Requests from Palmaseca Free Trade Zone companies for the next roundtable discussion with the government: this is what the Ministry of Commerce agreed upon.

The Ministry of Commerce, Industry, and Tourism's announcement of the extension of the current operating contract for the Palmaseca Free Trade Zone in Palmira, while the new contract is awarded through a public bidding process, has provided some reassurance to unions and authorities in this municipality in the Valle del Cauca region and throughout the department.

"In a meeting led by the Minister of Commerce, Industry and Tourism, Diana Marcela Morales, and the Mayor of Palmira, Víctor Manuel Ramos Vergara, with the participation of representatives of all stakeholders related to the Palmaseca Free Trade Zone (on July 9), the minister announced that the current administration contract will be extended from August 1 to September 30," the ministry reported.

While a light at the end of the tunnel is expected, and for now, an additional deadline has been given to continue this operation as it is being carried out by the current administrator, Valle unions and business owners from this free trade zone are looking forward to the dialogue table they have been demanding with the Government to analyze the conditions that will allow removing the obstacle to submitting proposals for a new bidding process. This will be held next week, as Minister Morales also announced.

None of the country's 120 free trade zone operators have submitted bids, according to the Inter-union and Business Committee of Valle del Cauca (Ciev).

This extension of the current management contract means that the current operator remains in place while the government advances another tender until the end of September, when the new stipulated period will expire.

This selection process for public procurement has already been attempted six times , all of which have failed because no bidders have accepted the lease conditions for the Palmaseca Free Trade Zone, as set by the Ministry of Commerce. The free trade zone has indicated that the conditions are financially unviable.

The last attempt, declared void, was on July 8th, the deadline for submitting bids for the tender, a call that had been open since June 12th. On that date, the Palmaseca Free Trade Zone issued a statement, highlighting rent increases that make it impossible for its users to continue operating. This, as they have stated, is a death blow to this sector of the Valle del Cauca economy and would impact the rest of the country.

Free trade zones, such as Palmaseca, are industrial and commercial zones for goods and services, designed to promote and develop the industrialization process, provide services primarily for foreign markets, and conduct marketing.

"It is a permanent free trade zone, administered and managed by a private company operating since July 1, 1994 (it will celebrate its 31st anniversary), known as the user operator, which has specialized in infrastructure development, promotion, compliance, and application of the free trade regime, contributing to the growth not only of the region, but also of the country," describes the Palmaseca Free Trade Zone, which has more than 50 companies between the permanent free trade zones (as there are also temporary ones) and special permanent free trade zones in the same region.

In a free trade zone there are operating users (national or foreign legal entities legally established in Colombia, which can build infrastructure and buildings in the free trade zone, carrying out controls on the entry and exit of merchandise, and ensuring the application of the free trade regime), developer users (who also build infrastructure), industrial users of goods (they manufacture, produce, transform or assemble them for sale in priority external markets), industrial users of services (their activities are oriented to services for external markets with a scientific and technological focus) and commercial users (storage, conservation, handling, distribution, packaging, repackaging, classification and cleaning services for goods, which may be destined for external markets or the national market).

In this history of concerns about the future of more than 7,000 direct and indirect jobs generated by the Palmaseca Free Trade Zone, business owners have argued that the Ministry's current conditions are a lease on the operating contract, with increases of 700 percent and annual adjustments to the CPI+3.

For them and the Valley's unions, if this were the case, the amount would double, resulting in a settlement in the coming years because the rent would be double and could not be covered over the course of the decade.

The Palmaseca Free Trade Zone business owners and potential bidders, who have balked at the possibility of operating it, are asking the government to renegotiate the operating contract now that there is a new deadline of September 30, taking into account the current conditions in the municipality of Palmira due to the economic transformations it has undergone. They cited the renegotiated free trade zone contracts in Barranquilla and Cartagena as examples.

The mayor of Palmira, Víctor Ramos, said after the meeting with Minister Morales on July 9 that the extension of the operation provides a measure of peace of mind.

The president indicated that next week there will be a "joint working group" with Free Trade Zone users, representatives from the Valle government, the mayor's office, unions, business owners, and operators from across the country.

"The minister has been determined to create these spaces for reconciliation for the well-being and competitiveness of Valle del Cauca," said Mayor Ramos.

The Ministry of Commerce, Industry, and Tourism announced the extension of the Palmaseca Free Trade Zone management contract. The ministry believes this extension "guarantees the free trade zone's operations while a new bidding process is carried out."

He reiterated that next week there will be "a space for inter-institutional dialogue to listen to the concerns of all stakeholders."

"This decision guarantees normal operations (as the current licensed operator has been doing until September 30), while a new selection process is carried out to select the free zone tenant. In this regard, the minister provided reassurance regarding the continued operation of the Palmaseca Free Zone, highlighting the government's interest in promoting national industry and strengthening the productive apparatus," the Ministry of Commerce reported.

During the meeting, the minister reiterated that "the conditions of the bidding processes respond to the strict application of the recommendations and observations issued by the Comptroller General of the Republic, the Council of State, and the specialized technical study conducted by Central de Inversiones SA (Cisa)."

"One of these conditions is related to the value of the lease, which was determined based on technical and legal criteria aimed at ensuring transparency and sustainability in the process," the Ministry explained.

Regarding next week's meeting: "This meeting will allow us to directly hear your concerns and proposals, as part of the Ministry's commitment to maintaining and strengthening an open, respectful, and ongoing channel of communication with interested entities," according to the Ministry's commitment.

"It should be noted that, from the beginning, the Ministry has maintained ongoing and open communication with the various stakeholders, reaffirming its willingness to engage in constructive dialogue and jointly seek solutions," the Ministry of the National Government stated.

However, the Ministry clarified regarding this dialogue table: "It is important to emphasize that this space is not part of the pre-contractual procedure nor does it imply the joint development of the conditions of the bidding process, the powers and decisions of which fall exclusively to the Ministry of Commerce, Industry and Tourism, in accordance with the current legal framework.

The governor of Valle del Cauca, Dilian Francisca Toro, said: "I've been speaking with the Minister of Commerce for about two weeks and with the mayor of Palmira. We've been closely monitoring this issue, especially because 7,000 jobs would be lost in the free trade zone."

The president added: "What I discussed with the minister is that they will continue to manage the entire issue of the free trade zone, that it will not be closed, and that it is very important to say that it will not even close the jobs."

The governor added that the efforts being undertaken are aimed at "ensuring that the Palmaseca Free Trade Zone remains open and that jobs are maintained."

The Ministry of Commerce, Industry and Tourism also reported that "it has taken the necessary steps to select the tenant for the Palmaseca Free Trade Zone, publishing six selection processes starting in 2024, including the one declared void yesterday (July 8), and has created spaces for dialogue with unions and other stakeholders with the goal of ensuring the free trade zone's operation."

He also reported: "Likewise, from the many observations received regarding the development of processes within the principles of responsibility, planning, and objective selection, those observations that ensure compliance with the criteria of economy and administrative efficiency have been accepted."

"Taking into account observations made to the Ministry by the supervisory bodies and the Council of State, the structuring of the latest selection processes, regarding rental fees, has been based on the idea that these must be aligned with adequate market margins, since the goal is to achieve balance and stability in the annual income and expenditure equation, rather than generating a specific profit in and of itself," the ministry stated.

"It is worth noting that, in the development of these processes, preventive support from the oversight bodies has been requested to ensure the legality of the process, and invitations have also been extended to all certified user operators in the country to guarantee a plurality of bidders," the Ministry stated.

Correspondent for EL TIEMPO