Moving to Panama

As with so many thriving economies around the world, Panama is an area of Central America which many people tend to overlook and ignore. However, as with the general trend of improving economies in central and southern America there is no doubt that moving to Panama has more to offer than many people would automatically assume and is perhaps worth a look if you are contemplating a move overseas for a new life. While life in Panama can be volatile this is an area of the world which has more to offer than you might think and relocating to Panama might be very interesting in deed!

Panama

To say that Panama has a chequered history is an understatement as the country was for many years a Spanish colony and then the country was effectively part of Columbia. In many ways it is the location of Panama which makes it vital regarding trade routes and travel in and around the region, something which many expats have begun to realise and appreciate. While one of the smaller countries in Central America, Panama has an economy which in many ways is far larger than you might expect. Political and economic uncertainty has, like so many other Central American and Latin American countries, been very prominent in the history of Panama but it would appear that the dark days of the past are behind the country and a bright future lies ahead.

Where is Panama

As we mentioned above, Panama is located in Central America between the Caribbean Sea, Pacific Ocean, Colombia and Costa Rica. It is the Panama Canal which is perhaps the jewel in the crown of Panama allowing trade to pass between the Atlantic Ocean and the Caribbean Sea to the north of the Pacific Ocean. The country is relatively small, around 75,000 km square, and is only ranked as the 118th largest country by landmass in the world. To put this in perspective, Panama is roughly the size of the US state of South Carolina.

The geography of Panama is dominated by various hills and mountain ranges which divide the country and offer a variety of climates. Due to its unique position between North America and South America, Panama is also regarded as having the most diverse wildlife in the Americas taking in species from South America and North America. When you take into account the fact that there are only around 3.3 million people resident in Panama it does appear to punch above its own weight on the worldwide stage.

The weather in Panama

In simple terms Panama has a tropical climate although due to the various mountain ranges the temperature on the east and the west side of Panama can vary markedly. In the lower regions of Panama the temperature in and around the capital city will rarely move out of the range of 24°C to 29°C thereby creating a fairly constant climate. However, it is worth noting that temperatures on the Pacific side of Columbia are markedly lower than those on the Caribbean side and while there is a variation in temperatures the various climatic regions of Columbia tend to be based upon rainfall.

The variation in rainfall can be anywhere between 51.2 inches a year and 118.1 inches a year with much of this falling during the rainy season, traditionally between April and December. Even though Panama is outside of the traditional hurricane belt thunderstorms are commonplace throughout the country. To give you an example of rainfall in the region, Panama City will receive around half of the rainfall seen on the Caribbean side of the country.

Agriculture is a main part of the make-up of Panama although the ongoing reduction in forest cover in the country is causing a major problem. Despite the fact that nearly 40% of Panama is still wooded, this has fallen by nearly 50% since the 1940s and is beginning to impact upon the climate and the wildlife in the region.

Working in Panama

While there are a number of thriving business sectors in and around Panama there is no doubt that the Panama Canal is the backbone of the country and the backbone of the economy. The country has a relatively low unemployment rate of around 5.6% and poverty rates have fallen from nearly 30% in 2006 to around 10% in 2009. Many believe that Panama has the potential to be the fastest-growing economy in Latin America between 2010 and 2014.

Much of the improvement in the Panamanian economy is as a result of the new president taking office in 1994. President Ernesto Perez Balladares immediately introduced a number of major changes to the economic layout of Panama, opening up new markets to foreign investment and implementing controls on the government budget which have never been seen before. GDP growth has been fairly constant since the mid-1990s although again this can tend to fluctuate depending upon worldwide trade patterns and income created by the Panama Canal.

Again, like so many of the emerging economies in Latin America and Central America, the Panamanian economy is heavily biased towards the services sector with banking, commerce, tourism, trading and private industries all very prominent in the region. There is also a very close working relationship with the United States of America which has been heavily involved in the development of the Panama Canal and its ongoing upkeep. However, tourism continues to play an ever more vital role in the Panamanian economy and as the number of overseas visitors to the region continues to rise, as does the amount of investment from foreign parties.

Major cities in Panama

Even though Panama is a relatively small country on the worldwide stage, there are still a number of major cities in the region which are attracting the attention of investors and expats alike. What is there to offer and where should you look to relocate in Panama?

Panama City

It will come as no surprise to learn that Panama City, the capital of Panama, is the largest city in the country with a population of over 800,000 people which rises to around 1.6 million when you take in the various regions around the city. It will also come as no surprise to learn that Panama City is located at the Pacific entrance of the Panama Canal which is the backbone of the country and the backbone of the economy.

As far as employment in Panama City is concerned it is worthwhile knowing that 55% of the country’s GDP is directly related to the capital city. There are more than 80 banks operating in the region, various tourist attractions, a growing hotel sector as well as the obvious attractions of the Panama Canal. This area of Panama is amongst the most highly developed with regards to technology with Internet use widespread and communication systems amongst the best in the world. The ongoing development of the Panama Canal will almost certainly attract more investment and more visitors to the region.

San Miguelito

San Miguelito is the second largest city in Panama with a population of over 320,000 people although it is a relatively small area which covers just over 50 km square. Situated in the same district as Panama City, the capital of Panama, like so many other cities in the country it does play second fiddle to the capital. However, its vicinity in the country is a great benefit in relation to the Panama Canal and the significant inward and overseas investment this continues to bring.

Tourism and the services industry are again prominent in this particular region of Panama and a relatively calm political scene and economic outlook bode well for the future.

Tocumen

Despite the fact that Tocumen is a relatively unknown city in Panama, it is actually the third largest in the country with a population approaching 90,000 people. The very fact that the city is best known for its airport perfectly illustrates how Panama City continues to cast a shadow over each and every other city in Panama. No other area of the country can compete with Panama City which has access to the Panama Canal and the latest technology and communication systems in the world.

However, as the wealth in Panama continues to grow, and indeed many experts expect the economy to grow significantly in the future, we should see some of the less prominent cities grow in stature. Whether there are significant employment opportunities in the short term for those looking to relocate to Panama is open to debate with many of the international partners of Panama, and Panamanian companies, located around the obvious hotspot.

David

The city of David has a population of around 82,000 people although the population including the surrounding region is nearer 125,000. Despite the fact this is the fourth largest city in Panama it is one of the most heavily industrialised and a vital trade link between Costa Rica and Panama. There is a heavy influence from manufacturing, heavy industry, technology and communication with regards to the economy of David as well as a number of tourist hotspots with a very lively nightlife, well developed retail sector and various entertainment facilities. Again, the city of David is fairly small in size although renowned as one of the more industrialised in the country.

The cost of living in Panama

While there have been significant changes in the make-up and the size of the Panamanian economy over the last 20 years or so, the cost of living in the country is still relatively low. Those who move to Panama from countries such as the US and the UK will immediately find that locally produced goods and produce are much cheaper than in their former homelands although it has to be said that many imported goods will be relatively expensive compared to the cost of other goods in the country.

However, on the whole the cost of living in Panama is but a fraction of that seen in the UK and the US and is unlikely to change in the short to medium term. That said, as with any country in the world, if you want to live the high life and expensive life in Panama there are regions in the country which will accommodate this. However, if you have a budget then there is no doubt there are areas of the country which will allow you to live well within your means.

Despite the fact that Panama has developed into one of the largest economies in Central America and Latin America, many people are still surprised by the modern layout and structure of areas such as Panama City. As we mentioned above, Panama is one of the most vital trade routes in the world and this has attracted massive overseas investment in the region, which has seen the development of leading communication systems and leading technology. The Panama of yesteryear is very different to the Panama of today although the cost of living in the country is still relatively low compared to more prominent and more developed countries.

Conclusion

Despite the fact that Panama has been overlooked by many expats over the years this is a region which continues to grow and has a vital part to play on the worldwide trade scene. There is no doubt that the Panama Canal is the backbone of Panama and as such this particular region attracts the lion share of visitors and overseas investment. However, as the Panamanian economy continues to grow there is no doubt that wealth will spread across other regions of the country and we should see more prominent cities developing in the future.

As we mentioned above, the cost of living in Panama does vary and does take in a whole host of different budgets, but on the whole it is relatively low compared to countries such as the UK and the US. Political uncertainty and political unrest now appear to be in the past although crime rates are a concern in some regions of Panama. However, when you take everything into consideration there are many plus points with regards to Panama and more and more expats appear to be waking up to the country’s potential.

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