Compressed Air Best Practices - June 2008 - (Page 20)

| 06–07/08 Focus Industry PHARMACEUTICALS | Puerto Rico, Pharmaceuticals and Airequipo Inc. Compressed Air Best Practices spoke with Douglas Gar rote-Arango (General Manager) of Airequipo Inc. Good afternoon. How are things in Puerto Rico? Good afternoon. Puerto Rico is the most wonderful place in the world (I’m definitely biased)! The island is 100 miles long by 37 miles wide. We belonged to Spain from 1493 to 1898 when we became a territory of the United States. We have a mix of cultures and a unique political situation, as we are neither an independent nation nor a state of the union. This is why they say “PR is the best of both worlds.” What drove the growth of the pharmaceutical industry in Puerto Rico? In 1976, a U.S. government incentive was created called the “936,” after the U.S. Internal Revenue Code, Section 936. The “936 incentive” made it possible for any company manufacturing in Puerto Rico to repatriate profits without paying any taxes on their income. This is what brought the pharmaceutical industry here. When Bill Clinton won the election, there were concerns that U.S. jobs were being lost to Puerto Rico and they cut the “936 incentive” by 40%. The remaining 60% of benefits were phased out over the next ten years ending in 2005. In order to maintain its benefits and make their operations competitive, some companies where able to convert to “controlled foreign corporations” (CFC) another section of the IRS Tax Code, under section 956. What is the current business climate? Unfortunately our economy is a reflection of the economy in the U.S.A. with a six-month lag. It has worsened these past four years, among other things, because our government (Executive, House of Representatives (HR) and Senate) is divided between two parties and we have had little legislative action. This has created tremendous problems to legislate and move our own economy, not to mention the other indirect result of slow down in the U.S.A. economy. But with regards to our particular situation, it got to a point that our government was actually closed for two weeks. What kind of industry exists in Puerto Rico? In the 1940s, agriculture was the market driver in Puerto Rico. The crop industries of pineapple, coffee and sugar supported the economy. In the 1970s, we saw the strong entrance of the pharmaceutical industry. Today, we have a diverse industrial manufacturing base including pharmaceuticals, electronics, rum, beverage concentrates and medical equipment. Consolidation has occurred here — just like in the U.S. The 2008 Airequipo Booth at Interphex Puerto Rico: from left to right: Douglas [Macar] Garrote (VP & General Manager), Laureano Garrote (President), Raul Garrote (VP Service), Néstor Rivera (Parker Hannifin Corp,Territory Manager), Roberto Garrote (VP Sales) and Mario Bolivar — National Accounts Manager, Industrial Nitrogen Products. 20 www.airbestpractices.com http://www.airbestpractices.com

Table of Contents Feed for the Digital Edition of Compressed Air Best Practices - June 2008

Compressed Air Best Practices - June 2008 Contents From the Editor Utility-Air News A Pharmaceutical Compressed Air System Audit Talking Dew Point Puerto Rico, Pharmaceuticals and Airequipo Inc. Oil-Free Rotary and Oil-Free Centrifugal Compressor Comparison SMC: Managing Energy and Dew Point in Pneumatic Systems Utility Grade Compressed Air Systems Training Calendar & Product Picks Wall Street Watch Advertiser Index Job Market

Compressed Air Best Practices - June 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.