Presidents Mulino and Arévalo Promise Legal Security and Collaboration with Companies
The presidents of Panama and Guatemala, José Raúl Mulino and Bernardo Arévalo, took advantage of their recent visit to the U.S. for the UN General Assembly to hold economic and business meetings and emphasize their commitment to improving the legal framework to attract more Spanish and international capital. Both leaders called for confidence in their countries as safe destinations for foreign investment under more favorable business regulations.
Mulino reaffirmed the new Panamanian government’s commitment to creating a country with clear rules and no corruption to attract and encourage investment. “We highly respect contractual freedom with investors coming to Panama through tenders, contracts, or concessions. However, what is fundamental is that the rules of the game are clear and that there is certainty in the rule of law,” he stated, emphasizing that his government is “pro-private enterprise. I come from there and have no reason to hide my origins.”
The president, who aims to promote public-private partnerships, recalled some of the significant foreign investment projects currently underway or projected by his government in Panama, such as the construction of the third line of the Metro in the capital, which will include a tunnel under the Panama Canal, the expansion of the second line, important works related to drinking water infrastructure, and the construction of a railway similar to Mexico’s “Tren Maya,” a flagship project of his administration.
Since taking office in July, Mulino has promised a broad package of infrastructure investment projects that interest Spanish firms, which are already involved in some of the most emblematic works executed in the country.
Notable Spanish Presence
Spain is the leading EU investor and the third-largest global investor in Panama, the Central American country with the highest presence of Spanish firms. Around 400 companies operate there, particularly in infrastructure, renewable energy, and tourism. FCC executed Line 2 of the Metro after constructing Line 1, and Sacyr participated in the expansion of the Canal, another significant project carried out in recent years with Spanish involvement. Other Spanish companies in Panama include OHLA, Acciona, Grupo Puentes, ACS, Naturgy, Indra, Mapfre, Meliá, Barceló, NH, Riu, Evenia, Ayesa, Iberia, Abanca, Air Europa, Duro, San José, Copisa, Ortiz, Iberdrola, Elecnor, Ecoener, Cox Energy, Inelsa, and Avanzalia. Telefónica sold its subsidiary there in 2019.
For his part, Guatemalan President Bernardo Arévalo invited foreign companies to invest more in his country. “To achieve the change we need, we must generate economic momentum through public funds and support from private capital. We need companies to invest and create jobs in the country,” he emphasized before Spanish and other foreign businesspeople.
Public-Private Partnerships
After encouraging foreign companies to increase their presence in Guatemala, Arévalo called for a united effort between the public and private sectors. “Together, we will build a country where opportunities and benefits are for everyone, where macroeconomic and fiscal stability are the starting point, as they create the conditions to advance in generating more and better jobs and inclusive growth.”
Meanwhile, the country’s Minister of Finance, Jonathan Menkos, pointed out, “Guatemala is the largest economy in Central America, and growth remains robust.” He highlighted that the new administration is working on institutional reforms, including implementing regulations to simplify administrative requirements and procedures and modifying the frameworks for public-private partnerships.
Arévalo, who took office in January, announced several months ago a growing investment in support programs for agriculture, tourism, and improvements to various infrastructures, which “will generate” numerous collaboration opportunities through public-private partnerships for Spanish firms. Spain is the leading investor and primary European trading partner in Guatemala, with investments exceeding 1.5 billion euros, and is the fifth-largest global investor in the country, where around 100 Spanish companies operate.
Spanish companies have made investments in Guatemala in strategic sectors such as telecommunications, energy, and agro-industry in a country that presents interesting opportunities in water, infrastructure, agri-food, chemical-pharmaceutical, automotive parts, and creative industries, along with a favorable position as a logistics hub and a site for nearshoring.
Spanish companies active in Guatemala include Santander, FCC, Naturgy, Mapfre, Abantia, Atento, Prosegur, Barceló, Rianxeira, Pescanova, Elecnor, Cox Energy, Faes Farma, Ufinet, Adolfo Domínguez, Mango, Inditex, and Iberia. Moreover, Guatemala is the Latin American country with the most Spanish franchises, totaling 41, including Telepizza and 100 Montaditos, as well as Zara, Stradivarius, Pull & Bear, Bershka, Equivalenza, and Tous.
Conclusion
In conclusion, the recent efforts of Panama and Guatemala to attract more Spanish and international investment highlight their commitment to creating a stable and transparent business environment. Both presidents, José Raúl Mulino and Bernardo Arévalo, have expressed a shared vision of fostering public-private partnerships, enhancing infrastructure, and simplifying regulations to boost foreign capital inflow. With Spain already playing a prominent role in the economies of both countries, the emphasis on collaboration and economic development presents ample opportunities for Spanish companies and international investors alike to contribute to and benefit from the growth of these Central American markets. The strategic sectors of infrastructure, energy, tourism, and agriculture, combined with strong macroeconomic foundations, further solidify Panama and Guatemala as attractive destinations for global investment.