Panama’s business environment presents a favorable image to foreign and local investors alike. Panama City the principal commercial center followed by the Colon Free Trade Zone. Panamanian economy has experienced very dynamic growth in the past years, after suffering setbacks brought by the Noriega administration and the sluggish growth in 2000 2002. Industries behind this dynamic growth are transportation (including the Panama Canal, the container transshipment ports, railroads, air transport and domestic passengers and cargo transportation), the Colon Free Trade Zone, construction, wholesale and retail trade, restaurants and hotels, communications, financial intermediation and real estate activities.
Doing business in Panama is convenient because Panama uses the U.S. dollar as its legal tender, the balboa (the Panamanian currency) being interchangeable with it. Since there are no valuation/conversion concerns, it has practically eliminated current exchange risks for US dollar based companies. There are also no restrictions on funds transfer in and out of the country, which makes it easy to invest and divest. Business hours are 8:00am 6:00 pm, with 1˝ hours for lunch period, weekdays. Government office hours vary so check prior to visiting. All Offices and commercial businesses are closed on days of national mourning. In terms of labor force, Panama has a rich source of manpower. Literacy rate is 90 percent, many Panamanians being bilingual. Panama’s inflation rate is relatively low and almost always mirrors that of the US, though always below it. Doing business in Panama is virtually tax free due to its territorial method of taxation (only income made within the country is subject to Panamanian tax) and no reporting requirements or taxes are imposed. Doing business in Panama is favored by foreign corporations because of its flexible company laws, which include no restrictions on 100 percent foreign owned companies and no restrictions on mergers, acquisitions, or joint ventures. Doing business in Panama is straightforward because of the country’s equal treatment of foreign and local citizens alike.
Doing business in Panama is amply supported by its transportation and telecommunications infrastructure. Panama’s modern railroad is extensive and is used both for cargo and passengers transportation. Panama has a highway network of asphalted concrete roads, with 27 public and 41 private airports. Together with the Panama Canal, Panama is a multimodal transportation center. Telecommunications facilities include cellular phone networks, fixed phones and the Internet. Real estate is affordable and extensive. Doing business in Panama is almost worry free because it has one of the best access to capital. Its banking industry is known as the “Switzerland of Latin America,” a fitting name because it rivals Switzerland in modernity and security. Panama is a peaceful country with no military and where personal security concerns are limited. It is a member of the World Trade Organization and it has free trade and limited trade agreements with countries in Asia, the Americas and in Europe.
With the favorable business environment, it is no wonder that Panama is one of the most favored investment destinations in Latin America. Panama welcomes all investors to come see the country and enjoy its natural riches, while doing great business.
Author Resource:-
Laurie Cooper, of Cpanama Real Estate Corp., is an expert on Panama real estate. For more information, please visit http://www.cpanama.com.
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