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PIMM:
a global hub
T
he completion of Panama’s famous canal in
1914 unlocked a gateway between the Atlantic
and Pacific oceans, cementing the country’s
position as the fulcrum linking North and
South America. Nearly 100 years later, Panama’s strate-
gic importance remains immense. Evidence of a boom
can be seen throughout Panama City, where construction
projects dominate the skyline, new cars flood the streets
and shopping arcades are bustling with activity.
The country is now positioning itself as a regional logistics
and services hub, backed by a strong offshore finance industry,
shipping registry and manufacturing base. A services-based
economy is flourishing and forecasts have predicted 11%
growth this year. In its latest World Economic Outlook, the
IMF singles out Panama as Latin America’s leading economy
in terms of GDP growth.
Since Martin Torrijos triumphed in Presidential elections
in May 2004, the administration has placed greater emphasis
on attracting FDI, which more than doubled in 2006 and is
now worth 16% of GDP. In addition he has negotiated a free
trade agreement with the US which should open the door to
increased commerce throughout the Western Hemisphere.
“Panama is a country which offers great opportunities,
not just for its residents but also for investors. Due to our
artist’s impression of PIMM
geographic location, we are a country that contributes
significantly to the development of international trade,”
says Torrijos.
A number of flagship projects are underway to rein-
force Panama’s position as a leading player in manufac-
turing, trade and logistics. The canal is being expanded
in a $5.2 billion project that will dramatically increase
capacity. Hong Kong-based Hutchinson Whampoa is
planning to turn Balboa, the administrative headquarters
at the entrance of the canal, into the largest port in Latin
America, and a competing mega-port project is under-
way on the Pacific coast.
ALREADY A HUB FOR TRADE
AND COMMERCE
Since 14,000 ships already pass through the Panama
Canal annually, carrying in excess of 200 million tons of “Panama is a country
cargo, it comes as no surprise that Panama already boasts
one of the largest Free Trade Zones in the world. Opened
which offers great
by the government in 1954, the Colon Free Trade Zone is
home to over 3,000 companies and revenues of $14 billion
opportunities, not
last year are indicative of vibrant commercial activity. just for its residents
But when Reynald Henry Katz, an experienced
entrepreneur, visited the Free Trade Zone in search of but also for investors”
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THE MAN WITH THE VISION

Reynald Katz is a serial entrepreneur. The son
of a French cosmetics manufacturer, he earned
$100,000 as a child selling his own hand-made
jewellery – money which he invested to co-found
a nail polish company in London at the age of 19.
Four years later this company was bought out by
ICI for $8 million. During his career he has worked
extensively in the cosmetics industry throughout
the world from Europe and the Middle East, to the
US and Asia. He manufactured his own cosmetics
range in Florida and later sold his company to a
major US firm. As a senior advisor to the Ministry
of Internal Trade in China he helped the govern-
ment establish malls in China. During the internet
boom, Katz developed the first internet duty free e-
commerce business – a project that stalled when the
internet bubble burst. Arriving in Panama in 2001,
Katz purchased a liquor distribution company in
the Colon Free Zone. He has since developed his
own liquor brands which currently have significant
market share in the Latin America market. He is
fluent in English, Spanish, French, Italian, Arabic
and Mandarin.

a showroom he was informed that Colon was running
at full showrooms capacity and that he was in line with
2,500 other companies also looking for showroom
space. Sensing a unique opportunity, Katz decided to
implement his own solution – a $750 million project
designed to create the perfect environment for buying
and selling goods.
PANAMA INTERNATIONAL MERCHANDISE
MART (PIMM)
Katz’s dream is to build Latin America’s first whole-
sale merchandise mart, called Panama International
Merchandise Mart (PIMM) on a 1,800 acre plot close to
Lake Gatun and city of Colon. The concept is to centralise
the region’s wholesale goods businesses by consolidating
manufacturers, vendors, exporters, distributors and sales
agents in one state-of-the-art space. PIMM is revolution-
ising the region’s commercial landscape giving importers
and exporters alike direct access to global markets.
He reasons that Panama already offers numerous
competitive advantages. Geographically, Panama has
direct access to 561 million people in Latin America. The
canal has secured the country’s position as a global trading
hub and Katz knows firsthand that demand for showroom
space is already high.
“Panama has always been a meeting point for busi-
ness,” says Katz. “The tax regime means it is an inexpensive
place to do business – there are no import duties, no sales
tax and no tax on profits. The currency is the US dollar
and inflation is very low. Geographically, Panama is in the
perfect position and 80 flights daily give direct access to
the US, Latin America, Europe and the Caribbean.”
AN INTEGRATED WHOLESALE UNIVERSE
His mission is to create a fully integrated “wholesale
universe.” The scale and scope of the project is unprec-
edented in the region and when complete, will be the
largest wholesale market in Latin America, featuring
thirty-four 25,000 m2 buildings with 6,800 showrooms,
as well as housing ten apartment blocks, ten commercial
office buildings, four hotels and a convention centre. The
development, built in less than 2 years, will resemble a
small city, complete with banks, residential apartments,
restaurants, an infirmary and blanket wireless cover-
age. The heart of the development is the construction
of showroom space that will enable thousands of manu-
facturers, gathered under one roof, to attract buyers and
distributers from around the world.
The response from manufacturers, companies looking
Geographically, Panama
for strategic partners and investors has been enthusiastic. is in the perfect position
The entire stock of 800 showrooms to be constructed in
Phase I were presold within 3 months to clients from and 80 flights daily give
Asia, the US and Europe, raising $130 million. “From
the beginning our sales have been in excess of $1 million
direct access to the US,
a day. This demonstrated to me that investors already Latin America, Europe
understood that PIMM represented a great business
opportunity,” says Katz. and the Caribbean
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In fact, uptake was so strong that construction of

Phase II, III and IV was accelerated and now 6,800 show-
rooms will be available by 2009.
A critical component of Katz’s vision is to enhance
previous models for merchandise marts. “We are sparing
no expense to create an environment where relation-
ships are formed and orders placed. We need to ensure
that everything is in place to facilitate buyers and sellers
working together as productively and efficiently as possi-
ble. We have the facilities to host merchandise shows and
trade events, all with the express aim of increasing the
volume of trade for our international wholesalers. Being
at PIMM gives buyers and wholesalers the opportunity to
see goods, trends and fashions six months ahead of the
market. We are providing suppliers a world of goods in
one location.”

PIMM GUARANTEES ACCESS TO THE LATIN

AMERICAN & CARIBBEAN MARKETS
PIMM provides companies of any size, from multi-
nationals to SMEs, easy access to the burgeoning Latin
American market by offering manufacturers the oppor-
tunity to set up a cost-effective presence in the region and
develop direct relationships with buyers.
In practice the operation is very simple. For example,
any European manufacturer keen to access the Latin
American market contacts PIMM and buys a perma-
nent showroom. Wholesalers from Brazil can contact the PIMM: the facts
manufacturer directly at their PIMM showroom. Deals
LOCATION Colon Province, Panama. Close to the second largest freezone in the
can be signed, orders placed and merchandise shipped
world and the Panama Canal
immediately from Europe to the customer in Brazil with
a quick phone call. OPENING 2009
A number of prestigious global brands have already
THE PROJECT 6,800 showrooms into 34 buildings on 1,300 acres making pimm the
expressed an interest in PIMM, including Philips,
largest commercial structure in Latin America with 2 million square
Siemens, ICI, Peugeot, Renault, Fiat, Mercedes, Kraft
metres under construction
Foods, Gucci, Chanel, Rolex, Prada, Zara, Versace,
Benetton and Hermes. FACILITIES &
Among the services that PIMM will provide are a AMENITIES 10,000 seat convention centre, international business centre,
legal team to help incorporate companies, procure inves- 10 office blocks, 10 residential apartment blocks, 4 hotels, 10
tor visas and open bank accounts. Trade specialists are restaurants, heliport, 5,000 parking spaces, free shuttle buses, 24
on hand to help navigate international requirements, hour security, blanket wireless coverage, police station, fire station,
trade financing, customs regulations, freight forward- supermarkets, medical centre, gym, recreational facilities
ing and showroom setup. Local experts will help with
EMPLOYMENT 30,000 jobs projected making PIMM Panama’s largest single
logistical and practical matters such as finding appro-
employer
priate schooling for kids, securing apartments and even
leasing cars. The objective is to facilitate a quick start ECONOMIC IMPACT 7,000 showrooms each with an estimated annual turnover of
up, so that manufacturers are exhibiting, meeting buyers $2,000,000
and selling as quickly as possible. “What is in our custom-
LANGUAGES Spanish and English universally spoken
ers’ best interests is in our best interest. If they succeed,
we succeed.”
The benefits to the local economy are projected to
be considerable. In terms of employment, the project is bringing $500 million a year of indirect investment. But GLOBAL AMBITIONS
expected to create in excess of 30,000 jobs. It is estimated the most important thing to bear in mind is that everyone Ultimately, Katz believes that the concept is export-
that the PIMM project in all its phases will add a total of who opens a showroom in PIMM will get their money able and has ambitions to build a global brand based on
more than $400 million to the economy of Panama with back within 2-3 years because PIMM guarantees business the same concept as PIMM. “We are exploring the possi-
annual revenues of $87 million a year for the next five success. We are investing $1 million a month on chartered bility of an IPO in the future. We would like to raise $10
years to the Colon province. flights which we give free of charge to buyers just so that billion and use the capital to enter new markets like South
According to Katz: “One of the key aspects when they will buy at PIMM. When someone buys a showroom Africa, India, China, Russia and even New York.” He esti-
considering PIMM’s economic impact on Panama is that at PIMM they are not just getting a piece of real estate, mates that the cost of setting up an operation in each new
an estimated 6,000 people will be visiting PIMM daily, they are buying a means of doing business.” jurisdiction would be around one billion dollars.