SEED Expert Miguel A. Garcia replies:
Most of round parachutes need this hole as an escape for the air caught into the canopy. This supplies stability. Otherwise, the air entering from below should exit by the lower edge and then it would begin to oscillate increasing the vertical speed and endangering the landing of the jumper if he lands while in the descending portion of an oscillation. Its name in "Spanish translated into English" is "escape valve". I do not know its name in English tonight. Some old parachutes have an elastic cord that opens or closes the hole depending on the pressure inside the canopy.
SEED Expert Alex Moody-Stuart adds:
Adding some aeronautics, but no new eplanation, the high pressure under the parachute will bleed around the edge of the parachute to the lower pressure above. This causes vortices at the edges and over the canopy, which are not stable and tend to change how effective your parachute is at slowing your fall, randomly. If the parachute was solid, the vortices would not be so random, and the parachute would be hard to control, but not deadly. As the parachute is flexible, the changes in pressure above and below the parachute surface mean variable drag (what stops you falling faster) and even the collapse of the parachute's shape (very bad). The collapse of the parachute is what has to be avoided at all costs, so a hole in the centre allows high pressure air to pass through, at a controlled rate and, while open, provides a stability to the shape (all the high pressure air is below the parachute and has only one way out, through the top, where it cannot affect the shape of the parachute).
SEED Expert Philippe Theyes also adds:
Just an additional (and practical comment), the hole is needed to shape the parachute at the opening and align it perpendicular to the vertical.