Logistics and Beyond: Panama’s Links With Georgia Deep and Diverse

When traveling in Panama, visiting its iconic canal is a must. (Who goes to Paris without seeing the Eiffel Tower?)

But for Georgians, the storied waterway has a more practical resonance: It’s a transit point for a large segment of imports from Asia that land at the Port of Savannah before being dispersed around the country. 

That’s one reason the Georgia Ports Authority has made a point of linking up with the Panama Canal Authority, establishing strategic partnerships to share information and resources over the years. It’s also why Georgia politicians, from Atlanta City Hall to the Gold Dome, have been paying close attention to goings-on in the isthmian nation. 

Since the canal’s expanded locks opened in 2015 (months behind the scheduled unveiling at the centennial celebration in 2014), a longtime ambition to deepen the Savannah harbor has taken on even greater importance.

More than 60 percent of ships now calling on the Savannah port are “neo-Panamax,” those so big that they only fit through the canal’s larger locks. Nearly 40 percent of Savannah’s imports traverse the canal, the highest proportion of any port on the East Coast. Savannah processed a record 4 million containers overall in 2017, and it’s looking to double its container processing capacity by 2028. Panama will be a vital transit point as shippers deploy larger vessels to realize new economies of scale when bringing goods from Asia. 

Georgia Tech Ties

Panelists at Global Atlanta’s Latin American Crossroads series discuss their ties with Panama.

While logistics forms the backbone of the state’s ties with the country, it’s certainly not their only vital connection, as became clear from Global Atlanta’s Latin American Crossroads event on Panama in December.

Sponsored by Emory Executive Education at Emory University’s Goizueta Business School, the event featured four panelists from business and academia exploring themes ranging from education to business deals to building a sustainable city in the jungle. Georgia was the common thread in the meandering conversation. 

It might be said that President Jimmy Carter laid the strongest foundation for Panama’s eventual ties with his native state. Mr. Carter in 1977 made the bold but unpopular decision to hand over control of the U.S.-built canal to the Panamanian government by 1999, starting the clock for Panama to build up its own management capacity.

Georgia Institute of Technology was a direct beneficiary, as Panamanian students, many from influential families, came to Tech to learn about supply-chain management, logistics and other fields in the 1980s and ’90s.  

But the second decade of the 21st century was when Georgia Tech’s ties with the country reached an even higher plane, Marta Garcia, vice president of international development, said during the Global Atlanta event. 

More than 10 years ago, a prominent alumnus came to her and suggested that Tech explore opportunities for research collaborations in logistics. At the time, the university was already engaged with Singapore on a similar project, but nearby Panama, with its proximity and its canal, held significant intrigue. 

“Our faculty were flying off to Singapore to do research in logistics. It was 24 hours away and they were spending gargantuan amounts of money, but this huge opportunity was right here, right in our hemisphere,” said Ms. Garcia.  

Roberto Roy, who would later become the country’s cabinet minister in charge of the canal as well as Central America’s only metro system, was already a prominent player. A Georgia Tech alum himself, he urged Ms. Garcia to bring researchers down to investigate the educational partnerships. There was only one problem: State funds couldn’t be used for an exploratory junket. 

The Panama Canal’s new Pacific locks under construction in 2014. Photo by Trevor Williams

Mr. Roy helped rally together a disparate group of alumni some 200-strong to raise the necessary cash for the provost and other leaders to travel to Panama, as well as to fund later feasibility studies. They bet that Georgia Tech’s leaders would see the light, if only they would come. 

“That’s exactly how it was,” Ms. Garcia said. “They came and they saw and they were blown away by the opportunities in Panama.”

The stars began to further align in 2009: Another Georgia Tech alumnus, Juan Carlos Varela, was elected vice president, and in that same year Tech set up a center in San Jose, Costa Rica, dedicated to helping that country improve the competitiveness of its supply chains. The Panamanians were stirred to jealousy, and when the country’s science and technology arm, SENACYT, issued a request for proposals for a logistics center, Georgia Tech competed and won. Since it opened in September 2010, the Georgia Tech Panama Logistics Innovation & Research Center has received about a million dollars annually in government funding.  

Mr. Varela eventually became president in 2014, but even before he came into office, he’d had personally funded a full scholarship for one Panamanian student to complete a four-year degree at Georgia Tech.

Ulises Nunez, the high-school valedictorian of Panama, was that fortunate recipient, and last spring he became the first-ever Panamanian graduate in aerospace engineering from Georgia Tech. Mr. Varela, now president, was there as the commencement speaker.

Now, Mr. Nunez is on well on his way to his childhood dream of becoming an astronaut — or at least contributing to the future of flight in his country. He’s signed on as a Georgia Tech doctoral student focusing on space craft navigation and controls, meaning that he’ll be in Atlanta for another six years. 

Mr. Nunez sees aerospace as a tool for development in Panama, which is just starting to realize the full potential of its location. Yes, it’s a strategic crossroads for military and maritime purposes, but it’s also a hub for commerce — and that should benefit Panamanians, he said. 

“I don’t think Panamanians want to use our importance to be geopolitical only, but to use that location to bring economic development,” Mr. Nunez said during the Global Atlanta panel. “That’s also why we are running the canal not as a military base but as a commercial endeavor.”

Jungle Towns and Helicopter Handshakes

Kalu Yala’s current town square.

With a population of not quite 4 million, Panama is a place where a lot can be done with the right relationships. 

Just ask Jimmy Stice, who is in the midst of building a sustainable settlement in the middle of the Panamanian jungle. 

Kalu Yala is an ambitious experiment in proto-urban design, born after an Atlanta-based real-estate investment company run by Mr. Stice’s father, Sandy, bought about 575 acres of Panamanian farmland. 

Even before graduating from the University of Georgia in 2006, Mr. Stice had been noodling on the idea of creating a new town that would blend environmental sustainability and economic inclusion.

It builds on “new urbanism,” which prizes walkability and environmental sensitivity, but adds a sense of responsibility for creating jobs and improving livelihoods in the surrounding community of San Miguel

“When you say you’re in real estate, you kind of get a look like, ‘These are the people who are exploiting the world,’” Mr. Stice said. He wanted to change that, with a startup that could ideally provide a model for solving some of the world’s most pressing challenges.    

He viewed Panama, with its tropical climate suitable for year-round agriculture, ambitious and open government, industrious population, and stratified economy, as the right place to test whether the status quo of city design is in fact inevitable. Developments like Georgia’s Serenbe may be laudable, but they might not be scalable, he said. 

“What we’re doing differently is we’re trying not to build a resort town; we’re trying to build a town that actually produces jobs, that actually has goods and services which it exports in order to create socioeconomic mobility,” Mr. Stice said during the Global Atlanta event. “When I got off the plane in Panama, I said, ‘This is the place where this idea needs to be born.’”  

The implementation over the last decade, meanwhile, has been rocky. A Viceland documentary reality series on Kalu Yala, “Jungletown”, exposed the harsh difficulties of cultivating a community out of 18- to 25-year-olds forced to create infrastructure from scratch. Mr. Stice has received a fair share of criticism for charging interns as much as $7,500 to live, study and work in what amounts to a jungle encampment, even as he travels the globe to raise money.   

But Mr. Stice says his important relationships are those with his neighbors in San Miguel, the nearby Panamanians he hopes Kalu Yala will eventually impact in a positive way. The town’s success, in other words, is about more than the bottom line — and he sees that as a lesson for other entrepreneurs seeking to make their mark in a small but influential country. 

“I always tell people I don’t think there’s a place where you can have more influence per capita in the world than in Panama right now,” Mr. Stice said. 

[pullquote]”I don’t think there’s a place where you can have more influence per capita in the world than in Panama right now.” -Jimmy Stice[/pullquote]

But it’s not a get-rich-quick environment, and setting down deep roots is necessary. 

“That’s were businesspeople sometimes get it wrong in Panama. They don’t take the time to go through the soft stuff of developing relationships, developing friendships, taking the time to learn the cultural and political habits of Panama. They just want to come and transact a deal and get done with it. If you’re going to do it that way, that transition is probably not going to work out in your favor.”

Sean Casey learned first hand about the value of relationship when he traveled to Panama just for a five-minute meeting with a key client.

Renderings of Kalu Yala homes, which aim to have a cost that’s in reach for the middle to upper-class Panamanian. Photo: Kalu Yala

The vice president of Rotorcorp, an Atlanta-based exporter of Robinson Helicopter parts, caught wind of a chance to supply an offshore fishing company with a major order. 

“The owner of the company said, ‘I want you to come here and I want you to look me in the eye,’ so I didn’t have much of a choice in the matter,’” Mr. Casey said. “If I had told him that I don’t want to do the transaction or that I didn’t travel l for business, that probably would have been the end of that.”

Since then, Rotorcorp has built on this relational foundation, selling the buyer more parts and even used helicopters, growing revenues from Panama fivefold in the last three years. The company is eyeing Panama as a location for a Central and South American sales and service center. 

So far, doing business in a country where many companies complain of endemic corruption has been a breeze for Mr. Casey. Panamanians, in his experience, are straight shooters. 

“They do what they say they’re going to do. There’s not a whole lot of glitz and glamor, there’s not a big dance,” he said. “I enjoy that.”