PRESS RELEASE

The Panama Maritime Authority (AMP), during the last 4 years, has made decisions responsibly and with the purpose that the Panamanian Ship Registry adapts to the changes required by the international maritime industry, to provide continuity and sustainability in the business, after observing in the year 2020 the results of an analysis of the historical statistics of the 5 registries with the most tonnage worldwide, which showed that if immediate actions were not taken, Panama would lose market leadership at the end of 2022.

According to the latest World Fleet Monitor published on July 26 from the international database Clarksons Research, (a British company that manages a database in the maritime field), the Liberian Registry of Ships ranks as the registry of vessels with the highest tonnage, with 246.5 million Gross Register Tons and 5,052 ships, while the Panama Ship Registry has 244.3 million Gross Register Tons and 8,254 ships (Panama continues to be the leader in ship registration) while the Marshall Islands Registry has 186.0 million Gross Register Tons and 4,231 ships.

Regarding the percentage of the world market that the first three registries have, in the latest publication of the World Fleet Monitor report by Clarksons Research, both Liberia and Panama appear with 16% and the Marshall Islands appears with 12%.

There are several factors due to which Panama was losing market presence, among which are highlighted:

• Lack of updating of the legislation that governs the Merchant Marine, while the maritime industry has greatly evolved, making Panama less competitive compared to other Flag States.
• The inclusion of our country in lists such as the OECD, FATF and the Panama Papers, situations that have somewhat weakened the credibility of our country’s service platform.
• The bureaucratic red tape that produced a significant delay in the various services provided by the Registry.
• Lack of statistical analysis, which, although it reflected that Panama was gaining tonnage, showed how it had been progressively losing market presence since before 2010.
• The lack of business strategies and little understanding of market growth, among other factors.

Nonetheless, the AMP has made important changes for the Registry to adapt to the current business model of the maritime industry, such as:

• Procedures and paperwork were shortened to reduce time and cost.
• We maintain constant communication with all the stakeholders, which provides feedback that, together with the study of the data, helps to make better decisions.
• The reform and revision proposal of Law 57 that was brought to the Board of Directors which will be presented to the Executive Body, a fundamental piece of the strategy and revision of the current model.
• Investment in technology, a pillar of current management.
• The reengineering of processes and the restructuring of procedures.
• Risk measurement and a system based on due diligence.
• Characterization of the markets, highlighting those where Panama has the greatest interests.
• The training of its human resources, among other actions, are factors that favored the growth of the Registry.

These actions show their fruits, according to historical data from the World Fleet Monitor report (verifiable data), in July 2019 the current Administration found the Registry in decline (-2.7%), a trend that was reversed during the first 10 months of government and as of May 2020, the Registry remains in positive numbers, reaching 3.9% growth at its best.

This has allowed us to date, to add more than 30 million Gross Register Tons, highlighting the best retention of tonnage increasing it to 36% and the best cancellation ratio (decreased by more than 10%), in other words, in the last 4 years, it has grown, retention has improved and cancellations have decreased. All this in the midst of a purge of the registry, where delinquent ships that do not comply are being canceled, which act in direct violation of international standards ratified and implemented by the Republic of Panama and in the midst of a contracted world economy, a product of the pandemic and the situation between Russia and Ukraine that has once again directly affected the large economic groups.

The Panama Maritime Authority (AMP), as regent of the Panamanian Registry, will continue its work of managing the fleet responsibly and always putting the interests of the country first.