering an environment that encourages greater flows of business investment, and it is strengthening our joint commitments in areas such as intellectual property protection.

We have been tracking the agreement’s impact since it was implemented last October. In just the first five months of data we have gathered, we can already see that it’s a win-win.

U.S. goods exported to Panama have jumped 20 percent compared to the same period in the previous year. And while Panama’s exports to the U.S. are still comparatively small, they have jumped even more–34 percent–during that same time.

The two-way trade relationship between Panama and the United States is now over $10 billion a year, over five times higher than it was just a decade ago.

And the best part is, we are poised to do even more business together.

I am delighted to be here today with a delegation of 20 U.S. businesses.  They’re interested in serving as partners on key infrastructure projects. Could all of them stand for just a moment so we can see you?

These businesses are aware that the new trade agreement eliminates many tariffs for U.S. products in areas such as construction equipment and machinery while also further opening up Panama’s vibrant services sector. 

Perhaps more importantly, they know that Panama has laid out an ambitious plan to invest about $15 billion over the next several years in infrastructure projects and upgrades: including mass transit, airport expansions, highways and roads, and water supply and sanitation. And I should note that this is in addition to the $5 billion being spent for the canal expansion.

Some businesses here today, in fact, are already active in helping strengthen Panama’s infrastructure. For example, Chen Moore and Associates was selected as the prime consultant for designing a water treatment plant here. And software systems from OSIsoft are being used in hydrogeneration facilities here in Panama.

All of the businesses on this trade mission are here to offer even more products and ideas that can help Panama build and grow. These range from cutting-edge technologies to world-class consulting and engineering services. Some of the businesses are big and experienced.  Others are small and nimble. And they know what everyone in this room knows: A strong infrastructure in Panama will bring benefits not only here, but also in the United States. 

Those shared benefits are easy to understand once you know that two-thirds of the Panama Canal’s ships travel to or from ports in the United States.

But it’s not just the U.S. private sector that wants to see Panama continue to grow and thrive. The U.S. government itself also understands that we have a role to play in helping create the right conditions for growth.

For example, the Overseas Private Investment Corporation–an agency with me on this trip–is helping with everything from microlending for small businesses to financing for a mobile phone network.

In addition, the U.S. Trade and Development Agency–also with us on this trip–recently funded a grant to help guide expansion of passenger and cargo infrastructure at Tocumen International Airport.

And beyond the Commerce Department’s daily efforts to promote trade, we are also reaching out to support Panama as it hosts the Americas Competitiveness Forum later this year. At that Forum, we want leaders throughout the Americas to come here and see how the expansion to the Panama Canal is a key project that will help increase competitiveness throughout the Western Hemisphere.

With all of the partnerships forming between our governments and our businesses, it’s easy to see that the U.S. and Panama will continue to have a strong future working together into the 21st century.

And, fundamentally, our partnership will be grounded in the strong personal ties that continue to flourish between our two countries.

You may not be aware of this, but the Commerce Department is home to the U.S. Census Bureau, which surveys the entire U.S. population every 10 years.

In 2010, we found out that about 165,000 Americans identified themselves as Panamanian. It’s a relatively small group, but one that makes substantial contributions to the tapestry of the United States.

Panama has brought us famous baseball players like Mariano Rivera, who just announced that he is retiring after a long career with the Yankees.

Panama has given us heroes like Shoshana Johnson, who became a U.S. soldier, served in Iraq, and was a prisoner of war for 22 days.

And, Panama has given us business leaders like Ursula Burns, the CEO of Xerox, whose parents were Panamanian, and who I’ve had the pleasure of working with on President Obama’s Export Council.

Clearly, our governments, our businesses, and our citizens are linked together more than ever before.

I am pleased to be part of this effort.  The companies with me today are symbolic of the growing number of U.S. companies that are hoping to invest and work in Panama in the years ahead.

And as the commercial relationship between Panama and the United States continues to grow, our economic futures will become even more intertwined, helping grow the middle class and bring prosperity to citizens throughout our countries. 

Thank you.