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MIAMI - Following a meeting today with President Mireya Moscoso
and Trade Minister Joaquín Jácome of Panama, U.S. Trade Representative Robert B.
Zoellick formally notified Congress, on behalf of President Bush, of the Administration's
intent to initiate negotiations for a free trade agreement (FTA) with the Republic of Panama.
Zoellick said the Administration expects to launch negotiations during the second
quarter of 2004. Zoellick and trade ministers from 34 countries from throughout the Americas
are gathering in Miami this week for a meeting of ministers of the Free Trade Area of the
"This step is a vote of confidence in Panama," Zoellick said.
"Panama recovered its democracy some ten years ago, is managing effectively the Panama
Canal, and is looking toward the future -- and the United States wants to help Panama
"Panama serves as an important financial and commercial crossroads
in the Western Hemisphere and has one of the most open economies in the region,"
Zoellick wrote in the letter to Congressional leaders announcing the intention to
negotiate the agreement. "U.S. firms play an important role in Panama's largely service-based
economy. An FTA will help foster economic growth and create higher paying jobs in the United
States by further reducing and eliminating remaining barriers to trade and
investment between Panama and the United States. Panama is also a reliable partner in the region,
working closely with us to advance our common values and objectives in the World Trade
Organization (WTO) and Free Trade Area of the Americas (FTAA) negotiations."
The United States and Panama have long maintained strong economic
ties. In 2002, bilateral trade between the United States and Panama totaled $1.7 billion.
U.S. exports accounted for $1.4 billion of that amount. Nearly half of Panama's total imports
come from the United States. In addition, the U.S. holds approximately $25 billion in
foreign direct investment in Panama, with investments in sectors ranging from finance, to
maritime, to energy.
In the past year, Panama has made significant progress in
resolving important bilateral trade and investment issues. Negotiating an FTA with Panama will further
our efforts to strengthen democracy and support for shared fundamental values
throughout the region. The agreement will not only enhance trade, but also promote respect
for internationally recognized worker rights, greater respect for the rule of law,
sustainable development, and accountable institutions of governance. Strong anti-corruption and
transparency requirements in the FTA will help combat corruption. An FTA with
Panama is the next logical step in responding to direction from the United States
Congress, as expressed in the Caribbean Basin Trade Partnership Act, to conclude comprehensive,
mutually advantageous trade agreements with Caribbean Basin countries.
Panama will also serve as an important next step in the
Administration's strategy of achieving hemispheric economic integration and dismantling trade barriers in
the hemisphere through competitive liberalization. An FTA with Panama will complement the
free trade agreement the United States expects to conclude shortly with five of
Panama's Central American neighbors, which the Administration plans to broaden next year to
include the Dominican Republic. Negotiations with Panama will also support efforts
conclude an ambitious FTAA.
For further reference, please review the copy of the letter to Congress.