Invest in Panama

A Service-Based Economy 

Panama has a service-based economy that relies heavily on banking, commerce, and tourism.  The well-developed service sector accounts for nearly 80% of GDP.  Services include the Panama Canal, banking, insurance, container ports, flagship registry, medical and health and other business. The handover of the Panama canal has given rise to new construction projects.

The high volume of Panamian trade is due in large part to the Colon Free Trade Zone, the "Trading Showcase" of Central America and the largest free trade zone in the Western Hemisphere.  This gigantic entity at the Atlantic gateway to the Panama Canal is dedicated to the re-export of an enormous variety of merchandise to Latin America and the Caribbean valued at US$6.5 billion in 2005.   In 2006 the zone accounted for 92% of Panama's exports and 65% of imports according to an analysis of figures and estimates of Panama's trade by the ECLAC

The Panamian economy grew 8% in 2006 and the public sector closed 2006 with an 88 million (USD) surplus.  Although Panama has the highest GDP per capita in Central America, and inflation as measured by CPI was only 2% in 2006, about 40% of its population lives in poverty. 

The Panamian Balboa

The Panamian Balboa, (PAB) is named in honor of the spanish explorer/conquerer Vasco de Balboa and is made up of 100 centesimos.  Modern 1,5,10, 25, and 50 centesimo coins are the same weight, dimensions and metalic composition as the U.S. equivalents.  The balboa has been tied to the U.S. dollar at an exchange rate of 1:1 since its introduction and has always circulated alongside dollars.  In practice the country is dollarized.  Panama mints its own coins but uses the USD for paper currency.  (Two other countries in the region to dollarize their economies are Ecuador and El Salvador.)