Panama City, Panama

At the heart of Central America, which ties together North and South America and the Pacific and Atlantic Oceans is a small, quirky country being hailed as the next “Singapore of Central America” – Panama.

Panama is the fastest growing economy in 2013 for Latin America

This that has many experts comparing it to Singapore, another rag-to-riches success story.

But Panama isn’t booming just because of lucky geography, it’s booming because of smart free-market, investment-friendly policies which have sharpened its advantages:

• Panama’s currency is the U.S. dollar. This makes investing in the country easy.
• Banking and communication services are world class.
• Panama launched a five-year, $13.6 billion investment plan, focusing on schools, hospitals, sewerage, roads, and metro transit system.
• Panama’s import tariffs are among the lowest in Latin America. Also, the country has received foreign direct investment worth nearly 9% of GDP.
• Panama is a well-regarded tax haven and its banks offer a high degree of privacy.
• There is no tax on interest earned from bank accounts for locals or foreigners. There are no corporate or personal taxes on offshore activity. Residents pay no local taxes on their foreign-earned income.
• The result: an economy that’s grown at an 8% or more clip over the past five years.
  

  Bocas del Toro, Panama

  Booming Expat Paradise

  Panama earned the number 2 spot on Forbes’ The 10 Best Countries to Retire to in 2013 who say:

  “Panama is just plain easy, Panama City is a vibrant, cosmopolitan city with great restaurants, and excellent hospitals. It’s a banking and commercial hub so you find a real international community there. Panama is committed to attracting foreign retirees and offers the world’s best incentive program to do so, making it convenient and easy to get residence there.”

  Things will cost you significantly less in Panama than what you’d expect back home. “A budget of $1,700 to $2,500 a month, housing included, would see you eating out, perhaps with a housekeeper a couple days a week, movies a few times a month, and so on.”

  Panama Canal and Ports

  A construction boom is also changing the landscape of Panama City. Office towers go up as fast as men can build them, including the Trump Ocean Club and Latin America’s first Waldorf Astoria hotel. But let’s not forget the work being done to double the capacity of the Panama Canal.

  The Canal’s annual revenues have grown to over $2 billion (7.5% of GDP). Traffic and revenue were up about 25% in 2011. This produced a ripple of growth in many related businesses, such as insurance, ship maintenance and repair, trade finance, and banking. The canal and Panama’s business-friendly regulations have expanded big insurance, finance, and legal offshore industries.

  Last year, the free-trade zone in Colón – on the Atlantic end of the canal – and Balboa, Panama’s Pacific-side trade gateway, became Latin America’s two busiest ports. These two ports are set to explode soon after the canal’s $5.25 billion expansion project is completed in 2014. This is one reason Colón’s become the regional base of firms like Procter & Gamble (NYSE: PG)… Two-thirds of the traffic through the canal is coming from or going to America.

  Get ready for more growth. Panama is booming.