The two countries, five years ago signed a bilateral Trade Promotion Agreement or TPA. This agreement entered into force October 31st.
The United States and Panama, seeking to boost their economies and improve trade between the two countries, five years ago signed a bilateral Trade Promotion Agreement or TPA. This agreement entered into force October 31st.
The United States already has free trade agreements with Canada, Mexico, Peru, Chile, Colombia, the Dominican Republic, and five Central American countries. Thus, the enactment of the agreement with Panama marks an "historic milestone, bringing us closer to our goal of an unbroken network of free trade agreements in the Western Hemisphere,” said Secretary of State Hillary Clinton in a statement.
“By eliminating tariffs and other barriers, the TPA will significantly liberalize trade in goods and services between our countries, enhancing competitiveness and supporting jobs. It’s an example of the Obama Administration’s commitment to economic statecraft and deepening our economic engagement throughout the world.
“Almost all U.S. exports of consumer and industrial products to Panama will now be duty-free with remaining tariffs phased out over ten years. Nearly half of all current trade will receive immediate duty-free treatment with most of the remaining tariffs eliminated within 15 years.
“This agreement will also preserve duty-free access for Panamanian goods previously granted under trade preference programs and help strengthen the Panamanian economy,” wrote Secretary Clinton.
Today, the United States is Panama’s largest trading partner and enjoys a 7.9 billion dollar trade surplus with Panama. Panama is one of the fastest growing economies in Latin America, with annual growth forecast between 5 and 8 percent through 2017. This comprehensive Agreement will eliminate tariffs and other barriers to U.S. exports, promote economic growth, and expand trade between our two countries. The newly enacted agreement is especially important in light of opportunities for U.S. companies to participate in the $10 billion of significant infrastructure projects identified by the Government of Panama in addition to the ongoing $5.3 billion expansion of the Panama Canal.
“Not only will this [agreement] reinforce the ties between our economies and create jobs, it secures our strategic partnership with a key partner,” wrote Secretary Clinton. “I want to thank President Martinelli for his leadership on the entry into force of the TPA and look forward to both countries fully realizing the promise of this agreement.”