Panama–United States Trade Promotion Agreement
The Panama–United States Trade Promotion Agreement (Spanish: Tratado de Libre Comercio entre Panamá y Estados Unidos or TLC) is a bilateral free trade agreement between Panama and the United States that has been in effect since October 2012. Stated objectives include eliminating obstacles to trade, consolidating access to goods and services and favoring private investment in and between both nations. Apart from commercial issues, it incorporates economic, institutional, intellectual-property, labor and environmental policies, among others.
The negotiations were officially completed on December 19, 2006, though elements were still to be renegotiated. The agreement was signed on 28 June 2007, and Panama's National Assembly ratified it on the following 11 July, before the twelve hundred page document had been translated into Spanish.
The treaty has been noted to be one of the main reasons for the 2012 changes to copyright law of Panama, changes which have attracted a number of criticism from the free culture and digital rights activists. The activists have criticized the U.S. government for giving in to the entertainment industry by putting pressure on Panama and other Latin American countries, forcing them to adopt what they see as less progressive copyright bills, infringing on free speech in detriment to the public interest.
On September 1, 2007, Pedro Miguel González Pinzón, who had been indicted by a U.S. grand jury for the murder of United States Army Sgt. Zak Hernández, was elected President of the National Assembly of Panama. Several members of the U.S. Congress stated that they would oppose the treaty while he held the post. González's appointment also caused controversy within Panama, particularly due to its threatening of the free trade pact. In one poll, most Panamanians stated that González should step down. However, González's backers stated that the U.S. opposition to his leadership was another chapter in a long history of American interference in Panamanian affairs, and rejected it as inappropriate. Former Panamanian President Guillermo Endara stated that he believed González to be guilty of the murder, though he opposed the trade agreement. President Martín Torrijos, a fellow PRD member who had negotiated the trade pact, made a private request for González to resign, but avoided publicly criticizing him. On March 7, 2008, it was announced that González would not seek reelection as head of the National Assembly when his term ended on August 31.
New concerns related to Panama's status as a so-called "tax haven" then needed to be addressed. In 2010, President Barack Obama's trade representative, Ron Kirk, negotiated a tax information exchange agreement with Panama that overcame these concerns. This tax agreement entered into force in April 2011, paving the way for congressional consideration of the TPA.
In the 112th U.S. Congress, the ascendancy of the Republican Party in the House of Representative led to new pressures to approve all three pending fast track free trade agreements (Colombia, Panama, and South Korea). Finally, in October 2011, President Obama submitted the three trade pacts to the Congress, and they were quickly passed. On October 12, 2011, the U.S.-Panama TPA was passed in the House by a vote of 300-129 (H.R. 3079) and in the Senate by a vote of 77-22 (S. 1643). President Obama signed the pact, but further regulatory formalities were needed before the agreement entered into force October 31, 2012.
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- U.S. Trade Representative's Summary of the Panama TPA
- Congressional Record entry for Oct. 12, 2011.
- U.S. International Trade Commission Report on U.S.-Panama TPA.
- U.S. Trade Representative's page on U.S.-Panama TPA.
- U.S. State Department Statement on Election of Pedro Miguel González Pinzón.
- The U.S.-Panama Free Trade Agreement Congressional Research Service.
- TradeRoots Fact Sheets