The premier modern-day trading route, Panama, with its strategic geographic position and its Canal, is an increasingly important point on the world map. You name it...it passes through Panama in some way at some time going somewhere. Largely as a result of its crossroads positioning...but also thanks to its reputation worldwide as a top retirement, offshore, and banking haven...Panama is one of the fastest-growing countries in the world...and the fastest-growing market in the region. The country's economy grew by 11.2% in 2007 and is projected to grow by a further 9% at least in 2008.
Panama City, especially, is showing signs of strain, thanks to the pressures accompanying all this rapid growth. But the Panamanians are working hard to improve their infrastructure to keep up.
Meantime, be you in the market for a new home or a good investment, Panama should be at the very top of your list. The secret is to understand that Panama is not one market, but many. Panama City, for example, is over-priced, over-hyped, and over-played. Now is not the time to shop for a pre-construction buy in one of this city's many high-rise aparmtent towers, for example.
Boquete, too, in the country's highlands, is too known and too pricey for our tastes.
Best buy in the country today? Pacific beachfront well beyond the capital city, in particular along both the east and (thinking earlier-in and offering the potential for a bigger pay-off longer term) the west coast of the country's Azuero Peninsula.
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Panama at a Glance
Population
3.3 million (July 2007)
Gross Domestic Product (GDP)
$29.14 billion (2007)
GDP Per Capita
$9,000 (2007)
Inflation Rate
5.1% (2007)
Currency
U.S. Dollar (and also the Balboa)
Exchange Rate Versus U.S. Dollar
1 Balboa = 1 U.S. Dollar
Language
Spanish (official), English (14%)
Capital
Panama City
Population of Capital City
1 million (2007)
Time Zone
GMT minus 5
Seasons
Tropical; rainy season lasts from May to January
International Dialing Code
507
Electricity
110V (Panama City 120V)/60 Hz; Plug Types: A, B (US style)
System of Government
Constitutional Democracy
Name and Party Affiliation of Current Leader
President Martin Torrijos DemocraticRevolutionary Party
Income Tax Rate for Residents
0% to 27%
Property Tax
0% for first 20 years, 0% to 2.1% thereafter
Capital Gains Tax
10%
Inheritance Tax
0%
Rental Income Tax
0% for first 15 years in designated areas, 15% thereafter for non-residents; taxed at income tax rate for residents
Transfer Tax
2%, paid by seller
Sales Tax
5%
Restrictions on Foreign Ownership of Property
None
Local Chamber of Commerce
www.panacamara.com Edificio Cámara de Comercio, Industrias y Agricultura de Panamá Panama City Tel: (507) 227-1233
American Chamber of Commerce
www.panamcham.com P.O. Box 0843-00152 Panama City Tel: (507) 301- 3881
Primary Exports
bananas, shrimp, sugar, coffee, clothing
Residency and Visa Requirements
Tourist: 90 days Residency: pensionado, person of means, investor, forestry investor, small business investor Citizenship: after 5 years of legal residence and full immigrant status
Special Benefits for Foreign Residents or Retirees
Pensionado Program: tax free import of home goods; tax free importation of a vehicle every two years; 50% reduction on home loan closing cost; 25% discount utilities; 50% off all entertainment; 25 to 50% off goods and services from airline tickets to health care
