Ricardo Martinelli, the president of Panama, will be initiating a session at the country's National Assembly within the next few weeks to complete legislation granting the area of the diamond exchange a free-zone status.

Martinelli informed the leadership of the Panama Diamond Exchange (PDE) of his intentions after meeting with a number of representatives from the diamond industry last week. He also promised that his government would expedite Panama's membership in the Kimberley Process.

The international industry delegation that met the president on October 13 included World Diamond Council Chairman Eli Izhakoff, PDE President Erez Akerman, DDC President Moshe Mosbacher and Israel Diamond Institute Group Managing Director Eli Avidar.

The Panamanian legislation will provide permanent free-trade status to the area of the PDE. It will enable the import and export of diamonds into and out of the zone free of customs and tariffs, as well as a preferential tax-exempt status for companies that locate their businesses within the area of the PDE.

The special legislation was necessary because, although Panama operates the world's second-largest free-trade center after Hong Kong, this is the first time that such a status is being extended outside of the area of the Panama Canal.

“What it effectively will do is provide the diamond trade easy passage into the fast growing Latin American diamond market, complemented by a tax environment that compares favorably with those existing in diamond centers like Belgium, Israel and Dubai,” said Akerman.

Panama's membership in the Kimberley Process is also a critical step in the program. “President Martinelli's pledge to drive through the steps necessary to complete Panama's KP membership was most encouraging," said Izhakoff. "And his personal involvement in the entire process is definitely apparent. Immediately upon my return to New York from Panama, I was contacted by Panamanian government officials about procedural steps that need to be taken in order to obtain KP membership. I am confident that they are on track and will get the job done within a very short period of time."

The Panama Diamond Exchange is currently located in the exclusive Torre de las Americas complex in Panama City's Punta Pacifica business district. It eventually will move to the dedicated Panama Diamond Exchange Complex, which will be built in the Costa del Este neighborhood, alongside the highway between Tocumen International Airport and the Panama City center.

The offices and trading floor of the bourse will be located at the base of the complex, along with a luxury commercial center with shops, banks, restaurants and support services. Above the bourse will rise a secure office tower and a luxury hotel. The tower will comprise 45,000 square meters of office space on 45 floors, and the hotel will include 300 rooms.