The center is sanctioned by Panama's government and will be funded through a five-year grant from the National Secretariat for Science, Technology and Innovation, or SENACYT.

The center will be the latest in a network of Georgia Tech logistics facilities around the world. The university has had a similar center in Singapore for 13 years and opened one in Costa Rica last year.

The location of the Panama center still hasn't been finalized. Tech is considering two separate developments, both housed in converted U.S. military bases.

The City of Knowledge, a technology park on the western outskirts of Panama City near the Panama Canal, is the traditional home for foreign nonprofits, research groups and university outposts.

While it has a higher concentration of researchers, Panama Pacifica, an industrial park located on the former Howard Air Force Base, will likely attract more companies as it works to fashion itself as a logistics hub.

A decision should be made within the next few weeks, but Tech could end up with an operation in both places, said Don Ratliff, director of Georgia Tech's Supply Chain and Logistics Institute.

Either way, the center will need space for the 10-20 Panamanian research staff members who will work there daily. Georgia Tech faculty and students will occasionally take the four-hour Delta Air Lines flight from Atlanta to work on internships and special projects, Dr. Ratliff said.

The center will mainly focus on assessing Panama's logistics assets and offering recommendations on how the country can use them more effectively.

Largely capitalizing on Panama Canal traffic, the country has developed significant expertise in logistics and has benefited from its location to become an important crossroads for goods.

But it must develop human capital and better integrate its assets to become a true regional trade hub, said Dr. Ratliff, who added that a World Bank survey of countries' logistics performance ranked Panama No. 51.

"Countries that are big trade hubs [Singapore, Netherlands] are the ones that get the high rankings, and that's what Panama aspires to, so one whole area is to understand what it is that causes Panama to not be ranked higher," Dr. Ratliff told GlobalAtlanta.

The Panama Canal's expansion will double its capacity by 2014, so it's important to know which kinds of businesses will be best suited to capitalize on the larger trade flows, he said. For instance, Panama lacks temperature-controlled warehouses vital in the movement of perishable goods over long distances.

"There's no question that there's going to be more throughput through Panama. At the same time, it will create more opportunities for more logistics businesses, and there are issues on what they should be," Dr. Ratliff said.

Another major focus will be helping small and medium-sized U.S. companies use Panama to extend their reach in the region.

President Obama's effort to double U.S. exports over the next five years can't be accomplished only through lowering trade barriers, Dr. Ratliff said. Such an ambitious goal requires greater participation in more markets from smaller companies.

The problem is that these firms don't have the money or knowhow to approach each small Latin American market individually.

But if they could consolidate marketing, transportation, packaging and other operations in Panama, reaching Costa Rica's 4 million people, Nicaragua's 6 million or Ecuador's 13 million would be much easier.

"The idea is to serve these small countries in the same way that they serve (the massive U.S. market), to make it more like states in the same country than totally different countries," Dr. Ratliff said.

With more than 170 alumni the country, Georgia Tech enjoys an exceptional reputation in Panama, Dr. Ratliff said. Many Tech graduates occupy top government positions. Panama's vice president has a Tech degree, as do the second in command at the Panama Canal, the head of the Panama Canal Railway Co. and the man in charge of building Panama City's new metro system, he said.

When a Panama trade mission came to Atlanta in April, many of the delegation members couldn't wait to grab a few chili dogs at The Varsity near Georgia Tech's campus in Midtown.

Georgia Tech is assisting a partner institution in setting up at logistics center in Chile. The university is also exploring the prospect of centers in Brazil and Mexico. 

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