Panama Diamond Exchange Joins WFDB
Sunday, May 18 2008 @ 08:47 PM UTC
Contributed by: Don Winner
It is a region that has a combined population of approximately 700 million people, which is the equivalent of the United States and Europe together. It also is a part of the world that is benefiting from tremendous prosperity as a result from its ongoing development. There currently are more than 11,500 jewelry stores spread around 20 different South and Central American countries and 23 Caribbean islands, which together generate an annual demand for diamonds and jewelry of more than $7 billion.
We see the Panama Diamond Exchange serving the diamond industries both within Latin America and outside of it. For suppliers and buyers of diamonds from North America, Europe, Asia and the Middle East, it will provide a "under one roof" hub to the lucrative but far flung markets of Latin America. At the same time, members of the jewelry trade in Latin America will be able to buy and sell diamonds in an easy to reach, and secure and stable environment, where they can conduct their business comfortably in Spanish. To date they have had to travel massive distances to buy diamonds and jewelry, and this undoubtedly impacted the growth of the diamond markets in the region.
One of the questions that we often are asked is: Why Panama?
Geographically, Panama sits at the very meeting place between Central and South America. It is not only home to the famous canal but it also is the financial capital of Central and South America, with some 130 banks operating in Panama City alone. Last year the country saw exceptional economic growth, during which Panama's economy expanded by more than 11 percent, second only to China.
The business community in Panama has been aided by the fact that the U.S. dollar is the country's official currency. A further advantage is the Panama Duty Free Zone established in 1948. It now has an annual turnover of goods and products totaling more than $18 billion, and is considered to be the second-largest free trade center in the world after Hong Kong. Companies establishing businesses in the free zone are largely exempt from paying taxes, meaning all profits earned from re-exportation are free of tax. Only profits on sales in the Republic of Panama are subject to tax. This benefit is being extended to the diamond industry.
The government of Panama, headed by President Martin Torrijos and Vice-President Samuel Lewis Navarro, has been a very strong supporter of the Panama Diamond Exchange project right from the start, because it sees it as part of a long-term strategy of establishing the country as Latin America's primary provider of financial and business services. It is for this reason that the government has agreed to grant the area of the Panama Diamond Exchange with permanent Free Zone status, eliminating taxes and duties on transactions conducted within its confines.
The government has given its strong support to the establishment of a jewelry complex in the heart of Panama City, which eventually will house our bourse's permanent residence. The future tower will feature a 48-story secure and state of the art building in the financial district of Panama City, and will include the bourse trading hall, as well as company offices, showrooms, gem labs, restaurants and banks.
We consider our affiliated membership to the WFDB to be an essential component in our development, and we are fully aware that this is an important element in the Panama Diamond Exchange achieving international recognition. We are equally convinced that the Panama Diamond Exchange will be a valuable addition to the WFDB, for it will open to its bourses' members the vast and largely untapped markets of Latin America.
We hope that our application for WFDB membership meets with your approval.
I would like to take this opportunity and invite you all to the Republic of Panama and to the Panama Diamond Exchange, and as we say in Spanish - BIENVENIDOS!