In the News from Panama

China and Panama Negotiating New Trade Agreement

Five months after formally launching diplomatic ties, China and Panama are negotiating a new trade agreement that could provide a big boost to Panama’s economy and real estate market.

Panamanian President Juan Carlos Varela said he expects to sign 15 to 20 agreements with Chinese President Xi Jinping when he visits China in November to formally launch discussions. Varela says representatives of different business sectors will accompany him on the trip and will begin discussing a wide range of ways the two countries can better cooperate.

“We are already negotiating (the FTA) we expect that on our next visit we will sign an intention to negotiate the free trade agreement,” Varela said. “We are very optimistic of this trip since a great Chinese interest has been raised by this diplomatic relation with Panama.”

Learn what every Panama real estate investor needs to know 

Subscribe to our weekly newsletter 

In particular, Varela is hoping that China will help finance more energy and infrastructure projects. Among other deals, China will be working with Panama on new hydroelectric projects in the future, Panamanian Finance Minister Augusto Arosemena told Reuters.

Panama is also working to bring direct flights from China, which should have a direct impact on both tourism and the property market. Wealthy Chinese have been active investors in real estate around the world.

As we discussed a few months ago, the China relationship should have far-ranging implications for both Panama’s economy and the real estate market. Chinese are long-term players and they tend to look for solid, stable investments in countries where they have strong ties.

In addition to an embassy in Beijing, Varela said Panama will be opening a consulate in Shanghai and has taken steps to open a consulate in Guangzhou, as well.

Jeff Barton is managing director of Punta Pacifica Realty, the top sales and property management company in the waterfront skyscraper community of Punta Pacifica.