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Tuesday, December 12 2017 @ 12:53 PM EST

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HSBC Sells Panama Operations To Bancolombia

Money MattersThe bank HSBC Latin America Holdings, a subsidiary of HSBC, announced today that it has reached an agreement to sell HSBC Bank (Panama) to Bancolombia SA for $2.1 billion.

In a statement, HSBC said the transaction is subject to the approval of regulatory authorities and other conditions, but is expected to be completed in the third quarter of 2013.

The sale by the bank, represents a milestone in the execution of HSBC's strategy implemented since May 2011.

The CEO of HSBC Latin America, Antonio Losada, said today that it is the "46th sale / closing globally since the start of 2011, and is a sign of commitment to the region with the group's strategy" aimed at focusing on major markets such as Brazil, Mexico and Argentina.

The note adds that as of September 30, 2012, estimates indicate HSBC Bank (Panama) had total assets of $7.6 billion dollars, $5.7 billion out in loans, and $5.8 billion in deposits.

Editor's Comment: Many years ago I opened a bank account with Banistmo, and I was perfectly happy with them. Then HSBC came along and purchased Banistmo, so I "became" an HSBC customer by default. On the whole customer service declined. Then HSBC got caught laundering money for drug traffickers in Mexico and they were fined $1.9 billion dollars by the United States in a deal to make the criminal charges go away. Right after that was announced, HSBC closed my account in Panama, simply because I have a US passport. Thanks alot. Now they are selling out and leaving Panama. Good riddance.

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Teleton donations taxed by C & W

Money MattersDonate to Teleton? So easy by telephone, just dial the right number and you've donated your contribution. Then in January the bill comes in.... We all admire the Teleton efforts to raise money for really good charitable causes, and 20-30 does a bang-up job. The citizenry and residents contribute generously to such a well-run and worthy cause, and many can do it because making the donation is so easy by telephone. I've done it that way since they installed the technique. I've got two lines and got the bills in January expecting the additional charges. But I didn't expect the taxes to be so high. Wow. A little checking on the calculator and I found I had paid 7% on my donations to Teleton in December. We should be refunded our taxes for any Teleton donations. Why should the DGI benefit from the money donated to charity? That's not what the ITBMS, Ley 15, and Tasa PN are for.
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Bearer Shares Will Be Immobilized In Two Years

Money MattersThe Cabinet Council introduced the bill that will immobilize bearer shares, but with a twist: it will not take effect in the next three months, but in two years.

The immobilization of bearer shares is an important point for Panama to pass to the second phase of the Global Forum of the Organization of Economic Cooperation and Development and to keep the country from being included on discriminatory lists, according to arguments being made by members of the banking industry.

The meeting of the Cabinet was attended by two members of the Banking Association, Rolando de Leon and Raul Alba Guizado.

La Estrella consulted De Leon about the change, and he confirmed that the document presented for discussion included the extension of the effective date of the measure, but he said he did not know if the final version was approved that way.

The banker said he preferred for the guild to make a statement on the change.

Lawyers representing the banking industry sent a letter to President Ricardo Martinelli asking him to take into consideration some aspects before approving the project.

This Bill will be formally introduced to the National Assembly after the Carnival celebrations. (Estrella)

Editor's Comment: Bearer shares are often used by money launderers and people who are trying to avoid paying taxes as a way of hiding the true owner of any given company in Panama. This "immobilization" of bearer shares would mean there would be an official and approved method of knowing who owns what. The owner (or holder) of the bearer shares would be registered, erasing a degree of anonymity. And in true Panamanian fashion, they are extending the implementation out to two years - which will give all of the corrupt bastards time to find a new way to hide all of the money they have stolen over the years.

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Bahamas to form alliance with Panama

Money MattersBy Jeffery Todd - Leaders in The Bahamas have agreed in principle to form a Joint Business Development Alliance with Panama to boost bilateral trade and commercial relations.

Fresh off a delegation to Panama, the Bahamas Chamber of Commerce and Employers Confederation (BCCEC) seeks to further cement ties by holding annual meetings and engage in the frequent exchange of information.

The agreement, which has been obtained by Guardian Business, would also identify impediments and obstacles to trade and investment, assist in linkages and joint ventures and allow Bahamians to create "affiliate memberships" with the Chamber in Panama.

"The alliance would be co-chaired by the chairman for each section," the agreement stated. "The chairman and vice chairman, representing Bahamian and Panama sections, shall be appointed by the parties. Each side shall communicate to the other their designated chairman and vice chairman."

The imminent signing of a Joint Business Development Alliance could be the most tangible result of the recent delegation. Nearly two dozen Bahamians, representing shipping, logistics, construction, financial services and wholesale, joined the BCCEC, the Grand Bahama Port Authority (GBPA) and government officials.

Michael Darville, the minister of Grand Bahama, stressed the "commonality" between the two countries in regards the global trade industry.

Whereas Panama is well established in this area, Grand Bahama is only beginning to realize the scope of its potential.

Darville made special mention of the Panama Canal's expansion, due to be completed in 2014.

"Its relevance to international commerce has been reassumed and has drawn the attention of neighboring Caribbean countries, including The Bahamas, who are all looking for the best means to capitalize on the increased flow of ships. As demand is rising for efficient global shipping of goods, the canal is positioned to be a significant feature of world shipping for the foreseeable future," he said.

A number of other business opportunities were also explored during the trip.

Copa Airlines, now operating a direct flight to Nassau, was encouraged to start passenger and cargo opportunities in Grand Bahama. Improvement in airlift would bolster both the tourism industry and commercial activity.

Chester Cooper, the chairman of BCCEC, added that The Bahamas can learn from Panama through its formidable and successful arbitration center. The Ministry of Financial Services has already developed a council to focus on this area, he noted, and the country position as an "alliance partner" with Panama should only aid this endeavor. (The Freeport News)

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Cabinet Approves Scheme For Custody Of Bearer Shares

Money MattersBy DON WINNER for Panama-Guide.com - This afternoon the Cabinet Council approved the draft of a proposed new law adopting a regime of custody for the certificates of bearer shares issued by companies in Panama.

This proposal is part of the actions implemented by the administration of president Ricardo Martinelli designed to suit international standards, for Panama to be seen as a "cooperating country" in the fight against the misuse of financial services.

The proposal was presented by the Minister of Economy and Finance, Frank De Lima, who was backed in his presentation by the Superintendent of Banks, Alberto Diamond and two representatives of the Banking Association of Panama.

According to Minister De Lima, such a scheme will allow for the preservation of bearer shares, because the shares will have a private authorized custodian, with the goal of being able to ascertain who is the owner of said shares in certain cases, without affecting the free movement in a reserved manner.

Thus, he said, the proposal strikes a balance between international requirements on transparency and the needs of those who require the use of these legal instruments. (Press Release)

Editor's Comment: It's clear Panama's economic growth is pushing this administration towards more and more cooperation on issues such as this. In the past, when Panama was a relatively poor country, it made a whole lot of money that it otherwise would not have made by being a tax haven - a place where people could effectively and efficiently hide their money. But now that Panama's economy is expanding rapidly there are more and more benefits to play along with the rest of the internationally accepted standards in the fight against things like money laundering and tax evasion. Panama needs to be classified as a "cooperating country" on these issues, or else the nation could face sanctions. With this scheme, bearer shares will not be registered or public, however if necessary it will be able to determine exactly who owns what company. Right now if you've got the bearer shares in your desk, you own the company, and no one can prove it. That's a great thing if you want to do things like - oh, I don't know - sell government concessions for a casino and get paid through a shell company for the rest of your life. Just sayin'...

Copyright 2013 by Don Winner for Panama-Guide.com. Go ahead and use whatever you like as long as you credit the source. Salud.

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Costa Rican company Dos Pinos acquires Panama’s largest dairy company

Money Matters Dos Pinos, the largest dairy company in Costa Rica, on Sunday announced its purchase of Nevada, a producer of milk and fruit juices in Panama.

This company was owned by Refrescos Nacionales, a subsidiary of Panama’s national brewery, which belongs to the multinational SABMiller.

The information was confirmed yesterday by Jorge Pattoni, Dos Pinos general manager, in a statement indicating that the agreement was signed on Jan. 18.

Nevada is located in Chiriqui, a Panamanian province bordering southern Costa Rica.

The acquired infrastructure has an installed capacity to process 100,000 liters of milk per day and produces whole, skimmed, semi-skimmed and flavored milk, and also fruit juices under the brands Nevada and Tutti Frutti Chiricana.

Dos Pinos described the acquisition as “strategic” and part of its foreign expansion plans.

According Pattoni, Nevada controls approximately 70 percent of the Panamanian milk market.

Dos Pinos, a 100 percent Costa Rican firm, has 600 different lines of products and exports some $84 million annually. Currently, the company exports to Central America, United States, Trinidad and Tobago, Dominican Republic, Cuba, Aruba and Venezuela, among others.

The transaction must receive the approval of Panama’s Consumer Protection and Competition Authority to be final. (Tico Times)

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The Panamanian Government Will Require Importers To Buy Domestic Products (WTF?)

Money MattersThe National Government will reorder imports and domestic production so that importers buy domestic production with priority, while respecting national laws on imports and the provisions of the World Trade Organization.

That was the central theme of a meeting today between the ministers of Agricultural Development, Trade and Industry and Health, Oscar Osorio, Guillermo Quijano and Javier Diaz, respectively, and officials of the Food Safety Authority with representatives of the Front for the Rescue of the Agricultural Sector.

Minister Osorio said meetings will start on the 30th, in order to later submit a proposal to the Cabinet Council, and it is possible that this (production and imports) will be ordered by Executive Decree.

He guaranteed that as soon as it is approved and funding is obtained, they would start a campaign asking Panamanians to consume domestic products.

He explained they will require the placement of signs in public markets and places where products are put up for sale, indicating whether the products are domestic or imported.

Both Minister Osorio and the Minister of Commerce and Industry echoed the concerns of domestic producers in that the imports are not being sold as they should, and domestic and imported products are being mixed. (TVN)

Editor's Comment: Since the implementation of the Free Trade Agreement with the United States, now "domestic producers" (Panamanian farmers) are feeling the pressure of competition from the outside. These representatives from the Panamanian government have to tread a very thin line - because their wiggle room is narrow. All of these issues have been discussed and defined in the treaty. Of course they need to tell the Panamanian farmers what they want to hear, but in reality there's not very much they can do. Would you pay more for a potato of lessor quality just because it's a domestically grown product? Neither would the average Panamanian shopper. They want a better product at a lower cost, and that's the whole idea of free trade. Panamanian farmers should grow stuff that can't be produced in the United States, ship it there, and make twice as much money as they are now. But fighting like hell to keep doing what you've always done after the rules have changed is just dumb. And, it's not like they didn't know this was coming.

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Panama annual inflation eases to 2-year low in November

Money MattersPanama's annual inflation rate eased to its slowest in two years as transportation costs fell o n declining fuel prices, the government statistics agency said on Thursday.

In the 12-month period through November, the consumer price index rose 4.5 percent, slowing from the 5.3 percent increase notched in the year through October. November's annual inflation rate was the lowest since November 2010 when it clocked in at 4.3 percent.

In the month of November alone, the CPI rose 0.1 percent, on par with October's monthly rise.

Checking inflation in November was a 2.2 percent drop in transit costs as gasoline prices fell, the statistics institute said. That helped offset price rises in other sectors, such as food and beverages, which rose 1 percent and in utilities, which rose 0.6 percent.

Rapid growth in Panama's dollarized economy and massive public infrastructure spending, including a $5.25 billion expansion of the Panama Canal, have fed inflationary pressures.

The annual inflation rate has been declining since August, when it was 6.1 percent.

The government has projected 6 percent inflation for 2012. (Reuters)

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IMF - International Monetary Fund : Panama: IMF Concludes 2012 Article IV Mission

Money MattersAn International Monetary Fund (IMF) mission, headed by Corinne Deléchat, visited Panama between November 6-16 to conduct the country's annual Article IV consultation.1 At the end of the discussions, Ms. Deléchat issued the following statement in Panama City:

"Panama's growth performance continues to exceed expectations, buoyed by the Panama Canal expansion and large public infrastructure projects. Annual real Gross Domestic Product (GDP) growth averaged about 9 percent over the past five years, the highest in Latin America. Panama's financial sector is solid; banks remain well-capitalized, liquid and profitable. Recent and upcoming Free-Trade Agreements (FTAs) should help sustain foreign direct investment flows once public investment spending starts to unwind. The mission welcomes the creation of the Panama Savings Fund, which will further strengthen the economy's resilience to external shocks.over the medium term.

"The near-term outlook is favorable. Real GDP growth could exceed 9˝ percent in 2012. Easy credit and fiscal conditions should support public and private consumption through 2013. Headline and core inflation have started to decline thanks to a moderation in world food prices, but domestic demand pressures should keep average inflation at about 5˝-6 percent in 2012-13.

"In this context, the near-term fiscal policy challenge is to preserve fiscal space and avoid overheating. With the economy growing above capacity, further fiscal stimulus should be avoided, by keeping fiscal deficits below the revised Social and Fiscal Responsibility Law (SFRL) ceilings. A more neutral fiscal stance would help contain inflation and reduce public debt faster.

"At the same time, the global economy remains weak, and downside risks have intensified. Panama's trade and financial openness increases the country's vulnerability to external shocks, though strong domestic fundamentals would mitigate their impact. Nonetheless, a decline in U.S. output and international financial markets turmoil associated with the "fiscal cliff" could have a significant impact on Panama, through both trade and financial channels. Low direct trade and financial linkages with Europe would minimize the direct impact of a worsening of the European debt crisis.

"Ongoing efforts to upgrade financial sector supervision including by strengthening the capacity to monitor systemic risks and to enhance the financial safety net in line with best international practices are welcome and should be accelerated. While the banking system is healthy, strong credit growth, particularly in commercial real estate, tourism, and the Colón Free zone should be closely monitored, together with rising household and corporate leverage.

"Medium-term discussions focused on structural policies to ensure a smooth transition to sustainable growth once the public investment projects are completed. Ensuring that public investment is of high quality and complements private investment will require improvements to budget planning, accounting, and monitoring to enhance the effectiveness of public spending. Better targeting of subsidies and improvements in tax administration would help preserve social and capital expenditure within lower deficit limits.

"The mission welcomes recent improvements in the business environment. Efforts to address remaining bottlenecks in the logistics chain should continue to ensure that Panama can reap the full benefits of the FTAs and of the Canal expansion. The government's initiatives to improve the quality of public education and the availability of vocational training in partnership with the private sector should help develop the mix of skills required by a modern, service-based economy and raise living standards of all Panamanians."

Under Article IV of the IMF's Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country's economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board. At the conclusion of the discussion, the Managing Director, as Chairman of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country's authorities. (Press Release)

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USMEF: Panama FTA enhances opportunities for U.S. meat

Money Matters U.S. Meat Export Federation - Gerardo Rodriguez, U.S. Meat Export Federation (USMEF) director of trade development for Central America and the Dominican Republic, recently spoke to USMEF members about the potential benefits of the U.S.-Panama Trade Agreement, which entered into force Oct. 31.

The agreement grants duty-free access for high-quality (Choice and Prime) U.S. beef cuts. For all other beef muscle cuts, a 30 percent duty will be phased down to zero over the next 15 years. For beef variety meat, duties of 15 percent fall to zero immediately for some items, while others are phased down to zero over the next five years.

On the pork side, duties of 60 percent to 70 percent on most cuts will be eliminated through a duty-free tariff-rate quota (TRQ), which begins at 1,600 metric tons. Lower duties on bacon, cured hams and pre-packaged items will also be eliminated through duty-free TRQs. The volume of these TRQs increases annually for 15 years, when U.S. pork will effectively gain duty-free access to Panama.

Rodriguez explains that USMEF is ready to hit the ground running in Panama, thanks to behind-the-scenes groundwork that was done in anticipation of the trade agreement, which included identification of marketing opportunities and potential partnerships with importers and retailers.

Rodriguez notes that U.S. pork and beef have been achieving success in other parts of Central America for some time, thanks to CAFTA-DR – the Dominican Republic-Central America-United States Free Trade Agreement that was implemented several years ago (but did not include Panama). He says CAFTA-DR has been especially beneficial in developing strong markets for U.S. pork in Honduras and U.S. beef in Guatemala, and adds that some Guatemalan importers are also now helping expand the presence of U.S. beef in El Salvador.

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