Panama. Why invest or relocate?

July 23, 2013 |

Why invest, relocate, or move to Panama?

Safe Democratic Process.

Politics of Panama takes place in a framework of a presidential representative democratic republic, whereby the President of Panama is both head of state and head of government and of a multi-party system.  Executive power is exercised by the government.  Legislative power is vested in both the government and the National Assembly. The Judiciary is independent of the executive and the legislature.  Basically the same as the United States with the same pluses and minuses.  The President is not eligible for a second term.  Elections are every 4 years.  You may expect to find a rough and unstable government, shabby, squalor conditions and anti-American sentiment. But the truth is almost the exact opposite. Panama is safest, most stable place in Central America.  For the past half-dozen years, the Panamanian government has focused on getting foreigners to put money into the country’s economy.  The government realizes that foreign investment will help the country as a whole…and so it has passed more than 40 laws protecting foreigners’ investment rights, including the Investments Stability Law (Law No. 54), which guarantees all foreign and national investors equal rights.

 

Politics in this country.

Politics in this country.

Economy.

At present, Panama is growing year after year at between 7% and 11% since 2006.  Panama suffered for over a decade from the Noriega debacle of the eighties which severely damaged the reputation of the country for over a decade.  Previous to this internal invasion and several years of tyranny, Panama enjoyed infrastructure and financial and social progress exceeding any country in the region.  Because of this, when world wide economic systems were bubbling and neighboring Costa Rica was in a fanatical boom for 2 decades, Panama was relatively isolated and unattractive until foreigners began catching on around 2004, 15 years after his US led removal.  Mostly because of the Panama canal expansion, other internal government funded projects, and aggressive foreign investment incentives, Panama has been on a steady and realistic climb since that time.  Panama City is an important hub for international banking and commerce, so if you are looking to invest or start a business while living in Panama, you will have plenty of resources at your disposal. Panama uses the U.S. dollar as its legal tender

Owning Property and Residing.

Foreigners in Panama have the same title and property rights guaranteed by the constitution both under the law and in practice as do citizens.  Panama law and processes are often very similar to that of the U.S.  No doubt this is as a result of the influence the United States has had on Panama for nearly a century.  Tourist visas are now commonly given for six months.  After that time, if a tourist wants to stay longer, he must leave for a short period of time.  This can be merely a visit to Costa Rica.  A foreigner who makes Panama his principal place of residence can get residency.  One who does not may also be able to qualify for residency by means of starting a business or making an investment in Panama.

Undervalued real estate.

The infrastructure of Panama far exceeds any country in the region.  Panama citizens are provided with excellent paved roads, water and electricity in even some of the most remote areas.  Except for in select locations like Bocas Del Toro and Panama City, real estate in Panama sells for fractions of what neighboring Costa Rica sells for.

Affordable

Panama is a developing nation, but living here doesn’t mean you’ll be living in the Third World. Panama is full of the comforts and luxuries that many search for overseas but can rarely find in combination with an affordable cost of living. In fact, most people can significantly improve their quality of life by living in Panama, and they do so without having to live in an unsafe country with poor infrastructure.

diverse-happy-older-women

Diversity

Panama is so welcoming to foreigners partly because it is already a very diverse society. The population here is a true ethnic mix, with heritages including Spanish, African, Amerindian, and North American. There are several indigenous groups that live in Panama, such as the Kuna, Emberá, and Bribri. The Kuna are the most well known and recognized indigenous population in Panama, partly due to the beautifully colored attire worn by the females and the gorgeous molas they weave.

Affordable heath care

Every tourist entering Panama receives a month of full coverage health insurance.  Panama offers high quality health care and modern hospitals in the metropolitan areas. For example, the Johns Hopkins-affiliated Punta Pacifica Hospital is the most technologically advanced medical center in Latin America.  Many Panamanian doctors are U.S.-trained, and the standards at the top city hospitals compare very favorably with those in the U.S., Canada, and Europe.  Private health insurance is available and much less expensive than insurance in the U.S. (because doctor’s fees and hospital visits are much cheaper). Health insurance here is very affordable.  Prices for prescription drugs are low as well, because manufacturers price them for the market. Plus, some drugs that require a prescription elsewhere are available over the counter.  There is a brand new state of the art IBT Group General Hospital, “Anita Moreno General Hospital” going into service in 2014 in nearby Los Santos (town).  See photos.

Panama Hospitals Panama City Hospitals

Johns Hopkins Hospital Punta Pacifica in Panama City

Panama City

The developed infrastructure of Panama City is astounding to those who arrive anticipating Third-World conditions. Panama City boasts a tremendous skyline of high-rise buildings, including chrome and steel modern office complexes, massive hotels, and enormous apartment buildings and even Donald Trump has developed the towering Trump Ocean Club. It also means, some quaint hostels, small hotels, groovy restaurants, and other funky spots. Culturally, living in Panama means five-star restaurants, theater, symphonies, ballet, and boutiques and rock and jazz concerts, movies, a film festival, shopping for almost anything you want in one of 3 gigantic malls, nightclubs and other city fun.

Panama City growing taller and wider.

Panama City growing taller and wider.

Safety

Panama is a safe country where you may actually live safer than you might in large U.S. cities.  Generally, Panamanians are very welcoming to foreigners living in their country, so expats usually experience an easy transition when they move to Panama.  Drug use is both unpopular and largely unavailable in Panama and drug related petty crime is non-existent where we are and in most of the country.  You can still leave your sandals and sunglasses on the beach and surf boards on the porch in Cambutal without thinking much about it, at the time of writing.

Domestic Help

If you are seeking help in and around your home or even are considering full time help, Panama is very affordable.  Rates for any help, whether it is landscaping, housekeep ing, and other temp or full time employees run between $10 and $25 per day.

Development Tax Incentives

The Tourism Authority of Panama (ATP) has agreed to reduce from one million dollars to $250,000 the minimum amount of investment required to obtain tax incentives when building a hotel outside the district of Panama.  The proposed law states that tourism projects located outside the district of Panama will be exempt from payment of import duty on the entry of raw materials, fittings and equipment used in the construction and operation of the project until 2020.  Similarly, they are also exempt from paying property tax on land used for tourism and the improvements made to it.

Residency and Work Permits.

At this time, it is relatively easy to establish “Residency” in Panama for people from one of the 24 identified preferred countries.  The requirements are that you have at least $5000 in a bank account in your name and that you either own real estate in your name or that you set up a corporation and obtain a business license.  Additionally to obtain a work permit as a professional, you need only provide a letter for employment.  The intention of this is that to make it easier for skilled labor to come to work in Panama to address a growing shortage.

happy people

Happy People in Panama.