Colón Free Zone
The largest duty-free commercial hub in the Americas and the second largest free zone in the world, on Panama's Atlantic coast next to three major ports.
What it is
Founded in 1948, the Colón Free Zone (Zona Libre de Colón, ZLC) lets companies import goods, store, assemble, repackage and re-export them without paying import duties in Panama. Its location, close to three Atlantic ports and the canal, makes it a distribution base for Central America, the Caribbean and the Andean region. Early tenants included Gillette, Coca-Cola, Pfizer and Parke-Davis.
By the numbers
| Measure | Figure |
|---|---|
| Trade in 2025 | $27.9 billion, up 11.9% from $24.9 billion in 2024 |
| Re-exports in 2025 | $16.1 billion, up 11.9% |
| Imports in 2025 | $11.8 billion, down 7.3% |
| Top suppliers | China (40.6%), United States (8.8%) |
| Top re-export markets | Panama, Venezuela, Colombia, Costa Rica, Guatemala and the United States, together 64.5% |
| Companies and jobs | More than 2,700 companies and over 18,000 jobs in Ministry of Commerce and Industries materials (2021); current counts are best confirmed with the ZLC |
Source: La Estrella de Panamá, January 2026. Figures for part of 2025 differ between the national statistics institute and the ZLC.
Why companies use it
Location
Atlantic side of the canal, next to three container ports, with fast access to Panama City and Tocumen Airport.
Duty-free operations
Goods can be stored, processed and re-exported without import duties, which suits wholesalers and regional distributors.
A regional customer base
Free trade and commercial agreements covering more than 60 countries give companies based in Panama wider market access.
Pairs with other regimes
Companies can combine a ZLC base with regional headquarters under the SEM regime or manufacturing services under EMMA.
What to know
Challenges
Aging infrastructure, slow digitalization, e-commerce competition, new regional free zones and international reputation issues are cited as challenges, and the zone is working on modernization.
Doing business there
You need a company, a lease or purchase of space, and the right customs registration. We introduce you to the lawyers, brokers and agents who handle this.
Our background
Richard Kilborn was National Director of Investment Promotion at the Ministry of Commerce and Industries, where his department promoted the Colón Free Zone, SEM, EMMA and private free zones to foreign companies and handled licensing for SEM companies and private free zones. That experience informs how we help businesses decide where and how to set up.
General information, not legal or tax advice. Verify current requirements with the Colón Free Zone administration and a Panamanian attorney.