A host of recent announcements is bringing renewed focus to Colón, Panama.
One project, the recently renovated Enrique A. Jimenez Airport has received proposals for a flight school and hotel to open on the premises. The airport opened in 2013 after a US$58 million renovation, but has yet to receive a commercial flight. The airport lacks any stores or fuel on site.
Meanwhile, Panama’s Public Works Ministry announced that it is planning to build 40 kilometers of coastal roadway between Miguel de la Borda and Coclé del Norte in the province of Colón, including five bridges and eight storm drains.
And finally, after months of speculation, the government’s Cabinet Council has approved a law to present to the National Assembly to make the entire city of Colón a duty-free zone.
Extending the Colón Free Trade Zone’s boundaries to the entire city is not a new idea and was the aim of a law passed originally in 1992.
Surse Pierpoint, head of the Panama Freedom Foundation and recently appointed as general manager of the Colón Free Trade Zone by President Varela, has been vocal about extending the zone and its tax-free benefits to the rest of the city of Colón to help resuscitate the historic city.
But the expansion will need to take into account public sentiment, as similar announcements have been met with hostility in the past.
In October 2012, the government approved a controversial law allowing for the sale of state-owned land next to Colón’s free zone. In response, protests lasted for more than a week. Protesters were concerned that the sale and expansion of the zone’s industrial yards would displace nearby residents. The police crackdown was harsh, and three died in the commotion, including a 9-year-old boy. Days later, the government announced it would repeal the law.
The zone employs about 30,000 people. For a city with such rampant unemployment as Colón, these jobs are much needed. While many of the jobs in the zone have been described as “hunger-wage” positions, dockworkers recently obtained a recent 27% pay increase over the next four years.
2014 was a hard year for the zone (in part due to payment disputes with Venezuela, the zone’s largest partner), with a double-digit drop in volume and revenue as well as thousands of lost jobs.
The zone is the second largest free-trade zone in the world after Hong Kong.