Strong Regulatory Framework and PPPs, Key for a Regional Digital Hub

CAF—development bank of Latin America—and the National Competitiveness Center (CNC) held an online talk titled “Digital Infrastructure in Panama,” where representatives of the governments of Peru and Panama, private businesses and international experts in the telecommunications sector, discussed the nation’s progress and opportunities in digital transformation, information on the situation of telecommunications infrastructure, expansion of coverage and quality of services.

Lucía Meza, CAF representative in Panama, explained that public-private collaboration is essential, especially for the telecommunications sector, as the consolidation of Panama as a sophisticated logistics and digital service hub will have a positive impact throughout the region. “If Panama fares well in its path of development of digital services, the conditions of telecommunications will improve throughout the region.”

The digital age offers tools for economic recovery, and the efficiency of digital services can lay the foundations to advance economic growth in our countries, thus meeting the sustainable development goals that—even after the pandemic—further separate us from developed countries. In Meza’s view, closing the digital divide requires a plan involving governments, industries, society at large, as well as greater infrastructure, staff training, regulatory framework updating, and technological modernization, in order to boost productivity.

As part of CAF’s Digital Agenda, we have an observatory of Latin America’s digital ecosystem, we support government digital innovation, offer technical assistance and financing for telecommunications modernization and to promote the digital economy as key tools to achieve greater social and territorial cohesion in our countries, boost productivity, improve open data best practices for better transparency, as levers for sustained economic growth. In Panama we support these actions by assisting AIG, ANTAI, MEF, ITSE.

In addition, Irving Halman, chairman of the CNC, noted that studies conducted by the entity confirm that Panama’s growth has been losing pace over the past 13 years. To gather pace again, it is necessary to increase steadily the factors that contribute to economic growth, such as capital and productivity.

“We welcome and value the continuity that authorities have given to the “Digital Hub,” which relies on a high level of regional and global integration of our country, to promote the software industry and development, ICT services, underwater cable connectivity and the attraction of investment in infrastructure such as data centers,” said Halman.

The talk also featured José Alejandro Rojas, minister counsellor for the facilitation of Panama’s public investment and vice-president of the CNC, who stressed that the country is currently working on the Digital Hub strategy, by promoting structure, empowerment and joint work with the private sector.

Rojas stressed that the current government has a strategy to make Panama the epicenter of data movement in the region, by creating the “Panama Digital Hub”, aimed at encouraging private sector investment in technology and innovation hand in hand with an investment for public sector digitalization, including areas such as agribusiness, manufacturing, education and FinTech technology solutions, cybersecurity and artificial intelligence. He emphasized that President Laurentino Cortizo is committed to empowering the country as a Digital Hub, to incentivize entrepreneurship, create jobs, improve education and foster Panamanian talent, in order to close the inequality gap and achieve equitable and fair development for all.

In his remarks Raúl Katz, president of Telecom Advisory Service and professor at Columbia University’s business school, stressed that Panama is in an intermediate or transitional position in the development of digitalization in the context of developing countries, above nations such as South Africa, Peru and India and below countries such as Chile, Mexico and Costa Rica. Panama is boosting its digitalization, but it is still lagging behind some of the most advanced countries in Latin America.

As for digitalization, Katz noted that between 2004 and 2019, Panama has grown significantly in digital infrastructures, such as 4G communications networks, broadband, mobile and fixed broadband, quality of services. Similarly, this growth has been marked by the digitalization of households, i.e., the ability of Panamanian households to access the internet through broadband.

Katz highlighted that Panama’s goal as a country is to achieve an advanced economy. To that end, it should develop human capital, workforce, digital infrastructure, public policies, regulation, digitalization of the state and of households.

The talk also featured Julio Spigel, CEO and General Manager of Cable & Wireless Panama and Rodrigo Diehl, CEO of Tigo Panama; Luis Oliva, AIG General Administrator and Chairman of the Universal Service Access Board; Armando Alonso Fuentes Rodríguez, General Administrator of the National Public Service Authority. ASEP; David Proenza, Manager of Foodchain S.A. Productive Cluster/Foodchain; Moises Abadi ¸ President of Liberty Technologies on behalf of CAPATEC, as well as international panelists such as Virginia Nakagawa, Vice Minister of Telecommunications of Peru; Mauricio Agudelo, CAF Digital Agenda coordinator; Eduardo Chomali, CAF ICT and Telecom Specialist; Marco Dini, ECLAC Economic Affairs Officer; Maryleana Mendez, Secretary General of the Inter-American Association of Telecommunications Companies and Natalia Iregui, Senior Public Policy Manager, Central American, Caribbean and Andean at Amazon Web Services (AWS), who emphasized that the “Digital Transformation” is part of the Fourth Industrial Revolution. “We have been thinking in analogue for some time; it is time we start thinking digital,” added Iregui.