WORLD TRADE  
ORGANIZATION  G/SCM/N/128/PAN 
4 July 2005 
 
 (05-2892) 
Committee on Subsidies and Countervailing Measures Original:   Spanish 
  
 
SUBSIDIES 
 
Extension under SCM Article 27.4 of the Transition Period for the
 
Elimination of Export Subsidies Pursuant to the Procedures  
in Document G/SCM/39  
 
Updating Notification  
 
PANAMA 
 
 
 The following communication, dated 29 June 2005,  is being circulated at the request of the 
delegation of Panama.  
_______________ 
  
 I have the honour to transmit herewith, on beha lf of the Government of the Republic of 
Panama, the following updating subsidy notification fo r 2004, pursuant to subparagraph 1(d) of the 
Procedures for extensions under Article 27.4 of th e SCM Agreement for certain developing country 
Members. G/SCM/N/128/PAN 
Page 2  
 
  The Republic of Panama is submitting the fo llowing notification pursuant to subparagraph 
1(d) and paragraphs 3 and 4 of the Procedures for extensions under Article 27. 4 for certain developing 
country Members (G/SCM/39) 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) in that 
none of these programmes has been modified so as to make it more favourable than it was at 
1 September 2001.  G/SCM/N/128/PAN 
 Page 3 
 
 
 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 
 2004 
 
3. Objective of the programme 
 See paragraph II.3 of document G/SCM/N/95/PAN. 
 
4. Background and authority 
 See paragraph II.4 of document G/SCM/N/95/PAN. 
 5. Form of 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. 
 7. Estimated amount of the subsidy 
 No estimate available. 
 
8. Duration of the subsidy 
 See paragraph II.8 of document G/SCM/N/95/PAN. 
 
9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
Table 1
 
 
PANAMA:  Value of Exports from the Processing Zones, 2001-2004  
 
Year No. of Enterprises F.O.B. Value 
(in US$ million) 
2000 48 26.0 
2001 57 51.9 
2002 68 52.4 
2003 74 67.2 
2004 45 69.2 
 
Source : Auditor-General of the Republic and National Direct orate of Foreign Trade Services, VICOMEX, MICI. G/SCM/N/128/PAN 
Page 4  
 
 Table 2
 
 
PANAMA:  Existing Processing Zones and Number of Enterprises Registered, 2004  
 
No. PROCESSING ZONE No. of Enterprises 
Registered 
1 Zona Procesadora PANEXPORT 18 
2 Zona Procesadora Marpesca, S.A. 4 
3 Zona Procesadora Estatal de Davis 6 
4 Zona Procesadora Isla Margarita 6 
5 Zona Procesadora de Albrook 5 
6 Telepuerto Panamá, S.A. 2 
7 Zona Procesadora Proinexport 2 
8 Zona Procesadora Schlobhom 2 
9 Tocumen Export Processing Zone 0 
10 Zona Espanam Iberoamérica 0 
 TOTAL 45 
 
Source : National Directorate of Foreign Trade Services, VICOMEX, MICI 
 
 
II. OFFICIAL INDUSTRY REGISTER 
1. Description of the subsidy 
 See paragraph III.1 of document G/SCM/N/95/PAN. 
 
2. Period of notification 
 2004 
 3. Objective of the programme 
 See paragraph III.3 of document G/SCM/N/95/PAN. 
 
4. Background and authority 
 See paragraph III.4 of document G/SCM/N/95/PAN. 
 5. Form of 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. 
 
7. Estimated amount of the subsidy  G/SCM/N/128/PAN 
 Page 5 
 
 
 Table 3  
 
Value of Tax Incentives Granted Under the Official Industry Register, 2002-2004  
(in US$ million)  
 
YEAR  TYPE OF BENEFIT  2002 2003 2004 
Import tax exemption or rebate 15.2 18.7 17.5 
Income tax exemption or rebate for reinvestment 11.5 8.7 11.6 
Other incentives* 6.9 9.8 10.7 
Total ……….  33.6 37.2 39.8 
 
 *Exemption from income tax only. 
Source : Fiscal Studies Department, Directorate-General of Revenue, Ministry 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 available to  assess the trade effects of the programme. 
  
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