Panama eyes S. Korea alliance to get off tax haven list

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December 8, 2017 1:19 AM

Panama is looking to join forces with South Korea as it wages a "diplomatic offensive" to get off a newly unveiled EU tax blacklist, officials from the Central American nation said Thursday.

The nation, stung by last year's "Panama Papers" revelations which showed how the world's wealthy used a discreet Panamanian legal firm to stash assets offshore, is furious it is one of 17 states on the list made public on Tuesday.

Panama, South Korea and the United Arab Emirates were the most prominent countries on the list.

Panamanian finance minister Dulcidio De La Guardia told state television that officials from his government were holding meetings with European authorities to protest against being on the list.

He also said that Panama was seeking to combine efforts with South Korea, which has slammed its inclusion as contrary to international standards and its sovereignty.

Panama's foreign minister, Isabel Saint Malo, has already met with her Spanish counterpart Alfonso Dastis and Portugal's deputy foreign minister Jose Luis Pereira in Guatemala to press Panama's case, a Panamanian official told AFP on condition of anonymity.

Saint Malo expressed her country's "utter rejection" of the European decision, while Dastis and Pereira offered verbal support to her demand that Panama's inclusion be looked at again, the official said.

Some voices in Panama's business sector, heavily reliant on lawyers and banks, have been calling for retaliation against EU companies or interests.

But De La Guardia said "it is very premature to announce any sort of measure" in that sense.

He warned, however, that "if this dialogue is not fruitful, then Panama will have to see what action to take in the private sector."

In the wake of the blowback caused by the "Panama Papers," Panama passed a law in September 2016 allowing it to take a range of steps against countries deemed to "engage in practices that discriminate or imply damage" to its economic interests.

Though dormant so far, the Panamanian law permits tax, trade and migration measures to be taken against companies or individuals from the offending countries.

The European Union has not yet decided whether to impose any sanctions against the countries listed as tax havens.

Some EU members, including France, want tough measures to be taken, including possibly an exclusion from World Bank or EU funding.

France put Panama on its own national tax-haven blacklist immediately after the "Panama Papers" were made public, angering the Central American country.

The countries on the EU list are: American Samoa, Bahrain, Barbados, Grenada, Guam, Macau, the Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, South Korea, Trinidad and Tobago, Tunisia and the United Arab Emirates.

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