Panama has long won a reputation for being a great place to invest and do business. It has been the highest growing economy in the region, with a 7.57% average annual growth between 2005 and 2015. This is more than double the average in Latin America and the Caribbean (3.03%).
Its strategic location gives the country a competitive advantage. It is easy to fly into Panama because of Tocumen its international airport known as the “Hub of the Americas”. 16 direct flights connect Panama to the United States and Canada. 81 international destinations worldwide, including direct flights to Istanbul, Frankfurt, Paris, Madrid and Amsterdam in Europe.
About 8% of the world’s trade passes through the Panama Canal and most locations in the Americas can be reached within 10 sail days. 144 maritime routes reach 1700 ports in 160 countries.
Panama is home to Latin America’s two most active ports, one on the Pacific and one in the Atlantic. The country ranks #5 worldwide for port infrastructure. IMF estimates the new Canal expansion will reduce global maritime shipping costs by US$8 billion per year.
Panama depends on foreign direct investment. Inward FDI flows in Panama totaled US$5.209 billion in 2016. Panama received more than 43% of all FDI in Central America in 2015. And it is the country in the region with the most FDI (9.67%). Over 260 multinationals have established here with the favorable laws.
Taxes are also quite low compared to the region. 7% sales tax in Panama is the lowest in Latin America. The corporate tax of 25% is also less than the norm.
It is better to have a local contact
There are many reasons to do business in Panama, but like any other place in the world who you know will open many doors. Things move slower in the tropics and the “mañana” mentality might frustrate people not used to it. In order to be successful you must have the right contacts and be persistent.
Having a local connection like myself with business and political ties can help make your business trip a lot easier and more profitable.
Please contact me to set up a business travel proposal.