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Buying Real Estate in Panama for Investment
April 13th, 2010
According to Property Wire “Meanwhile Panama is experiencing a good real estate recovery as foreign buyers including Americans, Venezuelans, Canadians, Colombians and Europeans show increasing interest.
I don’t agree with the word ‘recovery’ but the market is still active, and prices have largely maintained their levels.
The article also states: “Although prices have fallen around 10 to 20%, luxury property has not seen a price decline and there is a renewed building frenzy in anticipation of increased sales.”
I would agree with the 10 to 20% price decline but disagree that luxury property has not declined – this is the property segment that has declined the most!
If you know where to look there are still bargains for Real Estate in Panama - for both individuals and investors. For large investors and/or developers especially, there are some great opportunities – but you won’t find most of them advertised, so contact us for more information.
Strike in Panama's Colon Free Zone
September 1st, 2009
The Colon Free Zone is embroiled in a dispute with the Panama government over paying taxes. It has come to where the bulk of the operators in the zone are going on strike Wednesday, September 2. This will put roughly 30,000 employees out of work for the day.
The issue has to do with tax advantages of operating in the duty free zone. The presence of these tax advantages has helped the zone grow and prosper. However, its presence on the Panama Canal is the major factor here. Now the new administration is adopting and enforcing a policy of each part of society paying its way. That appears to apply to those who have been paying less than the going rate for their taxes.
The issue is not, according to the government, legal exemptions but the fact that some of the operators have not been paying the reduced amounts that they owe and have not been providing the necessary paperwork to the government.
The issue in Panama comes back to corruption and who is paying their fair share. The ongoing rap against Panama is, in fact, corruption. Investment in Panama thrives on a fair system. Hopefully, as the issue of who pays taxes is resolved the issue of government corruption will go away to the benefit of investment in Panama.
Hope for Inflation and the Cost of Electricity in Panama
August 27th, 2009
One of the contributors to inflation in Panama has been the high cost of electricity. It turns out that part of the higher than desired cost of electricity in Panama is that the power companies are buying power at spot prices. According to press reports distributors have roughly 60 percent of demand covered with their contracts with power generators and have been buying the extra at higher prices.
The Martinelli administration is taking the issue of high electric costs seriously. Government officials have sat down with Panama’s power distribution companies and worked through the situation. The distribution companies are being pressured into buying more power at better rates up front. Press reports state that fines may go up for non compliance also. Also the government is considering having distributors buy all of their power through the state’s transmission company, ETESA. This would get rid of the current situation whereby the distribution companies run short on power, buy at spot prices, and pass the excess on to the consumer.
Time for Panama Investment as Economy Is Ready to Grow Again
August 26th, 2009
Recent Panama government figures show that the Monthly Economic Activity Index is up 0.31 percent June to June. This economic indicator predicts a return to a higher economic growth rate in Panama in the later half of 2009. If you live in or travel to Panama you will see that there are still a lot of housing projects and high rises being built despite the recession elsewhere. In fact, the construction sector has grown 11 percent over the last year.
There are still great deals in high end Panama real estate but as economies sort themselves out throughout the world as well as in Panama those “deals” will be bought up in the comming months. For those interested in Panama real estate investment this is an ideal time to take advantage of historically lows property values in Panama before the boom resumes.
We have talked before about mega projects in Panama providing jobs and cash for the economy. We have talked before about the economic opportunities inherent in a modern metro system in Panama. Now is the time to be looking at where to buy real estate in Panama and how to develop it. Now is the time to find that condo on the Bay of Panama for cheap so that you can enjoy your walks along the Cinta Costera as it gets extended to Casco Viejo. Or maybe that’s a walk and a tram ride back.
Panama is an exciting place to live and affords a lot of investment opportunity. Now is the time.
Investment Opportunities in Panama's Metro
August 22nd, 2009
According to press reports the new commission that is overseeing the planning and development for a comprehensive metro system in Panama City is being deluged with inquiries and proprosals. This project will eventually change the nature of mass transit in Panama City and change the face of Panama City. This sort of multi decade project offers investment opportunities in Panama for the asture investor.
A metro system will need equipment, infrastructure, manpower, training, training facilities, and more. A metro system will need Panama City real estate. Some of the real estate will be right of way for above ground lines and some of the real estate needed in Panama City will be surface access to underground train stations.
A Panama metro system will act as a business and rental magnet at its hub locations. A Panama metro system will increase the value of adjacent suburban Panama City real estate as a functioning rail link will effectively make distant locations like the airport at Tocumen closer to the center city, banking district, and shopping malls.
Panama commercial real estate will benefit and Panama residential real estate will appreciate also depending upon placement of and rate of development of Panama’s new metro system.
If you are interested in targeted real estate developments in Panama City talk to ABPanama and get in on the ground floor of the metro related real estate opportunities in Panama City.
Tocumen International Airport Upgrade
August 21st, 2009
Tocumen International Airport, Panama’s hub airport for the Americas has has seen nearly a five percent growth in air traffic in the first half of 2009 despite the global recession and flu scare.
Now Tocumen is upgrading its air traffic safety with a Boeing, Required Navigation Performance (RNP), system. Boeing’s wholly owned subsidiary, Jeppesen, has just completed a critical design review for the RNP system which will “support flights into the Panamanian airports for any airline, with Panama’s Copa Airlines taking the lead in testing the RNP procedures” according to a Boeing press release. RNP is a comprehensive flight navigation system to be used by all airline and meant to promote exceptional air traffic safety.
With the press full of talk about Panama surpassing Miami as the Latin American center for commerce, banking, and air transfers this is tangible proof of Panama’s progress toward a goal of leadership in Latin America. As Panama has dodged the worst effects of the recession Panama has become, again, the target for foreign investment in business and real estate.
Panama Biodiesel Investment
August 17th, 2009
Panama intends to invest up to $16 million in the next five years in production of bio fuels. According the the Ministry of Agriculture there are three parts to this plan. First of all is the donation of bio diesel plant to the Panama government in the last months. Second, is the intent to build a new $6 million bio diesel plant in the coming years, and third is the expected investment of $10 million in an ethanol production facility. Panama investment in non petroleum sources of fuel will hopefully help protect Panama from the next surge in oil prices.
Last year when oil went over $150 a barrel inflation became a major issue in Panama eventually leading to the loss of political power by the ruling party and the installation of the Martinelli government. Panama is working to reduce its dependence on imported oil in a number of ways. Because of its heavy rainfall and mountainous interior Panama has a number of hydroelectric plants capable of producing virtually all of its electric needs during the height of the rainy season.
There are a number of wind farms in the works. A popular Panama wind farm project is on the coast of Colon Province and has already demonstrated a reduction in local electric bills.
According to the ministry the donated bio diesel plant will be able to produce 10,000 liters (or 2,500 gallons) of biodiesel fuel a day. Additional infrastructure needed for the plant will run about $600,000 to get production on line.
Free Trade and Canadian Visas for Panamanians
August 12th, 2009
Prime Minister Steven Harper visited Panama to finalize preparations for a free trade agreement between the two countries. Meanwhile the issue of how Panamanians get visits to enter Canada remains a sticking point.
If business is to develop further between the two nations then it has to be easier for Panamanians to enter Canada. Currently Canada’s only visa office in Central America is in Guatemala! According to those who try to get a visit to enter Canada a Panamanian can be refused and never know the reason why. The same person is allowed to apply again but without knowing why they were refused the first time that seems pointless.
As Panama hopes to see coffee, sugar, sea foods, ceramics, melons, and more to Canada it presupposes that Canada will let business people from here enter their nation to do business. It would seem that having Panama businessmen visit Guatemala City first to deal with their visas would stifle investment and trade between Canada and Panama just as a free trade agreement is in sight.
Panama hopes to see more investment from Canada but also hopes that trade is bilateral. Let’s hope that before the Canada Panama free trade agreement is ratified that the visa situation is rectified.
Prime Minister of Canada Visits Panama
August 11th, 2009
Steven Harper, Prime Minister of Canada, is visiting Panama to sign a free trade treaty with this Central American country. The trade deal has been in the works for about a year. Both nations are attempting to widen their trade associations beyond their primary trading partner which is the United States.
For Canada this treaty is also symbolic of its desire to widen trade relationships throughout Central and South America. For Panama the treaty is a victory while the free trade pact with the USA languishes, a victim of US politics.
Current Canadian investment in Panama runs just over $100 million (CAD) but can be expected to increase with the strengthening of trade ties.
Current Canada-Panama trade comes to $149 million (CAD) and will likely also increase dramatically further improving Panama’s position as the Latin American country with the highest per capita foreign investment.
Getting a Handle on Corruption in Panama
August 10th, 2009
For every year since 1996 the World Bank has published a list of Worldwide Governance Indicators. Among the indicators of good governance measured, control of corruption is considered not only an indicator of good governance but also a strong indicator of a nation’s potential for economic growth and prosperity. The only category in which Panama does not place forth in Latin America is in the control of corruption.
Improved control of corruption will be a strong predictor of improved success in investment in Panama business and the Panama real estate market. We have been following the news story of a former Panama president allegedly having granted gaming concessions to gambling enterprise and then receiving profits from the enterprise. It would appear as though the new administration is following through on promises to deal with corruption in Panama.
Panama is the land bridge connecting North and South America and where the Panama Canal connects Atlantic and Pacific. Panama has unspoiled natural beauty and a first world infrastructure. Panama has the best roads, airports, ports, and telecommunications in Latin America. Panama is currently enjoying an economic boom fueled by foreign investment.
Panama; Control of corruption
According to the World Bank, “Governance consists of the traditions and institutions by which authority in a country is exercised. This includes the process by which governments are selected, monitored and replaced; the capacity of the government to effectively formulate and implement sound policies; and the respect of citizens and the state for the institutions that govern economic and social interactions among them.”
The following table shows where Panama places in comparison to other Latin American countries ranked by percentile for the control of corruption in the WGI (Worldwide Governance Indicator) survey from 1996 to 2007.
Panama vs. Latin America: Control of Corruption
in World Bank WGI Study 2007
Other Latin America countries besides Panama fall below 50% in ranking for the control of corruption and are not shown. According the WGI website the indicators are based on a wide array or sources. “The aggregate indicators combine the views of a large number of enterprise, citizen and expert survey respondents in industrial and developing countries. The individual data sources underlying the aggregate indicators are drawn from a diverse variety of survey institutes, think tanks, non-governmental organizations, and international organizations.”
Control of Corruption and Panama Success
Panama places seventh in all of Latin America in the control of corruption according to the World Bank’s Worldwide Governance Indicators. This is the only one of seven indicators of good government where Panama does not place forth in Latin America. Governmental corruption has long been the rap against Panama. Forty-nine percent is the middle of all countries evaluated. Forty-nine percent is a long ways from industrialized Europe where Denmark ranks 99% and France 89.4% in control of corruption.
If the news of dealing with irregularities in granting gaming concessions is an indication Panama may be improving its standing in dealing with corruption and helping its status as a target for foreign investment even more.
August 6th, 2009
Meteorologists are predicting another El Niño to start later this year. The affects on Panama typically include drought on the Pacific Coast coupled with torrential rains on the Caribbean. A practical problem beside whether you will need sunscreen or an umbrella is that the Pacific Coast drought is often devastating to Panama’s cattle industry.
Cattle grazing in areas without stock tanks will be prone to stress and may die if natural water courses dry up. Panama dealt with a run on inflation in the last few years that has just leveled off. Now, if the country’s meat supplies are reduced imports will be more important and, likely, more costly.
Property values in areas of Panama heavily affected by the drought may drop providing buying opportunities in the later part of the 12 to 18 months that often El Niño lasts. So far Panama has avoided most of the affects of the global recession except for a slower growth rate. A stress on Panama meat producing capacity not to mention drough in its Arco Seca, the breadbasket of Panama could drive prices up and take away some of the gains that Panama has experienced in reducing poverty with high foreign investment.
Panama Real Estate Development Problem Followup
August 4th, 2009
Recently we wrote about the new Panama administration demolishing buildings on an island in the Bay of Panama adjacent to the Amador Causeway. Our admonition was to be careful to follow all rules and regulations governing real estate development in Panama.
Now there is a bill before the Panama assembly that proposes stricter measures to be taken against developers who build on land where building is unauthorized or who fill in off shore without a permit. The proposed law would force the developer to restore the area in question to its previous state if found in violation.
Losing a project is one thing but having to remove fill from an offshore area and dredge down to the sea floor plus restoring the sea floor to its normal condition could bankrupt a developer. If this law passes it may be considered draconian by developers.
ABPanama reminds developers that it is better to play by the rules than have to pay the consequences. When developing real estate in Panama it is wise to have a bilingual, competent, trustyworthy advisor such as ABPanama at your side.
Democracy and Prosperity in Panama
August 3rd, 2009
The world mourned the death of Cory Aquino today as citizens of Manila filled the streets and shouted, “Cory, Cory,” as her coffin passed on a bier of flowers. It has been just over twenty years since the dictator was ousted in a popular revolt and democracy return to the Philipines. This twenty year milestone reminds us of the twenty years of democracy and prosperity fueled by foreign investment and a real estate boom that Panama has enjoyed since the ouster of Manuel Noriega’s military dictatorship.
In the intervening years Panama has not only maintained a boisterous democracy but it has partially eradicated poverty. The ECLAC (United Nations Commission on Latin America and the Caribbean) Social Panorama study demonstrates how investment in Panama has added jobs and helped reduce poverty. The connection of economic success and a democratic government is not coincidental. Democracy and favorable laws attract investment and investment fuels growth with reduces poverty.
Panama maintains the highest per capita rate of foreign investment in Latin America due to its business friendly environment and growing economy. The Panama real estate construction boom has only just leveled off due to the recession but continues due to Panama’s economic strength and the expecation of continued prosperity and investment here at the junction of North and South America.
As real estate prices are now historically low in relation to forward looking values farsighted investors are looking at large parcels of land for a variety of purposes. There are still exceptional bargains in high end Panama real estate that will likely last until the end of the year. The newly elected government is looking to initiate a number of mega projects such as a metro system for Panama City that will further improve the lives of the people of Panama and provide more jobs in this stable democracy.
Hotels Investing in the Future in Panama
July 28th, 2009
While the world works its way out of a global recession hotels are refurbishing, adding on, and otherwise investing in the future in Panama.
Normally a third of more of hotel reservations in Panama come from North Americans. With the recession there has been a slight decrease in traffic from this segment of Panama’s hotel industry. Nevertheless, while much of the world is struggling with the recession major hotels in Panama are using the pause in growth to rennovate, refurbish, add on, and otherwise propare for the expected surge in occupancy that will accompany the resolution of the global recession.
Panama City’s Hotel el Panama has added an elegant black and beige marble lobbly fit for a king as part of its recently completed rennovation. The Marriott and Sheridan are adding rooms and space for more services.
Both local and international hotel chains have decided that investment in Panama is investment in the future. Panama’s economy is growing despite the recession elsewhere. Panama will likely resume its yearly ten percent economic growth after the recession clears and the megaprojects envisioned by the Martinelli administration will not only provide jobs and economic stimulus but further modernize this 500 year old city.
Panama property investment, Panama business investment, and investment in Panama’s labor force has does well for a decade or more. We expect to see a surge in activity in all sectors this next year. Apparently so do Panama hotels.
Reduction in Panama Cost of Living
July 21st, 2009
Panama is taking another step to control food costs and thus help control inflation. There will be ten percent reduction in import taxes imposed on some imported processed meats such as ham and Vienna sausage. Although the cost of the government’s hypothetical weekly food basket, the “canasta basica,” has leveled off Panama is taking preemptive steps to reduce the cost of living in Panama. Panama’s real estate boom has been partially based upon the low cost of living in Panama. Part of the affect of a lower cost of living might be a stimulus to other parts of the economy such as housing construction.
Although this example only applies to imported ham and sausage it is an example of the steps that Panama is taking to reduce the cost of food and the cost of living in this country. Over the last two decades since the ouster of dictator Manuel Noriega foreign investment in Panama has driven job growth but not necessarily higher wages. The low wage scale in Panama, in fact, attracts business.
Because more people are working at more jobs in Panama the level of poverty has gone down dramatically. However, inflation started to eat away at financial gains of Panama workers last year and was, in part, why President Martinelli’s Democratic Change Party won the election so handily. The government seems to be carrying out its promises made during the election campaign to work to better the lives of the average Panamanians.
A side benefit will be to reduce the cost of living for expatriates too. Thus Panama will retain its reputation as an inexpensive tropical paradise with easy residency requirements that is friendly to investment. This will, in turn, continue to provide jobs and drive Panama’s continually growing economy.
COPA Panama Orders More Boeing 737 800's
July 17th, 2009
COPA, Panama’s flag carrier has ordered 13 new Boeing 737-800 jets and placed an option for another 8. While the rest of the world is struggling with financial hard times Panama is planning for and investing in the future. Panama’s economy has slowed down with the global recession but there is still economic growth in this little country at the crossroads of the Americas.
Boeing and COPA have issued a joint statement stating that with conversion of previous options to buy planes and new orders COPA has 27 new Boeing jets on order. COPA flies out of Panama City’s Tocumen International Airport and has nearly fifty connections throughout North and South America as well as Europe.
According the joint statement, “Copa operates from Tocumen International Airport, a time-saving hub on long routes between the United States, South and Central America, and the Caribbean. The airline flies four of the world’s longest 737 routes from there – to Buenos Aires, Santiago, Sao Paulo and Los Angeles – thanks to the 737-800′s exceptional range.”
Panama is a natural for making air connections with its central location on the land bridge connecting the Americas. As Panama expands its air net we can expect to see more business pass through and to Panama, especially as the recession mends itself in the coming year. Investing in Panama has been successful in the past decade or more and investing in Panama will become wiser in years to come.
Panama’s economy is thriving despite a world wide recession. Panama is often referred to as the place to ride out the recession. Investing in Panama with its strong economy is best plan for years to come.
Panama Residency the Wrong Way Just Got Harder
July 14th, 2009
There are a number of reasons for obtaining residency in Panama and all of them require that you proceed legally. However, there has been a little “side business” running a counterfeit document ring from inside of the Tribune Electoral, the Passport Department, the Public Ministry, and the Judicial Investigation Directorate. Apparently these folks have been selling counterfeit passports, identity cards, and drivers licenses.
According to the senior Anti-Organized Crime prosecutor, Jose Ayu Prado, seventeen people have been arrested, some public employees and some foreign nationals. The problem extends beyond Panama in that a Panamanian passport will allow its holder to enter other nations, including the USA and Great Britain.
It is often frustrating to deal with immigration issues in Panama. The system is tedious and often just seems to be a money making machine for Panama. However, to gain residency in Panama whether for retirement in Panama, business in Panama, or to rent or purchase real estate in Panama you need to have the appropriate documents. Anyone who tried to cut corners in getting their residency visa in Panama may have problems as this investigation moves forward.
Investment in Buses in Panama
July 3rd, 2009
There is a new proposal to replace the old US school buses in Panama. This is according to the Blue Bird bus manufacturer in Panama and a group called the Bus Driver and Passenger Movement. The result would be modern, air conditioned buses with automated fare collection that foreign residents will find familiar.
The proposed price for a ride in the city would be 60 cents, up from the typical 25 to 35 cents charged on the Diablos Rojos in Panama City. The group states that advertising would reduce the cost of operations making the 60 cent fare possible.
However, those who want this system are also asking for government guarantees of support should this private bus system run into financial difficulty.
An interesting side note is that Blue Bird says it will cost $200,000 to deliver each bus and that this price is $80,000 more than the cost of importing and renovating a “Diablo Rojo.” It would seem that investment if Diablos Rojos has been very profitable as old US school buses can be obtained for $10,000 to $30,000 and shipping is no where near $100,000.
Anyway, as Panama expands, and improves its infrastructure there are great opportunities for investment in Panama. The new buses are only one example.
Living with a New President in Panama
July 2nd, 2009
For those with residency in Panama yesterday was a holiday as Panama swore in its new president, Ricardo Martinelli. Martinelli is a US educated son of Italian immigrants. Owner of the Super 99 supermarket chain as well as other business ventures, Panama’s new president is variously hyped as a tycoon or magnate instead of a businessman. He is repeatedly referred to as “pro business.” So, for those living in Panama, what will be the differences in a Martinelli administration?
For starters the recession worldwide has slowed down business in Panama. The new administration will need to start out being more frugal which Mr. Martinelli admitted in his inauguration speech yesterday. Also, previous administrations have been “pro business.” What Martinelli seems to want is a level playing field with his flat tax proposeal. That will indeed be pro business if it favors effecient businesses instead of vested interests.
Martinelli believes in projects to create jobs. Martinelli wants to push forward with a metro system for the capital and continue the Panama Canal Expansion. Along with his desire to reduce the size of government Martinelli wants to give raises to public workers.
Martinelli wants to improve the rehabilitation aspects of Panama’s prison system to that they will not be “schools for criminals.” In his campaign speeches he promoted the idea of separating first time offenders from the general prison population.
The new president promises to work closely with Mexico and Colombia in dealing with the drug cartels.
So, how will this play out for those of us living in Panama? At lot of what a new government wants to do depends upon the money to do it.
With the Panama real estate market still in its “pause mode” some of the stimulus for new jobs is waiting for next year. World trade is down but the stats from the Panama Canal reassuring with no more than a 5% drop in traffic by year’s end before things start to pick up. The recent news that there has been an uptick in trade in the Colon Free Zone is encouraging.
What about differences for foreigners with residency in Panama? There is no talk of changing Panama residency laws nor did Martinelli talk about changing banking laws to change offshore banking in Panama.
In all likelihood some of the possible changes will have to do with the attitudes of the people whom Martinelli appoints. If their focus is efficiency and riding Panama of the stigma of government corruption we will likely see a more efficient government.
If Martinelli can find the funding for a metro system it will provide jobs, prosperity, and opportunity in the investment and real estate market in Panama for years to come.
In the meantime Panama residency still means living in a tropical paradise.
Now it appears that a substantial bloc of Democrats are very concerned about workers’ rights in Panama, Colombia, and South Korea. This same bloc of legislators wants a complete and thorough review of all US trade agreements before considering confirming a trade deal with Panama.
Who would have thought that Panama was so important?
The sad part for the USA is that Panama is important and offers unique opportunities to those with it trades and especially to those nations which invest in Panama. We saw this last week that foreign investment is down in Panama from the record numbers of last year but that there is still a substantial foreign investment in Panama.
Panama’s pro business environment, unique geographic position and neutral politics will continue to draw in investment, especially as the expanded Panama Canal operations favor local assembly of final products as well as reshipping of goods throughout Latin America.
While the USA plays politics and lets a potential trade pact whither Panama is doing just fine, thank you, and expecting to see continued domestic growth over the years to come.
Panama Foreign Investment and Panama Subsidies
June 24th, 2009
A stray items passed through the news today. The government is upset that businesses such as food stalls and restaurants are using the small, 25 pound, cylinders of natural gas instead of larger ones.
It turns out the the government subsidizes the smaller ones for home use at $4.37 a tank. Pricing for larger cyclinders varies by size of tank and part of the country.
It is a little hard to blame a small operator in Colon who is trying to make a living selling hot meals on a street corner if he or she uses the cheapest source of gas available. Also it seems that portability might be an issue for a small operator of food stand.
The issue for investment in Panama is two fold. First, the Panama governement has a series of subsidies to protect the poor segment of society again high costs. This starts with lower prices on staples such as rice and milk.
Second, the attempt to keep a level playing field for businesses is part of what makes Panama attractive for investment. It has been foreign investment in Panama that has substantially reduced poverty here in the last twenty years.
Panama has a largely pro business political climate which is unlikely to change in the next years as the recession lifts and business activity resumes it previous pace.
Panama Investment Reduction
June 17th, 2009
According to official figures foreign investment in Panama is down 31 percent at $387 million for the first trimester of 2009 compared to the same period of 2008. ECLAC (The Economic Commission for Latin America and the Caribbean) is predicting that for Central America and the Caribbean that foreign investment will be down 45 percent for 2009.
These figures are about what one would expect considering the global economic crisis on one hand and the attractiveness of Panama for investment on the other. Investment is down but not so much as in neighboring countries.
Panama has a billion dollar fund for economic stimulus of local businesses and projects which will offset some of the decrease in foreign capital. However, look back over the last few years there has been fluctuation in investment in Panama with just under $2.5 billion in 2006, $1.9 billion in 2007 and $2.4 billion in 2008. Panama seems to have done well despite some ups and downs and will do well during 2008.
If the current rate of investment continues that will come to just under $1.2 billion on the year. That is more foreign investment than Panama had for any year prior to 2006!
Colon Free Zone Reports Increase
June 15th, 2009
The Colon Free Zone reports an increase in May exports and imports over 2008 figures, giving a 17 percent increase overall. This one month jump in activity has brought trade figures for the year back close to 2008 numbers for the first five months of the year.
This is welcome news considering the talk of drastically reduced activity and reduced worldwide shipping. We can take this as another sign of the worldwide recession mending itself.
As trade picks up again and general prosperity returns expect to see a surge in business in Panama as well as a more active Panama residential real estate market before year’s end.
Patience is a Virtue, They Say
June 7th, 2009
Patience is a virtue, they say, but how long will Panama have to wait to see if a treaty they agreed to and signed off on will fall victim to politics in the United States.
According to press report the Obama administration is not going to push the trade deal for now because it needs all the Democratic votes it can get to push through a health care bill. As a matter of fact the United States probably needs to get its health insurance issues dealt with sooner than it needs to ratify a trade deal with one small country. The problem for the USA is that not only are Colombia and Korea next on the docket for free trade agreements but none of these countries is going to sit still while the US political players play their cards.
China has a lot of cash as do others. Do not be surprised to see more Asian investment in Panama real estate, business, manufacturing, etc. The expansion of the canal and upgrading of port and container handling facilities is a natural for economic expansion. Panama will benefit and so will its trading partners. Is the US just making another strategic mistake while it focuses on political tactics?
Fewer Cargo Containers
June 4th, 2009
The previous news that shipping transits of the Panama Canal are down three percent from last year has been matched by news that the volume of cargo containers handled in Panama is down just over three percent. It appears that the pain is being spread equally.
However, a little perspective is in order. Panama’s economy is growing despite the world economic crisis. Real estate construction projects in Panama are still going up in expectation of being fully used.
Sometimes the news just repeats itself. We know that the recession is bottoming out and will repair itself over the next moths to year. Investment in Panama business and real estate now will reap returns in ’10 and ’11.