Shipping and Transportation Equipment Sector

An Expert's View about Transportation and Storage in Panama

Posted on: 26 May 2012

The shipping and transportation equipment sector accounted for over $11 million in U.S. exports to Panama over 2008-10 (average).

The U.S.-Panama Trade Promotion Agreement Opportunities for the U.S. Shipping and Transportation Equipment Sector The U.S.-Panama Trade Promotion Agreement would provide signicant commercial opportunities for U.S. exporters: • The shipping and transportation equipment sector accounted for over $11 million in U.S. exports to Panama over 2008-10 (average). • Estimated duties paid on exports of U.S. shipping and transportation equipment to Panama from 2008 to 2010 were over $5 million. • Over 58 percent of U.S. exports of shipping and transportation equipment to Panama would receive duty-free treatment immediately upon implementation of the U.S.-Panama Trade Promotion Agreement. Shipping and Transportation Sector Overview U.S. Shipping and Transportation • The shipping and transportation equipment sector accounted for over $11 million in U.S. exports to Panama over 2008-10 Products Exports to Panama Averaged 1 (average). $11 Million • Top U.S. shipping and transportation equipment exports to Panama include trains, locomotive parts and transport containers. $20 • In 2009, U.S. production of shipping and transportation 2 $15 equipment products was over $48 billion. • The U.S. shipping and transportation sector employed over $10 3 155,000 workers in 2009. $5 $0 Improved Market Access for U.S. Shipping and 2008 2009 2010 Transportation Exporters to Panama • Panama’s shipping and transportation equipment taris average 13.5 percent, ranging from 0 to 15 percent. ? ver ? ? ? o? U.S. Shipping and • Over 58 percent of U.S. shipping and transportation equipment 4 exports to Panama would receive duty-free treatment Transportation Exports to Panama immediately upon implementation of this Agreement. ? ould ? e Dut? ? ? ree Immediatel? • Taris on the remaining 41 percent would be eliminated in 5 to 10 years. 38.83% Immediate 58.60% Key States Exporting to Panama 5 Years • Top U.S. states exporting shipping and transportation equipment 10 Years to Panama include: Florida, Georgia, Illinois, North Carolina, and Texas. 2.58% 1 Global Trade Atlas. Calculation based on import data as reported by Panama. The denition for shipping and transportation equipment used in this report, unless otherwise cited, is based on HS chapters 86 and 89. 2 U.S. Department of Commerce, U.S. Census Bureau, within NAICS 333 and 336. Shipments used as best proxy for production. 3 U.S. Department of Labor, Bureau of Labor Statistics, within NAICS 336. 4 Data based on three-year average for 2008 to 2010. In Mllions USD Foreign Competition in Panama’s Market • Since the conclusion of negotiations with the United States, EU Shipping and Transportation Panama has concluded separate negotiations with Canada and Equipment Exporters Could the EU. The EU-Central America Association Agreement which includes Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua Immediately Get a 11 Percentage and Panama successfully completed negotiations in May 2010. Point Tari Advantage in Panama This agreement will provide the EU with increased regional 14% opportunities in Central America through lower taris, increased 12% government procurement market access and elimination of 10% certain non-tari barriers. Panama also concluded free trade 8% agreement negotiations with Canada in May 2010. As part of 6% this agreement, Panama will eliminate taris immediately on 90 4% percent of Canada’s exports. 2% 0% • EU shipping and transportation equipment exporters will Current Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 immediately enjoy an average tari of 2.5 percent upon EU MFN-If U.S.-Panama Agreement is not enacted implementation of the EU-Central America Association Agreement, while U.S. exporters will face an average MFN tari of 13.5 percent until implementation of the U.S.-Panama Trade Promotion Agreement. Other Key Commitments by Panama for the Shipping and Transporation Equipment Sector Remanufactured Goods: Currently, remanufactured equipment could be treated as a “used good” and face possible import prohibitions and restrictions in Panama. Upon entry into force of the Agreement, U.S. remanufacturers of many products, such as engines, radiators, and alternators for construction equipment and transportation machinery, will gain access to export their remanufactured products to Panama without being unjustied prohibitions and restrictions. Investment: The U.S.-Panama TPA establishes a strong and predictable legal framework for U.S. investors for all forms of investment. Under the Agreement, Panama will provide U.S. investors substantive protections and due process rights that are consistent with U.S. legal principles and practice. The Agreement establishes an impartial dispute settlement mechanism for investors to pursue damages for breaches of these protections. Government Procurement: The U.S.-Panama TPA government procurement provisions guarantee non-discriminatory access for U.S. goods, services, and suppliers to a broad range of public sector entities in Panama. The Agreement covers purchases of Panamanian central government entities, including all key ministries, and signicant government enterprises. In addition to the $5.25 billion Panama Canal expansion project, the Government of Panama has identied almost $10 billion in other signicant infrastructure projects. The U.S.-Panama TPA also claries that build-operate-transfer contracts (BOTs) are within the scope of the government procurement obligations in the Agreement. Average Tari May 2011 The International Trade Administration - Your Global Business Partner The International Trade Administration (ITA) – a division of the U.S. Department of Commerce – strengthens the competitiveness of U.S. industry, promotes trade and investment, and ensures fair trade through the rigorous enforcement of our trade laws and agreements. ITA also utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. For more information on exporting to Panama, please contact: • The ITA office of the U.S. Embassy in Panama at enrique.tellez@trade.gov, or 011-507-317-5000, or by visiting our website http://www.export.gov/panama. • You can also locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://www.export.gov/eac. For more information on the U.S.-Panama Trade Promotion Agreement, please visit www.export.gov/fta/panama and www.trade.gov/fta/panama. For more information on industry-specific issues, please visit http://trade.gov/mas/index.asp.
Posted: 26 May 2012

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