In 2008, I took my leave from the publishing company where I’d been working for 23 years. I was 45 years old and living in Paris.
I spent the next three months exploring that city on foot, early to late each day, and got to know Paris well.
I also learned that three months is my limit for doing nothing, even in Paris, and returned home from a long walk one afternoon to announce to my husband that I wanted to start a business of my own.
“We’ll need to leave Paris,” he replied without looking up from his laptop.
I knew he was right. France is no place to build a business. This country does not value entrepreneurs, and running a business here is expensive and hassled. Labor law and the French perspective make every employer the enemy, and French taxes can take half of every dollar your business earns.
We were in a fortunately very flexible position at the time, able to move anywhere, so, as much as we loved living in Paris, the question became:
If France is among the worst places in the world to invest in a business, where would be among the best?
By this time, my husband and I had managed businesses in eight countries.
Based on that experience, I made a list of things important to the expat entrepreneur, as follows:
- Quality and cost of infrastructure, especially Internet and banking
- Quality, availability, and cost of English-speaking labor
- The country’s approach to taxation
- The current administration’s perspective on foreign business and foreign investment
- Residency and work permit options
- Cost of doing business, especially office rent
- Ease of setting up a company
- Stability of the local currency (if other than the U.S. dollar)
- Time zone relative to the business’ intended marketplace
- Local labor law
- Local standard of living
I considered the countries I knew from experience and others, too, in the context of these 11 questions, and one stood out—Panama.
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Why Panama Is A Great Place For Entrepreneurs
Panama as a whole is a safe, stable, affordable country that uses the U.S. dollar as its currency, meaning no exchange-rate risk. The standard of living is comfortable, even luxury-level if your budget stretches to allow for it.
Those things, though, are true for other places that could also make sense for the would-be entrepreneur, including in Latin America but also in Europe and Asia.
Panama’s trump card is the approach it takes to taxation, both personal and corporate. It’s possible to live and run a business you own in Panama, paying little in taxes, even if you’re an American. The list of places around the world where that is true is short.
I’m speaking of legal and compliant strategies. It’s not difficult to organize, but you need competent advice from a tax expert who understands both Panama’s approach to taxing corporate income and the obligations to Uncle Sam of an American living and earning money in another country. Probably, really, you need two tax experts, as finding one who understands both sides of this tax picture will be near impossible.
Because I understood Panama’s tax advantages, this country rose quickly to the top of my where-should-I-locate-the-business list.
Some 13 years ago, I considered the whole world map and chose to base my Live And Invest Overseas business in Panama.
Would I make the same decision today?
This country is as entrepreneur-friendly as you’ll find and remains a land of opportunity for anyone looking to reinvent him- (or her-) self and earn an income at the same time.
Founding Publisher, Overseas Opportunity Letter