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Panama black on white or, better,
Panama in numbers |
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Have you asked yourself why personalities like Donald Trump
put their eyes on Panama to launch, for example, the Trump
Ocean Club International Hotel & Tower project, or why Carlos
Slim Helú _ the richest man in Latin America, according to the
most recent Forbes ranking – is making millionaire investments
in the isthmus?
Has the curiosity still not appeared in you to know why, since
two years, Panama has seen an avalanche of immigrants arrive,
which made many look upon this magnifcent country and ask
themselves if the rumor that the isthmus was the ideal place to live,
retire or escape the cold during the raw winter months of Canada,
the USA and Europe was correct and not one more of the panaceas
that man searches for always in desperation?. |
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resources in the country, which is reflected in the growth of visitors... |
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The migratory wave towards Panama started with a few recent
arrivals, who began settling in this small Central American
country, and who attracted more people with the passing of the
months. Now the phenomenon has awakened the curiosity of
many others who, accustomed to look with a vigilant eye at those
who know where to invest, to improve their credit with minimum
risk and maximum gain, asked themselves: what guarantees
does the isthmus offer the tycoons to, for example, not doubt
to invest numbers such as 220 million dollars in works like the
Trump Ocean Club International Hotel & Tower, which will be
built in the capital?
The analysis evidences with dazzling clarity some of what could
be their reasons: since the extradition of general Noriega, Panama
has been changing with giant steps. Now it has a good reputation
in security matters, which improved with the strengthening of
democracy; this government option offers a stable and safe
political environment, very different from some of the neighboring
countries to the South. To this add a policy of open doors towards
foreign investment, represented in fiscal benefits, the dollar as
circulating currency, a solid banking system with a recognizedtrajectory, thus making it an interesting country for investors in many
aspects.
According to the 2007 report by the Contraloría de la República
(General Comptroller’s Office)*, the performance of the Panamanian
economy shows interesting statistics, of which we point out some:
During 2007, the production of goods and services in the Panamanian
economy, measured from the Gross Domestic Product (GDP), presented
a growth of 11.2% with respect to the previous year. The GDP valued
at constant 1996 prices registered, according to calculations by the
Dirección de Estadística y Censo (Statistics and Census Bureau), B/.
16.966 billion in 2007, which corresponds to an annual increase of B/.
1.71 billion. This dynamism, which the national economy continues to
show, was reflected in the increase of all economic activity categories,
except fishing. |
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de recursos en el país, lo cual se ve reflejado en el aumento de visitantes... |
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Activities related to the external sector continued the great dynamism
of the last years, of which stood out the ports, air transportation,
tourism, non-traditional fruit exports, the Colon Free Zone and,
to a lesser degree, the Panama Canal. In the internal sector good
growth continued in the building industry, banking activities,
telecommunications, wholesale commerce, mines and quarries, and
farming activities such as sorghum culture, horse, pigs and chicken
breeding.
Tourism has become an important activity for the generation of
resources in the country, which is reflected in the growth of visitors and
favors the increase in income that contributes to economic growth.
During 2007, visitors left income in the amount of B/. 1,848.8 million;
number which compared to 2006 reveals a 23.4% growth, attributable,
among other factors, to the events that are happening in the diverse
tourist attractions offered by the country, as well as tourism promotion
abroad. |
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The yearly added value of the building industry presented a 19.6%
joint increase, made up of the market production of the construction
works which increased 19.8% and by the construction for final self-use,
which reported a 15.5% growth. Sustained growth of the sector is an
effect of execution of public and private investments in residential and
non-residential projects, and other works of civil engineering, which
include works of the second phase of the northern beltway, advances in
the construction of the second portion of the Panama-Colon highway,
investments made by the Panama Canal Authority, the projects for
the extension and rehabilitation of road structures, which are being
done by the government, and the expansion of the main ports of the
country. Of the more important indicators linked to this activity, the
building permits increased by 29.3% and the production of pre-mixed
concrete by 15.6%.
The wholesale commercial activity developed in the Colon Free Zone
grew by 5.1%, boosted by the increase in demand coming from Central
and South America. In 2007, the commercial movement of companies
located in the Colon Free Zone reached values above B/. 16 billion, broke
down into B/. 7.7 billions in imports and B/. 8.5 billion in re-exports.
The financial intermediary category showed an 18.7% increase,
explained by the high performance of banking activities, and savings
and credit coops (another type of monetary intermediation), which
rose by 21.5%.
With respect to the population that declared to be occupied, 65.3%
indicated they were employed, 26.4% were self-employed, 5.2% were
a family worker and 3.1% were the boss. Of the 886,297 occupied
persons, registered as employed, 89.5% corresponds to the private
enterprise and government. When comparing with August 2006, it
can be observed that the largest increase happens in the private sector
and government, with 57,613 and 12,892 occupied, respectively. With
reference to the total unemployment rate, a decrease in relation to August 2006 is observed, and this indicator changed from 8.7%
to 6.4%. |
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During 2007 the social expense reached B/. 1,832.7 million, which
when compared to the previous year, registered a B/. 279.8 million
increase, corresponding to an 18% increase. On the evolution of
expenses, education and communal services have had a growing
participation in the last years. Such that for 2007 the numbers
reached B/. 770.9 and B/. 527.9 million, respectively. The execution
of expense in education represented 42.1% of the total social
expense, communal services 28.8%, health 26.6% and housing
costs 2.5%.
The central government’s total income in 2007 was B/. 3,804.6
million, amount larger by B/. 618.1 million (19.4%), with respect
to B/. 3,186.6 million collected during the same period in 2006 The
central government’s total expenses reflected a B/.413.8 million
increase, which is 13.1% with respect to 2006. The current expenses increased by B/.52.3 million and the capital expenses by B/.361.4
million; that is, 1.9% and 83.2% respectively. In current expenses,
the most signi cant item was personal services, which increased
by B/.72.9 million; that is, 7.9%.
Although the public debt exceeds B/.10,470.6 million, Standard & Poor’s made it known recently that they have raised Panama’s
long term debt quali cation from “BB” to “BB+”, reafirming the
qualification of “B” over the short term debt, based on the growing
economy and on better fiscal indicators. |
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With all the above, and although some statistics are worrying,
Panama is considered by many as the Switzerland of South
America, because it offers long term guarantees to investors and
for this same reason moves considerable amounts of money. But
Panama is not only finances; for the most common and current
person interested in living in the country, who could care less
about the statistics and numbers, Panama offers a rich and varied surrounding in its geography, landscape, ethnic groups, diverse
cultures that populate it, after many generations of immigrants.
Can the economy be improved by the mega projects like the
expansion of the Panama Canal – with an investment calculated
in more the 5 billion dollars in the next eight years –, the millionaire
investments in real estate, the diversification of the economy
and the growing of so called chimney industry, among others,
and, together with a healthy management of the finances on
the part of the government, reduce the fiscal deficit? This answer
will be received in the following years; for now we are left only to
find the way to reduce the high poverty index, which affiicts an
important percentage of the population; this index is worrisome
and although it is more than announced, it seems like a secret of
which very few want to be made responsible for; a consequence
of this “collective blindness” is that growth of the country in the
coming years could be visibly slowed down. |
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ethnic groups, diverse cultures that populate it, after many generations of immigrants... |
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To settle in Panama allows one to enjoy different climates: those
who long for a benevolent climate (20°C) are well advised to look
for dwellings in the mountainous zones: Cerro Campana, Altos
de Sorá or El Valle de Antón, Boquete, Volcán or Cerropunta, for
example. If on the contrary, they are sun and heat lovers, the country offers, in addition to the capital, many options to settle
in areas of exuberant landscapes, be it on the Pacifc coast or on
the Caribbean coast; in any of these places the cost of living is
lower than what foreigners are normally accustomed to, having
privileges like dwelling or recreational places with a view to the
beach, close to it or even on an island paradise. Finally, from each
recent arrival depends that the country does not submerge itself
in an inflationary escalade; if one does not respect the customs
and locally established fees for considering them too “cheap”, an
inflationary phenomenon will go off which is already starting to
make a dent in the local economy. |
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Historically, Panama has offered itself as a destination which
has received the foreigners who want to prosper in this land with
amiability and a ability. An example of it are the large colonies of
Hebrews, Hindustanis, Arabs, North Americans, Greeks, Spaniards,
Colombians, Venezuelans and all others which have settled in the
country coming after a dream and have managed to make it come
true by creating successful companies that are job generators.
Remember, however, that every dream has a cost, and although
Panama, compared with many other Latin American countries,
has airs of paradise, take into account that when one emigrates to settle in another environment and other lands, one cannot forget
the fact that everything can be very di erent; when arriving in
Panama, remember the Panamanians have their way of doing
things, a slow rhythm different from the frenzy that sometimes
is brought by the foreigners; don’t intend to impose, dictate or
establish routines which would result in being onerous and heavy
for the Panamanian, always keep in mind that you as a foreigner
are “a guest in someone else’s home”, and therefore the gentleness
and the education understood as the respect for the place that
welcomes you are priorities. As the proverb says: “Wherever you
go, do as you see”; this will facilitate the adaptation process to the
multiple cultural di erences and will avoid unnecessary friction
and disgust for you and the locals.
What will destiny hold for you if you decide to invest or settle here?
The answer is closely linked to your assertiveness, your tenacity,
your patience, your adaptability and your knowledge, because
Panama is a country which still has a lot to do and, if you want,
you could become a doer to prosper this promised land, where
life moves on serenely and the opportunities belong to who can
see them and work. |
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| *Statistical sources: www.contraloria.gob.pa/archivos_informesdelc/InformeContralor2007/intro.htm |
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