WORLD TRADE  
ORGANIZATION  G/SCM/N/177/PAN/Rev.1
20 July 2009 
 
 (09-3547) 
Committee on Subsidies and 
Countervailing Measures Original:   Spanish 
 
 
 
SUBSIDIES 
 
Continuation of Extension under SCM Article 27.4 of the Transition Period for the  
Elimination of Export Subsidies Pursuant to the Procedures Contained in the  
General Council Decision in Document WT/L/691  
 
PANAMA 
 
Revision  
 
  The following communication, dated 6 July 2009,  is being circulated at the request of the 
delegation of Panama.  
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  The Republic of Panama hereby submits the following notification pursuant to 
subparagraph 1(d) and paragraphs 3 and 4 of the Pr ocedures for extensions under Article 27.4 of the 
SCM Agreement for certain developing country Members (G/SCM/39), subparagraph 1(c) and 
paragraphs 2 and 3 of the Decision adoptin g procedures for the continuation of such 
extensions (WT/L/691), and the Decisions of  22 November 2002 on Export Processing Zones 
(G/SCM/85) and on the Official Industry Register (G/SCM/84).   In accordance with its rights and obligati ons under the procedures for extending programmes 
that comprise subsidies classified as prohibited unde r Article 3.1 of the Agreement on Subsidies and 
Countervailing Measures (SCM) of the World Trade Or ganization (WTO), the Republic of Panama is 
submitting for the Committee's consideration the following notification in order to meet its 
obligations in respect of the extension of the tr ansition period for programmes subject to renewal. 
  Panama confirms that its programmes subject  to extension comply with the standstill, 
favourability and transparency requirements under the procedures for extensions (G/SCM/39) and the 
General Council Decision (WT/L/691) in that neither pr ogramme has been modified  so as to make it 
more favourable than it was at 1 September 2001. G/SCM/N/177/PAN/Rev.1 
Page 2  
 
  - Programmes  
 
I. EXPORT PROCESSING ZONES 
1. Description of the Programme 
 See paragraph II.1 of document G/SCM/N/95/PAN. 
 
2. Period of notification 
 2007 
 
3. Objective of the programme 
 See paragraph II.3 of document G/SCM/N/95/PAN. 
 
4. Background and authority 
 See paragraph B.4 of document G/SCM/N/71/PAN. 
 5. Form of the subsidy 
 See paragraph II.5 of document G/SCM/N/95/PAN. 
 
6. Beneficiaries and mechanism 
 See paragraph II.6 of document G/SCM/ N/95/PAN and paragraph I.6 of document 
G/SCM/N/160/PAN. 
 
7. Estimated amount of the subsidy 
 No estimate available.  However, paragr aph I.9 provides updated information, which 
represents an attempt to establish an or der of magnitude under the EPZ programme. 
 8. Duration of the subsidy 
 Not specified in Law No. 25 of 1992.  G/SCM/N/177/PAN/Rev.1 
 Page 3 
 
 
  9. Statistical data permitting an assessment of the trade effects of the subsidy 
Table No. 1.  PANAMA:  VALUE OF EXPORTS FROM 
PROCESSING ZONES 
2001-2007 
Year No. of enterprises f.o.b. value (US$ million) 
2001 57 51.9 
2002 68 52.4 
2003 74 67.2 
2004 45 69.2 
2005 56 77.8 
2006 61 88.2 
2007 77 88.5 
Source : Auditor-General of the Republic and Vice-Ministry of Foreign Trade of the Ministry of Trade and Industry. 
 
 
Table No. 2.  PANAMA:  EXISTING PROCESSING ZONES AND 
NUMBER OF ENTERPRISES REGISTERED 
APRIL 2008 
No. Processing zone No. of enterprises registered 
1 Panaexport, Ojo de Agua 21 
2 Proinexport 2 
3 Marpesca, S.A. 18 
4 Rail Road Export Processing Zone 1 
5 Zona Procesadora de Davis 9 
6 Colón Maritime Investor 3 
7 Eurofusión 1 
8 Schlobohm 2 
9 Telepuerto Panamá 3 
10 Isla Margarita Development 7 
11 Espanam Iberoamérica 0 
12 Zona Procesadora de Albrook 10 
13 Zona Procesadora de Chilibre 0 
14 Tocumen Export Processing Zone 0 
15 Proexport 0 
TOTAL  77 
Source : Vice-Ministry of Foreign Trade, Ministry of Trade and Industry. G/SCM/N/177/PAN/Rev.1 
Page 4  
 
  II. OFFICIAL INDUSTRY REGISTER 
1. Description of the subsidy 
 See paragraph III.1 of document G/SCM/N/95/PAN. 
 
2. Period of notification 
 2007 
 
3. Objective of the programme 
 See paragraph III.3 of document G/SCM/N/95/PAN. 
 4. Background and authority 
 See paragraph C.4 of document G/SCM/N/71/PAN.  See also Resolution No. 32 of 
31 December 2002 of the Ministry of Trade a nd Industry, notified in Annex 1 to document 
G/SCM/N/95/PAN.  5. Form of the subsidy 
 See paragraph III.5 of document G/SCM/N/95/PAN. 
 
6. Beneficiaries and mechanism 
 See paragraph III.6 of document G/SCM/N/95/ PAN.  In addition, the following table 
indicates the number of beneficiary enterprises in the Official Industry Register, according to type of 
activity. 
 
Table No. 3.  OFFICIAL INDUSTRY REGISTER:  NUMBER OF ENTERPRISES 
ACCORDING TO TYPE OF ACTIVITY/PRODUCT 
JUNE 2008 
No. Activity/Product No. of enterprises 
 TOTAL 169 
1 Animal feed 3 
2 Sugar cane 5 
3 Manufacture of clothing 5 
4 Poultry breeding 6 
5 Milk by-products 5 
6 Detergents and other chemical products 12 7 Manufacture of footwear 5 
8 Brewing of beer 2 
9 Manufacture of mattresses 3 
10 Manufacture of brooms and mops 3 
11 Manufacture of furniture 8 
12 Wood and wood articles 2 
13 Articles of aluminium and other metals 11  G/SCM/N/177/PAN/Rev.1 
 Page 5 
 
 
  Table No. 3.  OFFICIAL INDUSTRY REGISTER:  NUMBER OF ENTERPRISES 
ACCORDING TO TYPE OF ACTIVITY/PRODUCT 
JUNE 2008 
No. Activity/Product No. of enterprises 
14 Cement articles 1 
15 Paper and paperboard and articles thereof 16 
16 Coffee processing 4 
17 Processing of hides and skins 4 
18 Food products 31 
19 Marine products 17 
20 Pharmaceuticals 2 
21 Plastic products 11 
22 Printing 2 
23 Other products 11 
Note : Only covers enterprises listed in th e Official Industry Register as exporting all or part of their production. 
Source : Directorate-General of Industry of the Ministry of Trade and Industry. 
 
7. Estimated amount of the subsidy 
Table No. 4.  VALUE OF TAX INCENTIVES GRANTED UNDER 
THE OFFICIAL INDUSTRY REGISTER 
2005-2007 
(US$ million) 
Year Type of benefit 
2005 2006 2007 
Import tax exemption or rebate 14.1 18.9 22.7 
Income tax exemption or rebate for reinvestment 9.7 3.4 4.8 
Other incentives* 16.6 10.4 2.7 
Total 40.4 32.7 30.2 
* Exemption from income tax only. 
Source : Fiscal Studies Department, Direct orate-General of Revenue, Minist ry of the Economy and Finance. 
8. Duration of the subsidy 
 See paragraph III.8 of document G/SCM/N/95/PAN. 
 
9. Statistical data permitting an assessment of the trade effects of the subsidy 
 No statistical information is available to assess the trade effects of the programme. 
 
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