QUICK TAKES

Panama Aggressively Seeks Trade Partners for its
Non-Traditional Exports

By Juan Carlos Martinez

In its aggressive trade strategy Panama is now wooing the EFTA in order to formalize its trade relationship through a Free Trade Agreement. EFTA is the European Free Trade Association whose members are Iceland, Norway, Liechtenstein and Switzerland.

The first week of December the Panama Ministry of Commerce and Industry indicated that through its International Business Negotiations Office it had started exploratory conversations with the countries belonging to the EFTA so that they can exchange technical information and explore ways to finally reach a Free Trade Agreement.

Panama is currently EFTA´s biggest trade partner in Central America and the Caribbean. For Panama a FTC with EFTA´s member countries would mean access to four markets with a combined GDP of more than $950 billion and where the combinedaverage per capita income is above $35,000.00

Should Panama be able to sign a Free Trade Agreement with EFTA it would report immediate benefits to Panama's burgeoning non-traditional export industry. Non-traditional exports have different definitions but in Panama they include many tropical fruits which grow plentifully in this country however most of them are not pursued as profitable crops.

Papaya

Among some of the fruits which are qualified as non-traditional exports in Panama that are actually cultivated for export are pineapples, watermelons and melons with 2,987 hectares, 1,795 hectares and 980 hectares respectively. Panama due to its wonderful tropical climate has the possibilities of growing many more types of fruits that would trade at a premium price in northern markets such as Europe. Some of these fruits. which grow wild in Panama, are guayabass, passion fruit, avocado, mamey sapote, tamarind, papaya, among many others.

The Panamanian market is very small for this type of fruit. Panamanians prefer to eat imported fruits such as apples and pears so any organized effort to cultivate these fruits as profitable crops would have to be aimed at the export market specifically United States, Canada and Europe.

A clear example of this is the fact that cacao crops have been able to reach the Swiss market. Cacao is the seed from which chocolate is made and the climate in Panama is perfect for that it. Currently the cooperative of Ngobe Bugle Indians in Bocas del Toro that cultivates cacao for the Swiss market exports 100 thousand pounds a month at $1.42 per pound.

This non-traditional agricultural industry is truly emerging, the models to make it work already exist and non-traditional exports benefit from government incentives in many cases. It is an interesting niche, well worth exploring for anyone with an agricultural bent.

Passion Fruit

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