Panama’s government has launched formal investigations into activating special agricultural safeguards on imports from the United States. The Ministry of Commerce and Industries (Panama) confirmed the move this week through eight separate resolutions targeting sensitive products like rice, chicken, and dairy. This action stems from the countries’ bilateral Trade Promotion Agreement and aims to protect local producers from a sudden surge in foreign goods.
Officials already activated one such measure on January 6 for specific cheeses, including mozzarella. Import volumes for these items reached the predetermined trigger levels outlined in the trade pact and national law. The immediate goal is safeguarding domestic production of Grade C milk, a critical raw material for local dairies and cheesemakers.
Daily Monitoring of Sensitive Tariff Lines
To enforce these protections, the ministry’s National Directorate of Treaty Administration and Commercial Defense is working with the National Customs Authority. They are conducting daily reviews of import volumes across 39 sensitive tariff lines. The list includes products like ice cream, powdered milk, paddy rice, and milled rice.
“This process allows for a timely reaction to protect our national industry,” said Daniel Tejada, General Director of Commercial Defense. [Translated from Spanish]
The special agricultural safeguard is an automatic mechanism. It does not require proof of injury to the local sector. The measure activates purely when import quantities exceed a specific annual volume threshold. Once triggered, authorities can impose an additional import duty for up to one calendar year.
Mechanics of Trade Protection
These safeguards are commercial defense instruments designed within the free trade agreement. They allow the state to react temporarily to prevent serious damage or a real threat to local production. Panama is specifically examining the special agricultural safeguard for its most sensitive farm goods.
This category covers tariff lines for rice, chicken thighs and legs, beef, pork, certain dairy products, vegetable oils, and processed tomatoes. Other safeguard types exist under the pact. Bilateral safeguards apply to any good where tariff reduction leads to import volumes high enough to cause substantial damage. Global safeguards follow World Trade Organization rules and apply to imports from all countries without discrimination.
When a bilateral safeguard is applied, it can last a maximum of four years and only once per product. The applying party must also agree with the trading partner on equivalent trade compensation. Failure to reach a deal allows the affected party to withdraw concessions of similar value.
Panama’s move highlights the ongoing balancing act for governments implementing free trade. The need to honor international agreements often conflicts with political pressure to shield domestic sectors. This tension is not new in Panama, where debates over trade impacts frequently make headlines. Previous disputes have shown how local farmers can feel threatened by imported products.
The current investigations will determine if other key products meet the criteria for immediate protection. Officials have not provided a timeline for concluding their reviews. Market analysts will watch closely for any impact on consumer prices or trade flows between the two nations.