MIAMI IS OUT PANAMA IS IN

Miami is out and Panama is in
Simon Black, international traveler and investor, has written an article about how investment is and will continue to move out of Miami and seek another home. He list a number of options, but ends up selecting Panama for a many reasons. An interesting article with an interesting take on our world in Panama.
The Capital of Latin America
Simon Black
For Latin Americans, Miami has been a lot of things– the major financial center, the cultural Mecca, prime tourist destination, the business capital, and a symbol of international success.
The city made its riches and opportunities available to all nationalities, reaching the point during the most recent real estate boom where one could become financially successful and never speak a word of English.
Truly, Miami was a frontier island between North and South, sort of a Hong Kong of the Americas, infusing business savvy and capital with cheap labor and an extraordinarily large market.
The fact that Miami is so close to the United States and participated in the US banking system (the world’s #1 tax haven for non-US citizens) was a major benefit to individuals and businesses.
Naturally this is all changing now.
Read the rest of the story at The international Man website.
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Imprescindibles cambios en Tocumen

Múltiples crónicas hemos consagrado a través de los años al tema del desenvolvimiento profesional de nuestro aeródromo principal. Muy a pesar de los positivos cambios realizados, la tarea nunca termina. Al contrario, se convierte en un continuo reto al sentido común y la evolución de incesantes transiciones, ecos de nuestro mundo moderno.
Si bien es cierto, se elimino el desordenado mercado de buhonerías existente durante el quinquenio anterior, la Administración Torrijos procedió a crear un cuasi monopolio en la zona libre que afecta la venta de productos claves en el aeródromo a favor del expendio de productos típicos del ambiente duty-free como licores y tabaco, perfumería, ropa, electrónicos y joyería.
Recientemente fuimos cortésmente acogidos por Graciela Gutiérrez, funcionaria con tres décadas de servicio a la institución, en el kiosco que la Autoridad de Turismo ha ubicado frente a la puerta de embarque # 22 en la zona franca. Nos explicó Graciela que allí se ofrecen fascículos por provincia en castellano e ingles. Posterior a un lógico análisis, me pregunto si un turista reconoce la diferencia entre Darién y Los Santos como para escoger el correspondiente cuadernillo. Es como viajar a Guatemala y recibir opciones de catálogos de Huehuetenango o Jutiapa ¿No sería mejor ofrecer un Panamá Pack que ofrezca el ramillete completo de la oferta turística disponible, incluyendo la opción en formato CD multilingüe para la gran mayoría de los visitantes que viajan con sus computadoras personales?
Interrumpió súbitamente nuestra entrevista una frustrada pasajera Sudamericana que nos expuso que había recorrido íntegramente la terminal en busca de una tienda de artesanías. Algo anda mal cuando vendemos Marlboro, Cartier y Sony pero no molas, sombreros Panamá ni taguas.
Algo anda bien mal cuando no hay un solo puesto de expendio de libros y periódicos, negocios harto típicos de aeropuertos en todas las latitudes. ¿Reflejo tal vez de nuestra indiferencia por la lectura o resultado del cuasi monopolio? Algo anda supremamente mal cuando después de ganar el galardón como el mejor café del mundo consecutivamente por un lustro, no hay ningún sitio en la terminal donde se promocionen y se vendan nuestros cafeses acompañados del cintillo #1 Coffee in the World.
Nos jactamos de nuestras virtudes comerciales, pero contamos con un solo restaurante en la zona franca que peca por su pésimo servicio, exagerados precios y su limitado menú. ¿Quien ha sido beneficiado por este monopolio durante las últimas tres décadas?
Según el Reporte Estadístico 2008 de Tocumen, un total de 4,549,170 pasajeros que se trasladan a 54 diferentes destinos utilizaron la principal terminal aeroportuaria del país. De estos, 1,505,324 desembarcaron en Panamá. Gozando de tantos espacios disponibles ¿no sería beneficioso para el istmo venderse a esa audiencia cautiva de más de 3 millones de pasajeros que pululan anualmente sus pasadizos?
Si lográsemos la distribución masiva de material publicitario de optima calidad y la decoración del terminal con impactantes pautas de nuestra gran oferta turística, desde los records mundiales de pesca fuera de borda, la diversidad de las playas Caribeñas y de la Riviera Pacifica, nuestras numerosas islas, tierras altas, la capital más moderna y hermosa de Latinoamérica con su imponente Cinta Costera y Casco Antiguo, el Canal, las bondades de Coiba y Kuna Yala, el verdor del Darién y el Museo de Diversidad, entre otros, abriría el extraordinario apetito de los transeúntes hacia un turismo diferente y variado. ¿Se imagina el amable lector el efecto multiplicador que tendría en nuestra economía si lográsemos que un ínfimo porcentaje, por ejemplo, trescientos mil turistas adicionales o menos del 10% de los transeúntes, regresaran a Panamá? Sería un negocio redondo y jugoso para el país, sobre todo en estos momentos de incertidumbre y crisis financiera mundial.
Vale entonces la pena explotar al máximo Tocumen, ese fabuloso diamante sin pulir. Enhorabuena, ¿Qué estamos esperando? El autor es especialista en turismo.

Courtesy of: Panama Real Estate & Investment

Panama Going Strong Against All Odds

It seems as if Panama was a country totally independent to the rest of the world; while other countries are restraining investment, managing the world crisis and its effects, low tourism, imports, exports, investments as a whole, this small but fast growing economy and beautifull country.

Come and be a part of it!

Visit Panama

FORESTAL INVESTMENT IN PANAMA

When I first came to Panama in 1995, I was involved in a number of reforestation programs in the central provinces of Panama; most were run by the Panamanian government and focused on reforesting denuded, barren fields that had once been dense rainforest. We planted Caribbean Pines and some Teak, but few native species of trees. While working in these reforestation projects, I realized very clearly that the process of deforestation in Panama, as with most tropical countries, is a human induced ecological problem. The cycle went like this: A population of farmers from an already exhausted environment moved into a jungle area, cut down large trees and then burned the forest to make agricultural fields. After burning all the vegetation, the land was used in a long fallow agricultural system: the land was used for two or three years and then was left to return to high forest for 10 to 12 years. But over time as the population grew and more food was needed the fallow, or resting period, was shorten until farmers were using their land every year or every two years. At some point the land became useless for agriculture; at this point, most of the land was turned into cattle pasture.
The turning of the land into cattle pasture meant the quality of the soil was further degraded – at some point the land wasn’t even good enough for cattle grazing and was abandoned and became known as cerro – useless land.
Futuro Forestal is trying to stop and reverse this process. What Futuro Forestal is emphasizing in their tree plantations is diversification on each plot in order to protect their investment and encourage biodiversity - a good policy. Futuro Forestal is also experimenting with about 50 other native and exotic species. Basically, Futuro Forestal buys the seeds from government centers (IDIAP is the government agency) and then starts the trees off at their nursery for the first 4 months or so. Sites are prepared, including digging a 1 m planting hole, which is filled with their special organic soil mix. Once the rainfall pattern is stable (May, June), the seedling is then transplanted in this medium, and it literally takes off! Visiting the various plots and seeing the growth heights of the species and then being told their age, you can’t help but be astonished.
Futuro Forestal: Investing In Reforestation
Futuro Forestal is a private German-Panamanian Reforestation and Forest Services Company that has spent the last 11 years developing and refining an innovative investment model based on ecologically and socially sustainable reforestation in the tropics. Futuro Forestal offers investors the chance to own a forest that produces high yield, fine tropical hardwoods. The sale of the wood, seeds, as well as carbon credits enables the savvy investor to make a substantial profit while contributing to a socially and environmentally sustainable project. Investors receive fully titled land, planted with up to seven species of valuable tropical hardwoods, AND the forestry services of Futuro Forestal for 25 years. Profits of 6-11% IRR can be obtained on a 25 year term. The company works closely with the Smithsonian Institute in Panama as well as the Yale School of Forestry and Environmental Studies and the University of Panama; it is FSC (Forest Stewardship Council) certified. The project is also being monitored by the Panamanian Environmental Authority ANAM.
Futuro Forestal has recently won the Metafore Innovation Award in Portland, Oregon, for their investment product WoodStockInvest. The award recognises improved social, environmental and financial results in the area of forest products.
Futuro Forestal’s project aims to create an attractive environment for the investor and at the same time help to restore the biodiversity of Panama. Their reforestation activities take place in two areas. One is located in the Chiriqui Province in the town of Las Lajas, which is located on the Pacific Coast of Panama, about a 5-hour drive from Panama City and an hour-and-a-half drive from Boquete. Their newest reforestation project is located in the area of El Pito/Soná in the Veraguas province, where they have established their new “Finca Las Huacas”. The new Finca, specially dedicated to the Forestry Visa, offers 2 ha plots of titled land with 25 years of sustainable forestry management services for 40,000 US$ which is the minimum required by the Panamanian authorities to qualify for the Reforestation Visa.
Depending on species, after the 20-30 year growing period and silvicultural management, Futuro Forestal expects to have about 400 crop trees to harvest, with heights of around 25-35 m. Most trees will reach the incredible heights of 20m within their first 4-8 years (compare that to coastal BC where best site growth is about 2-3m!). First income will be generated with the different thinnings, which occur at year 10, 15, 18, 22. and 25. A profit can also be expected from the sale of carbon credits. After that, the key is to transfer the growth to the girth, to put on diameter growth. Thus, further thinning and fertilizer applications. Unlike in the slow-growing conditions in North America, in Las Lajas, silvicultural investment must be intensive in order to keep up with the fast growing trees. By the way, all fertilizer applications consist of 100% recycled organic by-products, such as chicken manure and sugar cane leaves.
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How To Invest And Why
Most investors in the project buy a 5 acre parcel or more – most investors invest 40,000 to 200,000 dollars in the project, most see a yearly return of 8% to 12% or more on their investment. But it is also possible to invest in smaller plots of ½ ha. After your initial investment you receive title to your land. Your land is then managed by Futuro Forestal: taking care of the trees intensively, fertilizing and executing the first thinning after approximately ten years. Thinnings will occur after years 15, 18 and 22 with the main harvest in year 25. Basically what you are doing when you invest in Futuro Forestal is investing your money in a valuable natural resource – tropical woods – that will grow in value as the demand for tropical woods grows, as it is, and as demand grows prices will rise. At the end of the 25-year cycle you will still own real estate in Panama as the land that is used to grow trees is in your name.
Security And Best Quality
There are no active volcanoes in Panama. There are no hurricanes on the Pacific side of Panama. There is no history of strong earthquakes in Panama.
Unique System of Insurance pool. More than 5 % of reforested land will be held back for investors in case of total loss.
Fire insurance for the first 5 vulnerable years
Key person-insurance with Generali (1.5 million US coverage).
Auditing through Deloitte.
FSC Certification through SmartWood (“well managed”).
Rating as No.1 Forest Investment in Latin America (SIRIREC 2004).
Risk minimization through ecological portfolio model (6 mainly native species of fine timber plus teak).
Co operations with renowned Universities such as Yale School of Forestry and Environmental Studies.
Tree guarantee: Futuro Forestal commits to replant trees which have died due to disturbed growth.
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Benefits To The Surrounding Community
Futuro Forestal is now employing 50 full-time workers and 80 seasonal workers. This has allowed families in the area to stay in Las Lajas and not migrate out of the region to Panama City or to the regional capital of David. The project has also helped farmers in the area learn about the benefits of reforestation. Hopefully, what the farmers learn at the project will change the way they farm, specifically not to cut down or burn trees. If the farmers can see there is money in preserving the environment, then they will be able to stay on the land and not become landless urban workers who can’t feed themselves. This process of change in agricultural practices is similar to what happened in Costa Rica 30 or 40 years ago: people stopped burning, stopped migrating to the city, and started to realize that protecting the natural environment meant food and money. Panama is just beginning this process.
Most rural farmers in Panama have a hard time making a living in the countryside, most have large families and most see their children leave the countryside and go to Panama City to look for work, so the family structure in rural Panama is breaking down because the agricultural base or natural resource base of the countryside is so depleted. If you go to the Panamanian countryside today you see mostly very old people and very young children who are left with their grandparents by young mothers who work in Panama City as domestic servants.
What I believe would be good is that people in the countryside of Panama have to find a way to reclaim land that has been destroyed because of poor agricultural practices. The first step in reclaiming denuded and barren land is reforestation, but reforestation that promotes biodiversity and not monoculture. In short, there has to be a migration from the urban areas back to the countryside and when this happens there must be some new agricultural system that is in place that will allow the population to survive on the land without destroying it. Reforestation now will help this process along later and what Futuro Forestal is doing in Las Lajas is planting the idea in the surrounding community about how to reforest and how do it in a way that is profitable and will allow people to stay together in the countryside and become prosperous farmers.
Farming was a prosperous activity in Panama in the past. Before roads were extended into the deep interior of the country, people had to produce to feed themselves. But when roads penetrated deep into the countryside, the road in became the road out and people started pouring out of the countryside to the city and when that happened agriculture and an instinct for natural resource management suffered. Food was shipped into these remote areas because of the new roads. Before the roads were cut it was difficult for people from outside these small rural communities, with names like Pan Dulce, Comensito and Agua de Salud, to reach them - they could only fly to the towns by light airplane. At that time, all the small towns had markets on Sunday at which people from the countryside and the local aristocracy bought their food - there was no food trucked in. Reforestation is the first step in improving agriculture and hopefully change people's feelings about seeing the importance of the environment as something from the dark past.
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Investing In Panama
The advantage of investing in Panama is that it has become very politically stable over the last 14 years and the U.S. has a vested interest in seeing this incredibly important country stay stable. As an investor you have the benefit of having modern services in Panama, especially modern banking services. There are over 150 banks in Panama for a country that probably has 200,000 people who could put money in the bank; in other words, there is a lot of foreign money in Panama and in order to protect the inflow of foreign money, banks have to treat investors well.
The banking laws that made Panama an offshore haven were passed by Omar Torrijos in 1970: those laws stated that there would be no tax on interest from any kind of account. Offshore business deals would be tax-free. No laws or restrictions on the setting of interest rates. Money could move in and out of the country freely. Numbered accounts rather than named accounts: Switzerland in the tropics it was called. Another reason why Panama became a banking center was the fact that the U.S. dollar is used as the national currency as well as the fact that Panama is in the same time-zone as Wall Street – making its banking hours identical to New York.

Types Of Businesses You Might Start In Panama
The place is swarming with great lawyers who are very inexpensive and for the most part honest. Now what kind of business would you want to open? A lot of people that are relocating to Panama are opening Internet based businesses, from clothes to tourism. Tourism has taken off over the last two years in Panama, though the tourist infrastructure in the country is still underdeveloped, especially the marketing of tourism. Another type of investor are those working in e-commerce, selling real estate in Panama through the Internet or shipping products out of Panama’s Duty-Free Zone to the world. For trading Panama is in an excellent position: perfect location between North and South America, there are great storage facilities in Panama as well as easy shipment of merchandise, you have a large duty-free zone from which any product can be assembled and sold in the region. Most people that trade out of Panama buy their goods in China, from China they ship merchandise to Panama’s duty-free zone and from the free zone they ship to other countries in Latin America, say, Venezuela, Costa Rica, Ecuador or wherever.
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Special Benefits For Retirees In Panama
The law outlining benefits for retirees in Panama was written in 1987, known as Ley No. 6 del 16 de junio de 1987 adjustments to that law were made in 1989 and 1992. The benefits for retirees in Panama are some of the best worldwide and certainly the best in the region. Here is a list of retiree benefits:
You can import a car into Panama every two years tax free.
Discounts on pensions, motels, or hotels.
Pay less on medical bills if not covered by insurance.
Prescribed drugs are discounted by 10%.
Airfares are discounted by as much as 25%.
Restaurants will give a discount.
30% off Public transportation.
You may import household goods worth up to $10,000 tax free.
20% off Medical services.
25% off light bills, water bills and cable bills.
No property Tax if Panama is where you own your only home.
Lawyers, Nurses, Therapists and other professions give discounts.
Home furnishings bought in Panama are tax free.
Interest rates on Commercial loans are lower for retirees.
National and foreigners are equal under the law in Panama.
50% off recreation, such as movies, sports events, ballet, parks all have a discount for retirees.
50% off Hotels.
Studying In Panama
FSU-Panama is the second oldest University in Panama. It has been operating in Panama since 1957 and offers majors in Computer Science, Environmental Studies, Information Studies, International Affairs, Interdisciplinary Program In Social Science and Latin American and Caribbean Studies. The University is located in the old U.S. Canal Zone and lies directly under the Bridge Of The Americas, the bridge that connects North America and South America. The University provides housing at a very reasonable price and tuition to the school is much less expensive than most universities in the States. Classes are in English and most students that spend their four years at the University learn Spanish. So you get Spanish as well as English as well as a U.S. recognized degree and you also stay out of the cold and get the chance to visit other countries in the region without having to travel so far.
Click Here to read more about FSU-Panama.
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Letters From People Who Have Visited Futuro Forestal
"I invested into FSC certified forestry with Futuro Forestal, because this is a smart way to combine ecological economical and social approaches in a stricken third world country. Especially the idea of reforesting in Panama as a profitable investment convinced me. I have been in Panama to see the project with my own eyes. I was impressed to see how professional the job is done there to benefit local people as well as the investor. This concept as a whole approach was important to my decision to invest and parts of my future retirement savings will be shifted into this opportunity"
Bernt Kamin Chairman of the Work Committee Seaport Hamburg
"We appreciate your practical experience with the plantation and the capacity to create a multiculture forest of primarily native species and to succeed in making the venture profitable and sustainable. We look forward to a continued positive relationship with Futuro Forestal."
John Spears, Senior Advisor, the Forest Team, and Socially Sustainable Development The World Bank in a letter to Futuro Forestal

Courtesy of:http://www.dejavuinvestment.com

PANAMA HIGHEST ECONOMIC GROWTH IN THE AMERICAS

Panama will continue to have Latin America's highest economic growth, while Mexico will have the lowest, according to a Latin Business Chronicle analysis of new data from the International Monetary Fund (IMF). All in all, Latin America is expected to increase its GDP this year by 4.4 percent, the fund said in its latest World Economic Outlook released last week. That's a slight revision upwards from the 4.3 percent GDP growth the IMF had forecast earlier. It's also better than the IMF's forecast for global growth (3.7 percent) and economic growth in the United States (0.5 percent), the European Union (1.8 percent) and newly industrialized Asian economies (3.9 percent). However, Latin America will lag areas like developing Asia, Africa, the Middle East and the Commonwealth of Independent States when it comes to GDP growth this year. (more)
Next year, Latin America's economy should grow by 3.6 percent. That will be higher than the forecasted growth in the United States and the European Union, but will lag all other areas and be slightly less than the expected global average of 3.8 percent.
Mexico, Latin America's second-largest economy, will likely expand its GDP by 2.0 percent this year and another 2.3 percent next year. That will be the slowest growth in Latin America in 2008 and 2009, our analysis shows. Mexico had the third-lowest growth last year - 3.3 percent. The 2008 growth will also be the lowest since 2003.
Brazil, Latin America's largest economy, will post GDP growth of 4.8 percent this year and 3.7 percent next year, the IMF predicts. That compares to 5.4 percent last year, which was the country’s best since 2004.
Argentina, Latin America's third-largest economy, will grow by 7.0 percent this year. That will be the second-best result in the region, along with Peru. Next year, Argentina's GDP should expand by 4.5 percent. Last year the country's economy grew by 8.7 percent.
Panama will see GDP growth of 7.7 percent this year and 7.2 percent next year. That's the highest rate in Latin America and follows Panama's growth of 11.2 percent last year, which also was the best in the region. In fact, it was also the best result in Panama's recent history, according to IMF data for the past 27 years.
Another star is Peru, which will see growth of 7.0 percent this year and 6.0 percent next year. Both are the second-best in Latin America. Last year, Peru's GDP grew by 9.0 percent, which also was the second-highest in the region and its best result in 13 years.
Among the leading losers are countries like Ecuador, El Salvador and Venezuela. Ecuador, which had the worst result last year (1.9 percent), will post the second-lowest growth this year (2.9 percent). However, it will fare better in 2009, with 4.1 percent GP growth, the IMF predicts.
El Salvador will post the second-lowest growth next year (3.4 percent). That follows an estimate 3.0 percent GDP expansion this year (Latin America's third-lowest growth) and 4.7 percent last year.
Venezuela, Latin America's fourth-largest economy, is expected to see a marked slowdown from recent years to next year. While the South American country's economy will be the fifth-best this year, it will be the third-worst next year. Venezuelan GDP will grow by a mere 3.5 percent in 2009, the IMF says. That follows an estimated 5.8 percent growth in 2008 and a more impressive 8.4 percent expansion last year.

Courtesy of: http://www.dejavuinvestment.com

Lawyers Advise in Real Estate Panama

It is a fairly common practice in Panama for a real estate brokerage firm to provide free corporations for the buyers of newly built condos. Usually they have an in-house attorney or a law firm that is an in house attorney in disguise, doing the corporations.
Well the problem is the real estate is being titled into the name of the corporation. The corporation has nominee directors, and a resident agent who is tied to the real estate company that sold you the development through their lawyer. The lawyer forming the corporation does not have an arms length relationship with the realtor and you. There is a conflict of interest not in your favor in that the realtor is the one who is paying the lawyer not you. How many condos are in that building 150-200. That is a lot of corporations for the lawyer. All the lawyer cares about is seeing that the real estate deal closes and the developer gets paid.
What if you need to start a lawsuit concerning the real estate because something was not done correctly? Now having his lawyer do the work on the corporation that owns the real estate that your hard earned money paid for does not seem like such a good idea, does it?
Second Year Fees - A decent price for second year fee is $695.00 including three nominees, resident agent, resident address and the $300 tax. Some of these law firms charge $1200 or more for the second year fees and that is how they make their money. So the free corporation may not be that free.
Free Immigration Work from Broker - Again be careful if there is a dispute over the real estate why do you want your broker or their lawyer to have involvement with your immigration case. What if a lawsuit is necessary regarding the real estate?

Courtesy of: http://www.dejavuinvestment.com

Investing in Real Estate Panama

Buying Real Estate in Panama
Q. Can foreigners own property in Panama?A. Yes. All citizens and foreigners are equal under the Panamanian Constitution. Anyone can own property in Panama. And, while not required by Panamanian law, it is advisable to establish a legal entity to buy land and engage in the building or purchase of a house.Q. Do foreigners enjoy the same property rights as Panamanian citizens?A. Yes, with one exception: foreigners cannot acquire land within 10 kilometers of the country border and on islands that have not been declared a special development area.Q. Why do so many foreigners choose to buy a second home or retirement home in Panama?A. The main reason that foreign investors have targeted Panama is cost. Property in Panama is relatively affordable. Buyers can purchase highly-desirable property in Panama for less than one half what they might pay for comparable property in the rest of the world.Buying property in Panama is safe and easy - foreigners enjoy the same property rights as Panamanians. Additionally, there is real estate readily available in Panama to suit all budgets and tastes. From a luxurious high-rise apartment, to a tropical beachfront condo, or a breezy mountain retreat, there is a perfect piece of Panama property for every type of person.Q. What makes Panama appealing besides affordable prices?A. Panama is the most North-American in makeup of any nation in Latin America. Panama has most of the conveniences found in the U.S. from Direct TV, to American movies, to excellent health care. Plus, the major cities have the amenities and comparable infrastructure to the U.S.Panama is truly a tropical paradise with almost zero violent crime and an extremely hospitable attitude toward foreigners. The country is peaceful, has a low population density and almost no pollution. It uses the U.S. dollar as currency so there is never any currency exchange issues.Whether investors just want a place where they can relax on the beach and surf in the ocean waves, or relax on a mountain top in the cool highlands, Panama has it all.Q. Why is there a sudden surge in interest in Panama property as an investment?A. Panama's recent vote to start a $6.0 billion expansion of the Panama Canal will result in a huge injection of money into Panama's economy. Canal officials say the expansion, due to be concluded in 2014, will create up to 40,000 jobs. By 2014, the Canal is expected to contribute $1.3 billion a year to the nation's treasury, up from $580 million today. The entire country will benefit, and real estate, especially property near the Canal, will likely appreciate significantly.Q. How is title to property held in Panama?A. The Republic of Panama has one of the most sophisticated Public Registry systems in the region. The Public Registry Office keeps records of all titled properties in all nine provinces of Panama.Q. Is Panama attractive to retirees?A. Panama has tried to encourage foreign investment by appealing to affluent retirees. For that reason, the requirements to own property and establish permanent residence are not nearly as onerous as in some other countries.Foreign retirees who want to make their home in Panama must get a pensioned tourist visa. This visa will include the right to import up to $10,000 worth of possessions for personal use duty-free, as well as the duty-free import of a vehicle every two years.A huge plus for retirees, both foreign and domestic, are discounts of 10%-50% at restaurants and hotels, for transportation and many medical services, and for some financial dealings.Q. What other retirement incentives are offered for foreign investors in Panama?A. Retirees are eligible for many outstanding incentives that include:
Import tax exemption for household goods
Tax exemption to import a new car every two years
25% discounts on utility bills
25% discount on airline tickets and 30% on other transportation
15% discount on loans
1% reduction of home mortgages for homes used for personal residence
20% discount on doctor's bills, 15% on hospital services if no insurance applies
15% off dental and eye exams
10% discount on medicines
20% discount on bills for professional and technical services
50% discount on entrance to movie theaters, cultural and sporting events
50% discount at hotels during Monday to Thursday, 30% on weekendsQ: Does Panama offer any tax exemptions to foreign buyers?A: Yes. This tax exemption is an exciting benefit of buying property in Panama and applies to nationals and foreigners who buy property in Panama.A major incentive to buy any property in Panama is the 20-year property tax exemption law. The law was first passed by the Panamanian government in 1990 as a way to encourage economic growth and investment. The exemption mandates that buyers of new homes or condos do not have to pay property tax for up to 20 years.In late December, 2007, Panama extended the 20-year tax emption until the end of 2009. This means buyers who close on a property before December 31, 2009 are exempt from paying property tax for 20 years. Maybe it's time to take another look at Panama properties. Of course, buyers should check with a project's developer and/or their personal accountant to ensure that this law applies to their purchase.Q. When selling real estate property, does the seller have to pay a transfer tax?A. Yes, sellers of real estate are required to pay a 2% tax for each transfer of property. Real estate transfer tax can be offset as a direct credit against the income tax levied on the capital gain arising from the sale, if any.Q. What types of property are foreign buyers purchasing in Panama?A. Foreign buyers purchase single-family homes, condominiums and also a relatively new type of real estate called condo hotels.Q. What are condo hotels and why is it becoming popular in Panama?A. The condo hotel concept has been rapidly gaining acceptance all over the world. Panama has joined in by planning to build several outstanding condo hotel resorts.The condo hotels are four- or five-star resorts offering fantastic amenities like full-service spas, fine-dining restaurants, pools, concierge services and more.These vacation homes are ideally suited for international people buying a second home because owners can use their condo hotel unit when they want.When they're not in residence, their condo can be placed in the hotel's rental program, and they will receive a share of the revenue it generates.Plus, the hotel takes care of cleaning and maintaining the property, operating its many amenities, and promoting it to attract hotel guests. It is hassle-free second home ownership at its best.Q. Are Panama condo hotels appropriate for retirees?A. Yes, they're an excellent solution for retirees who may want to spend a few weeks or months a year in a warm climate and a resort atmosphere but don't want any of the typical responsibilities like property maintenance associated with home ownership.
General Information About Panama
Q. What's the capital of Panama, and what are some major cities?A. Panama has two main cities: Panama City, the capital, and Colon, on the Caribbean Coast.Panama City is the main economic center and Colon is a city that houses the largest free trade zone in all of the Americas. David is Panama's third most populous city and is located at the center of a rich farming region of Chiriqui which includes the beautiful town of Boquete only 20 minutes away.Q. What about the government and economics of Panama?A. The government of Panama is democratic and is trying to make it easier for foreigners to buy real estate and live in the country.The economy is broken down as follows: 74% service, 16% industry, and 10% agricultural.The country's inflation rate has averaged less than 2% per year over the past 40 years which is extremely rare south of the United States. Panama's economy is one of the best performing economies in Latin America.Q. What is the climate like in Panama?A. In Panama, there are two distinct seasons: The dry season-summer, or verano-(January-May); and the rainy season-winter, or invierno-(May-December).The dry season is considered the tourist season. The rainy season brings regular afternoon showers of short duration. Panama City has an average temperature of 78 degrees F.Q. Where does the word "Panama" come from?A. "Panama" means "abundance of fish" in Indian language, and Panama lives up to this name as a world-class sport fishing destination.Q. What is the best way to travel to Panama?A. Panama has good air connections with destinations throughout the Americas and part of the Caribbean and Western Europe. International flights arrive at and depart from Tocumen International Airport, 15 miles northeast of Panama City.Carriers serving Panama with nonstop or connecting flights include:American Airlines, Continental, Delta, Iberia, Air Madrid, Copa (the national airline of Panama), TACA, LACSA, and Cuban. Another international airport is expected to open in Playa Blanca, Panama in 2008.Panama's gateway cities in the United States are Atlanta, Houston, Los Angeles, Miami, Newark, Raleigh-Durham and Orlando. The busiest flight is Miami-Panama City, which takes just under three hours.Q. What are Panama's most popular attractions and tourist activities?A. The country's most famous attraction is, of course, the Panama Canal, the world's grandest shortcut and one of the great engineering marvels of all time. It is currently undergoing a major expansion which will greatly increase its capacity as well as attract millions of visitors in the coming year. The U.S. relinquished control of the Panama Canal in late 1999.There are several superb tourism activities that can be easily reached from Panama City. There are five golf courses in or near the city and beach areas. Dining is excellent in Panama City, and there are numerous. bars, discos and cafes. In addition, there is birding, diving/snorkeling, ecotouring, fishing, hiking, rafting/kayaking, surfing, and more.The Parque Nacional Coiba is one of Panamas's ecological treasures, and its rich aquatic life has earned comparisons to the Galapogos Islands.Panama boasts the largest number of bird species in Central America. Bird watchers consider Panama as one of the world's best birding sights.Q. What outdoor activities does Panama offer?A. Panama's exciting attractions include world-class deep sea and lake fishing, surfing, wild-water rafting, kayaking and trekking throughout the country.There is also first-class diving and snorkeling in Bocas del Toro, Coiba Island, the Pearl Islands, Isla Grande, the Golfo de Chiriqui and even in the Panama Canal.Q. Is Panama safe?A. Yes. Like many countries, Panama sees poverty and richness, and often the division is obvious. However, Panamanians are very charming and welcome tourists and foreign residents.Q. What precautions should be taken to avoid health risks while in Panama?A. No special precautions are needed for travel in Panama. The only exception would be for travelers planning remote and uninhabited parts of the jungle for several days.Q. What currency is used in Panama?A. The U.S. dollar is the main currency in Panama.Q. Do most places in Panama accept American credit cards?A. Yes. All major credit cards are widely accepted. Traveler's checks are not as convenient as most banks and hotels charge a fee for cashing them.Q. Are there any national parks in Panama?A. South of the city of David, the Golfo de Chiriqui is home to the "Parque Nacional Marino Golfo de Chiriqui," an immense national marine park protecting 25 islands, 19 coral reefs and an abundance of wildlife.Other national parks located at the Peninsula de Azuero are: Montuoso Forest, Reserve, Cerro Hoya National Park, La Tronosa Forest Reserve, Isla Cañas Wildlife Preserve, Isla Iguana Wildlife Refuge and Peñón de la Onda Wildlife Preserve.Q. Is living in Panama like living in a third-world country?A. No, not at all. Panama has a good infrastructure with excellent services such as Internet access, cable TV, good cell phone service and reception, access to American-style products and services, and affordable quality healthcare.In many retirement havens, foreigners must give up many of the technologies and amenities they enjoyed in their home countries. But, in Panama, foreigners will find that the country offers the state-of-the-art benefits and conveniences usually found only first world countries.Q. How does the cost of living in Panama compare with the U.S.?A. Prices are generally less expensive than in the United States, but, as with most countries, things are more expensive in the capital than in outlying areas.Food prices can be comparable or less expensive depending on whether the product is local or imported.Healthcare is substantially less costly than in the U.S.Q. Is hiring a maid feasible?A. Definitely. Most homes are equipped with a maid's quarters. Typical salary for a maid is approximately $200 per month plus food and housing.Q. Does Panama offer good health insurance?A. A number of companies offer a wide range of insurance options. Premiums usually between $40 and $200 per month, depending on coverage.Also, most doctors in Panama are educated in the U.S., and quality standards in Panamanian hospitals often meet the standards of hospitals in the U.S. There is at least one hospital in each of the major cities of Panama.Q. Can foreigners bring their dog or cat to Panama?A. Yes, foreigners can bring pets, and the country has made this a very easy process. A veterinarian located at the airport will inspect the animal and give it any required shots.Pet owners will be charged a fee for the various forms and shots, but the animal will not need to be quarantined. Foreigners should bring all related paperwork for their pet.Q. Does Panama have a reliable banking system?A. Panama has about 90 banks. Of these 90, over 40 bear a general license, which allows them to provide general banking services to local and foreign residents.Panama's banking system is well regulated, and differs from other countries in that banks must have a physical presence (offices, staff, operations, etc.) and comply with all required laws and asset minimums, as well as with banking rules and regulations.Q. Do foreigners need a visa to visit Panama?A. Most foreigners enter Panama with a Tourist Visa or a Tourist Card, which allows them to visit the country for a 90-day period. Currently, almost all foreigners are allowed to enter Panama with a "Tourist Card," which can be obtained from nearly all airlines flying into Panama, while the tourist visas are issued by the Panamanian Consuls.A valid passport is also required to enter the country.Q. How can a foreigner obtain a permanent resident visa?A. Under Panamanian Immigration laws, there are different kinds of visas that authorize an alien to reside in Panama provided they meet the established requirements.Tourist Pensioner Visa (Turista Pensionada): this is designed for people whose pension from a government entity or private corporation is $1000 or more.Private Income Retiree Visa (Rentista Retirado): this visa is designed for people who, despite not receiving a monthly pension, are no longer working and have received a lump sum retirement payment which may be deposited into a five-year certificate of deposit with the National Bank of Panama, yielding a minimum of $1000 a month.Person of Means Visa (Solvencia Económica Propia): this visa is designed for those, not employed or starting a business, but living of their own means. The person must have a one-year certificate of deposit in any bank in Panama with a minimum of $250,000. Upon applying for renewal of the visa, the certificate must also be renewed for one more year.Investor Visa (Inversionista): this visa is designed for those who want to start a business in Panama with a minimum investment of $250,000 and a minimum of three permanent Panamanian employees employed.Q. Is the visa application process difficult and expensive?A. The visa process for the pensionado program is very simple. It's a one-time application. There are no renewals and no additional fees.Other visa programs require foreigners to file a renewal each year. This involves time, paperwork, and additional fees. The process takes only a couple of weeks and the legal fees are about $2,000.Q. Are there general requirements when applying for a visa?A. Yes. All visas applications must be made through a Panamanian lawyer. All overseas documents to be presented to the authorities in Panama must be notarized and authenticated by the Panamanian consulate or by a notary and the Apostille.The Apostille (Via the Hague Convention of 1961) is a quicker way of authenticating documents and is normally obtained through the Secretary of State in the foreigner's home state (in the United States) or through the Foreign Office (in Great Britain). Canadians should check with the Panamanian Embassy or consulate nearest them.All documents must be fresh, (within two months of visa application) and passports must have at least one year to run.A note regarding dependants: If a spouse will be covered by your visa, the foreigner will need to bring a marriage certificate. However, original marriage certificates are not acceptable if over two months old, so foreigners may need to obtain new ones.If children under 18 are to be covered by the visa, they'll need to bring fresh birth certificates (not originals).Q. Do foreigners who own property in Panama have to pay income taxes in Panama?A. The Panamanian Fiscal Code defines a taxpayer as any person or entity (corporation or partnership), national or foreign, receiving taxable income.According to the code, only income that is produced from any source within the territory of the Republic of Panama is subject to income tax, regardless of the place where it is received. This means income from sources outside Panama is not subject to taxes in Panama.

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