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  • Essay / The Panama Colon Free Zone - 1416

    The Panama Colon Free Zone, considered the second most astronomically huge free zone in the world, dedicated to the re-export of a wide variety of goods to Latin America and The Caribbean has grown considerably in recent years, contributing greatly to Panama's economy. Panama's free trade zone has been the basis of the country's economic policy for many years. Free trade zones promote intense economic growth in a certain area by creating a liberalized trade regime. Panama has seen its revenues increase by 20% per year thanks to the Colon free zone, which generates more than two billion dollars each year. The Colon Free Zone contributes 7.4% to Panama's total GDP; generating approximately 27,347 permanent jobs. (Economy Watch) A free zone attracts international investors because these zones are tax-free for investors and traders. Additionally, it will promote domestic competition elsewhere in the country. Additionally, free trade increases business activity because it allows products and services to export their products all over the world. Let's start with the very recent event, which made the headlines in many newspapers, namely the breakdown of relations between Panama and Venezuela. The Free Zone maintains a clear operation to manage the business. In 1934, the merged states spawned the Colon Free Trade Zone. Dr. Thomas E. Lyons wanted to accelerate and encourage foreign trade and the creation of a free trade zone was the solution. A free trade zone is an area that eliminates traditional trade barriers, such as customs duties, and minimizes regulations related to administrative procedures. The mitigation of customs duties and taxes is designed to reduce the costs of operations engaged in international trade and thereby reduce the unprotected coastline of its oceans. These elements have made Panama an ideal location for illicit drug trafficking, as it offers numerous opportunities for traffickers to transport substances. While drug trafficking poses a considerable dilemma for the country and especially for the regime of the poor, this illicit trade represents opportunities. In the northeastern part of Panama there remains a comarc called Gunayala. The Guna people do not grow or process drugs, but they use their islands and territories as an opportunity. These lands from which they benefit, they have used as a place of obsession and escape from the Panamanian police. This area located in the northeast of Panama has become a drug trafficking region, preoccupying the eyes of ascendant entities. About twenty years ago, this area became a component of the Central American drug circuit...