Panama president: PR’s potential vast

“Every country in Latin America wants to be like Puerto Rico. You have a Latin culture yet maintain the stability and security of your relationship with the United States,” Martinelli said after arriving on the island to deliver the keynote speech the Chamber of Commerce convention.

Martinelli said the island should boost its efforts to increase trade with Panama, especially in lieu of the Central American nation’s recently signed trade agreement with the U.S., which takes effect in October.

“International trade of goods and services is one of the key components to stimulating economic growth,” Martinelli said.

Panama’s international trade strength stems in large part from the Colón Free Trade Zone, the largest free trade zone in the Western Hemisphere. Last year the zone accounted for 92 percent of Panama’s exports and 64 percent of its imports, according to the United Nations Economic Commission for Latin America and the Caribbean.

The Panamanian economy, which had been plagued by unemployment rates as high as 14 percent a few years ago, is in the midst of a boom. It is the fourth fastest growing economy in the world right now according to the CIA World Factbook, with GDP growth of 10.6 percent in 2011; 7.6 percent in 2010; and 3.9 percent in 2009, when Martinelli took office.

The unemployment rate in Panama currently stands at 2.7 percent and there are more job openings available than people seeking work.

The per capita income in Panama is currently $13,600 according to the CIA World Factbook; in Puerto Rico it is currently $16,300, down from $18,100 in 2008. At the current rate, Panama will surpass Puerto Rico in per capita income within a few years.

Martinelli’s administration embarked on a $20 billion infrastructure investment program designed to enhance Panama’s role as a global logistics hub and increase foreign direct investment. He also lowered personal income taxes and signed various measures to stimulate entrepreneurship.

“Entrepreneurship is best served when there is transparency in business practices and the rules are clear,” said Martinelli, a businessman who chairs the boards of Panama’s Super 99 supermarket chains and of two other companies and sits on the boards of at least eight other firms.

Martinelli, who claimed he is not a good politician, said he is able to run the country like a business because he doesn’t have to worry about re-election. In Panama, presidents are elected to a single five-year term.

“Politicians by their nature tend to be overly cautious. My background is in business where one has to be more aggressive,” Martinelli said. “I have made some mistakes, but without risk there is no reward. And, the results of the success of the growth of the economy in Panama reflect this.”