Why Panama ?

Living in Panama

Pro's:

     The country of Panama is a great place to live.  In addition to a year-round tropical climate, two oceans, picturesque mountain villages, a world-famous Canal, jungles, islands, beaches and rivers, Panama has one of the lowest crime rates in this hemisphere.  Panamanians are generally friendly, and many speak some English.  Most of the country has excellent drinking water, reliable electricity and very good telecommunications.

     Panama City has excellent dining, culture, nightlife and shopping.  The city has very good housing, and good private schools.  There are direct, daily flights to many major cities in the U.S. and Latin America.  Panama City has several first-rate medical facilities, along with well-trained medical personnel.

     The cost of living in Panama is generally lower than in other Latin American capitals, and is lower than major cities in the U.S. and Europe. 

     Panama has a strong, stable democracy and a tradition of democratic electoral process.  Most - if not all - of the vestiges of military dictatorship have been eliminated and forgotten over the past 20 years.  Presidential and legislative elections are largely clean and transparent.

     Panamanians genuinely like foreigners, especially Americans.  There are no terrorist groups in Panama.

Cost of Living

     A growing number of foreigners are choosing to retire in Panama.  Compared to the U.S., Canada or Europe, Panama has a lower cost of living, the cost of housing has historically been lower, and personal services (such as a maid or gardener) are very affordable. 

Medical - Hospital

     Panama City also has several good hospitals and medical facilities, and a wide variety of well-trained doctors and nurses.  Most of the doctors speak serviceable English, and a sizable minority have studied in the U.S. or Europe.

     Potential retirees should note that U.S. Medicare / Medicaid does not cover countries outside the U.S.

Food - Dining

     Panama has excellent fruits, vegetables and produce; spectacular fresh seafood; good beef, poultry and pork; delicious water; and a very good (albeit more expensive) selection of imported food products from the U.S. and Europe.  Panama has several local chains of well-stocked grocery stores, as well as the U.S. Costco chain with locations in Panama City and David.

     Panama City has a wide variety of excellent restaurants, as well as almost every fast food chain found in the U.S.  Panama City also has theme restaurants such as TGI Friday's and Bennigans.

Utilities

     Utilities services in Panama are very good: excellent telephone service; excellent internet access; excellent water; reliable electricity (albeit expensive); widely available natural gas; reliable garbage pick up; cable TV in the major cities; and Satellite TV throughout the country.

     Panama's state-owned mail system has no home delivery - you must get a P.O. box.  The state-owned mail system is perceived as unreliable and inconsistent.  There are several private mail services in Panama, including Mail Boxes, Etc., that provide both a U.S. and Panamanian mailing address for incoming correspondence and packages.  Outgoing correspondence and packages must be sent via Panamanian mail or courier such as Federal Express or DHL.

Entertainment   

     Panama City has several state-of-the-art movie theater complexes which feature first run Hollywood movies in English (with Spanish subtitles).  Popular European and other foreign films are shown as well.  The video rental chain Blockbuster has locations throughout the country.

     There are a number of theaters in Panama City that produce stage plays (normally in Spanish), musicals, ballets, and modern dance.  Panama has a national symphony orchestra, and Panama's National Theatre has completed a major renovation.

     Each major town in Panama has a baseball and a soccer stadium.  During their respective seasons, regional teams compete on a rotating basis.

     Panama City has a wide variety of bars, lounges, discotheques, and night clubs, featuring blues, jazz, rock and roll, disco, hip hop, trance, salsa and reggae. Many clubs offer live music, and most are open until 4:00 AM.

Sports and Exercise

     Panama's tropical climate, two oceans, and over 1,300 miles of coastline offer excellent water sports, including swimming, snorkeling, scuba diving, fishing, boating, surfing, kite boarding, windsurfing and sailing. Panama's mountain rivers offer excellent white water rafting; while Lake Gatun, part of the Panama Canal, boasts excellent fresh water fishing.

     Panama City has several very good golf courses, as well as tennis facilities and a racquetball center.  Many people run, jog or walk at the Parque Omar, located in the City's center, or ride bikes on the Amador causeway. 

     The major hotels in the City (such as the Marriott, Inter-Continental, Radisson and Hotel Panama) have extensive gym and spa facilities available to non-guests.  There are also several modern gyms available on a daily, weekly or monthly basis.

     Panama City (along with most major towns throughout the country) has several olympic-sized swimming pools, often located within parks. 

Con's:

     Rainy season brings rain and very high humidity throughout much of the year (May - December).  It is often difficult to find individuals who speak fluent English, especially outside the cities of Panama and Colon. Panama's roads system is poorly marked and maintained, and Panamanians are not cautious drivers.  Rush hour traffic jams in Panama City are legendary.

     Panama has few sewerage treatment facilities; raw sewerage is dumped into rivers, and thereafter into the oceans.  The Bay of Panama, while picturesque, is fetid.

     Dealing with the Panamanian government, for anything and on any level, is often a difficult, time-consuming and unrewarding experience.  Many private sector businesses rival the government in their pursuit of bureaucracy and indifference.

     Practically everything in Panama requires a lawyer.

     Panama is not without its share of con artists, shysters, and swindlers.  Some are Panamanian, many are foreigners, and they operate at all levels.  We recommend caution and due diligence. 

      Real estate transactions can be especially perilous, especially those dealing with derecho posesorio (rights of possession, as opposed to titled property).  Caveat Emptor.

     Panama's labor code, which rules all relationships between employer and employee (formal and informal), is confiscatory.  Labor code disputes make up the bulk of legal problems between foreigners and Panamanian.

Doing Business in Panama

Pro's:

     Panama offers one of the most modern economies in Latin America.  In addition to the U.S. dollar as its national currency, Panama enjoys very low inflation and zero foreign exchange risk.  There are no controls or restrictions on capital repatriations.  Panama has over 140 banks, and is an international center for finance, insurance and shipping.

     Panama has a long and proven track record of capital investment protection, for both nationals and foreigners.  Panamanian and foreign investors are treated equally under Panamanian law, and there are no legal restrictions to foreign ownership -- or foreign participation in -- local or international businesses.

     The government offers fiscal incentives and tax breaks for investments in several key areas of the economy.  Government oversight and regulation of private sector business is considerably less rigid than in North America or Europe.

     Panama's air, sea and rail transportation infrastructure is very good.  Panama has a Category 1 rated international airport (recently renovated) with air cargo facilities; four major Atlantic and two major Pacific ports (privately owned and well run); the Panama Canal; and a railroad that runs alongside the Canal and connects the ports.

     The Colon Free Zone, located on the Atlantic terminus of the Panama Canal, is the second largest free zone in the world (after Hong Kong) and is the largest in this hemisphere.  The CFZ is a major trans-shipment point for manufactured goods from Asia to the Western Hemisphere.

     Panama has no tort laws.  Thus, Panamanian corporations do not face the risk and potential liabilities as incurred by businesses operating in the U.S. and Europe.  Additionally, businesses operating in Panama are given further protections and security.

     Panama is an excellent hub for doing business in the rest of Central or South America.  Panama is a member of the Central American Free Trade Agreement (CAFTA) with the United States.  Panama has daily flights to all Central American and most South American capitals.  Also, some Panamanian banks have branches in other Central American countries.

     Panama's economy grew at 6.8% in 2008, and is projected to grow between 1.0 and 3.0% in 2009.  Investment, both foreign and domestic, continues to climb.  Inflation rates are similar to the U.S. and Europe.  See the Panama at a Glance page for further details. Tourism, and investment in tourism properties, is up sharply.  Real Estate prices are leveling off, after four years of sharp growth.

Con's:

     In spite of the tax breaks and fiscal incentives offered by the government, the approval process is often interminably long; processing the subsequent paperwork is often longer and more frustrating.

     Practically everything in Panama requires a lawyer.

     Panama's labor laws continue to be a major barricade to further growth and foreign investment.  While labor costs in Panama are low compared to those in the developed world, the Panamanian labor code dictates almost every conceivable aspect of the employer - employee relationship.  Employee benefits are generous; infractions of the labor code are expensive.  Caution is advised.

     Some consider it difficult to find qualified, competent individuals at all staffing levels.  Those accustomed to doing business in the U.S., Europe or Asia may find it necessary to devote extra resources to management and administration.  Additional oversight is advised.

CONCLUSION:

     Panama is a great place to live, work, do business and make money.  Panama is not without the problems and frustrations inherent in developing nations.  Still, the benefits far outweigh the drawbacks.  For that reason, Panama is drawing increasing numbers of new businesses, immigrants, and retirees.

     The key to success in Panama, we believe, is to take advantage of the good, and to insulate yourself from the difficult and the frustrating.  We've been here for over two decades and counting.  We know the territory well.  Contact us with any questions or information you need.  We'll be glad to help, or to refer you to someone who can.

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