Welcome to another edition of the Panama Weekly News Roundup. It’s almost Christmas here in Panama (and everywhere else) and, alongside the festivities of the season, the republic will be celebrating 101 years of the Panama Canal’s existence. This week we cover: why Panama is one of the best cities for doing business in Latin America, retiring in Panama as an ever attractive option, U.S. exporters keen to help out the Panama Canal expansion, and increased funding for Tocumen International Airport. We also added in one of our informational lists, detailing 14 reasons why Panama is perfect for retirees to live and invest in.
Read on to get to the real bones of the best stories coming out of the Republic of Panama this week, in our Weekly Offshore roundup from the isthmus!
Tocumen Airport Changing the Rules
The importance of Tocumen International Airport to the financial makeup of Panama was underscored yesterday by the signing of a new bill, intended to create a futuristic “airport city” around Panama’s largest airport. The injection of a huge amount of cash into the area over a 7 year period will be overseen by departing President Ricardo Martinelli, having been passed without opposition. The new development will be a boon to the region east of the capital, with construction and service jobs in the local area expected to shoot up – as well as rejuvenating interest from external investors and franchises.
“The development includes a new facility that will double the capacity of current passengers and will cost $936 million, according to the clauses included in the contract between Tocumen, SA and construction company Norberto Odebretch. Around the terminal a complex of business, conventions and tourism will be created, called airport city, which will invest about $400 million in infrastructure alone.
Bill 688, which allows the government to appoint Ricardo Martinelli CEO and President of the Board for a further period of seven years, was approved on second reading yesterday.”
Source: La Prensa
Rankings 2013: The Best Cities for Doing Business in Latin America
Panama has accelerated up the index list of cities in which to do business, beating Buenos Aires and Rio de Janeiro by being cited as the 5th best city in Latin America to negotiate, hustle, and put pen to paper. The report pins the credit to Panama’s business-friendly government and excellent location between North and South America, as well as ongoing attempts to woo investors with infrastructure improvements and tax-incentives.
“The Canal is renewed, the country goes: Panama City (5th) beat Buenos Aires (6th) and Rio de Janeiro (7th), driven by its strategic geographical location. Today is the free trade area with the second highest volume of trade, after Hong Kong. And as an international banking center, foreign direct investment reached $3,000 million in the past two years. All this meant that its economy grew 10.7% in 2012, rising two places in the ranking. Good omens, prior to the reopening of the Panama Canal in 2014.”
Source: America Economia
101 Years After Its Birth, The Panama Canal is on the Verge of Creating a Huge New Opportunity for US Exporters
Celebrating its centennial year in 2013, the Panama Canal has come to be far more important than even its original architects could predict. Fuelling the growth of Latin America’s latest success story, the “big ditch” is also key to American economic indicators reaching skyward rather than plummeting. This is evidenced in agriculture and technology exports especially, with the Canal helping to reinforce the not-inconsiderable strength of U.S. exporters. With the expansion of the canal in 2014, it is expected that U.S. exporters will increasingly view the Canal as key to their success internationally.
“The U.S. agriculture sector stands to gain the most from the expansion, further entrenching America as the world’s breadbasket (we’re already No. 1 in wheat, corn and soybeans exports). In a 2011 report prepared for the U.S. soybean industry, Informa Economics forecast that volumes of grain and soybeans transiting the Panama Canal will jump 30% or 426 million bushels (or 11.2 million metric tons) to 1,840 million bushels (the equivalent of 48.4 million metric tons) by 2020/21 from the projected volumes for 2011/12.
It’s already $6 per metric ton cheaper for farmers in the country’s midsection to ship their goods down the Missisippi River down through the Gulf than to ship them out through Seattle. Once the expansion is finished, vessels will be capable of handling an additional 7,000 metric tons on a Panamax or 13,300 metric tons on a small Capesize vessel. As a result, the area of farms who can take advantage of traveling down the Mississippi through to the Gulf instead of using freight trains to the West Coast will be able to expand, Informa says, while putting pressure on freight train companies to lower their rates.”
Source: Business Insider
Retirement in Panama is Getting Better
Delivering a fact focused and economy-centered analysis, we particularly liked this review of Panama’s appeal to retirees. The region is renowned already for its appeal to pensionados and the increasing economic diversity and expansion of the region means that, for those with money to invest in property and businesses, Panama is the perfect place to start your retirement journey.
“Panama has the fastest-growing economy in the Americas. The Panamanian economy is, simply, in a different league than that of any other country in this part of the world. It has grown every one of the past dozen years, including in 2008 and 2009.
Money is pouring into this country from elsewhere in the region and North America, Europe, Russia, China and the Middle East. Foreign direct investment inflows into this country reached $1.7 billion in 2009 and $3 billion in 2011. Big companies from around the world are taking advantage of Panama’s open-door policies and incentive programs including Maersk Line, Halliburton, P&G, Dell, Caterpillar and Sinopec.”
Source: US News
14 Reasons Why Panama is the Best Place to Retire and Invest
We ALSO believe in Panama’s current prowess as the region’s best place to retire and invest, with this article written by our staff highlighting 14 (14!) of the main reasons why you should put your money into Panama.
“Panama Retirement Visa: Panama has the most liberal immigration visa program for pensioners and retirees in the entire Western Hemisphere and maybe in the world. Panama only requires a lifetime monthly pension or annuity of a minimum of $1,000 USD per married couple from a variety of sources and no age restrictions. On top of that, various discounts of up to 50% are available at hotels, restaurants, movie theatres, entertainment (concerts, sporting events, and plays), pharmacies, local airlines, medical consultations, and utility bills.
Natural Paradise: Panama boasts some of the best bird watching, sports fishing, surfing, hiking, and adventurous traveling in the world.”
Read more about Why Panama is the Best Place to Retire
Law Shielding the “Millionaire’s Business”
Questions have been raised about the passing of the above-mentioned bill 688, regulating the development of air transport in Panama. Under the new law a raft of protections for businesses and their contracts have been introduced, with President Martinelli personally overseeing the major commissioned projects of Tocumen Airport and the so-called “airport city”. The law is seen as a huge economic boost for the region, with the airport providing Panama the infrastructure required to channel all air traffic between North and South America. Still, these questions of transparency and the government’s close involvement with select businesses remain.
“The full National Assembly approved on second reading the bill 688 which makes the regulatory framework for the management of airports and airfields in Panama, and would extend the period to seven years management CEO Tocumen, SA and between two and seven years tenure of the members of the board of the state society.
The approval of this document was in just five minutes, after a long hiatus and 45 minutes in which deputies and general manager of Tocumen, SA, Juan Carlos Pino, in the company of the airport advisory entity, talked pleasantly, waiting to receive a package of amendments to the legislative proposal of the Minister of Economy and Finance and legal representative of Tocumen, SA, Frank De Lima.”
Source: La Prensa
Free Downloadable Ebook – Panama Business Handbook
Put together by our legal team at International Relocation Firm, the Panama Business Handbook is part of a series of ebooks written on topics relevant to our readers. We are aiming to provide expats and investors with the information they need, for free! Our main focus this week is successfully starting, owning and running a business in Panama – especially if you’re new to the way of doing business here.
They include such titles as –
We have packed each ebook with detail, providing you with the introductory legal assistance you need for potentially making the decision to make Panama your base of operations. Follow the links above to download your ebooks now!
