The Latin Auto Parts Expo opened today at the ATLAPA Convention Center in Panama with nearly twice as many exhibitors as it had in its inaugural show last summer.
Several exhibitors who also attended last year’s show said the increase in exhibitors this year is influenced largely by Asian companies that want to establish their business in the Latin American market.
“The growth in booths this year is all from the Chinese market,” said Mandy Aguilar, regional vice president of the Parts House. “Panama is a very small market, but the business of Panama is its free-trade zone. Panama is very adept at handling exports. This makes for a large and healthy aftermarket for distributors and third-party logistics providers.”
The port city of Colon in Panama is the second largest free-trade zone in the world, according to Bobby Hines, international trade specialist for the U.S. Department of Commerce. Hines and John Coronado, a senior commercial officer at the U.S. Embassy in Panama, were working from the department’s booth at the show trying to get more business abroad for U.S. companies.
“The Panama Canal is the granddaddy that the free-trade zone grew from,” Coronado said. The city of Colon is at the end of the canal and a convenient dropping off point for goods that are moved from the Pacific Ocean through the canal.
“Panama is a relatively small country – only 4 million people – but it has a sophisticated distribution and logistics business due to the free-trade zone of Colon,” Coronado said. “It also has a growing air distribution business through Copa Airlines, which routes many flights through its headquarters in Panama City.” Copa operates more than 326 daily scheduled fights to 72 destinations in 30 countries.
“There are many free-trade zones in almost every country, but the size, shape and reach of the Colon free-trade zone is impressive,” Coronado said. “Companies realize this, which sets up distribution and logistics opportunities here.”
Aguilar, who is scheduled to speak at the show on Friday, agreed with Coronado.
“The canal has made this country rich and Panama is very adept at handling exports,” Aguilar said. “There are real opportunities for business in the free-trade zone.”
Just what makes a free-trade zone so attractive to business? Free-trade zones are geographic areas where goods may be sent, handled, manufactured or reconfigured, and re-exported without the having to pay custom duties, or import taxes. Only when the goods are moved to consumers within the country or to another country are they subject to custom duties.
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