IL Postcard

Top 5 Panama Business Opportunities

Date: 06/10/2008

June 11, 2008
Panama City, Panama

Dear Panama Enthusiast,

I just returned from Cancun, where International Living's Ultimate Event brought together country experts and potential expats like you from around the globe. I couldn’t pass up the opportunity to talk about all the wonderful things Panama has to offer, and there was an overwhelming interest in Panama, as always…

One of the most popular topics by far—both at the seminar and based on recent feedback from readers—involves work and business opportunities. Along with other speakers, I'll go into more detail about that during the July 31–Aug. 2 Live & Invest in Panama Seminar.

To get the ball rolling, let me sum up my top five picks—opportunities that are virtually a sure thing, because Panama needs them now:

1. Education is big business…and can help you "give back," too. Panama has excellent private schools, trade schools, and universities, but many are full with waiting lists booked years in advance. This translates to a need for more schools offering a greater variety of courses. A project in Panama City called the City of Knowledge (Ciudad de Saber, or CDS) offers the ultimate combination of incentives and academic setting for nearly any educational endeavor.

The CDS is an idea incubator—a place for innovations in business and academia to develop and grow. Its academic component facilitates associations between educational, research, and technological institutions to promote human development in Panama. Participants are privy to some of Panama's best financial incentives (and with all the major tax and financial incentives this country offers, that is saying something).

2. Serve your fellow expats: As you may well know, there's a growing expat community here. Many, if not all, have been wooed by the infrastructure…and although it is excellent, there are still niches to be filled. I've heard many a grumble about the lack of a good expat center--a place where people with similar interests can come together for anything from AA meetings to book exchanges.

There are many options for such an organization. You could look into getting investors and running it as a non-profit—with certain staff members getting a salary—or set up the business as a Panama corporation. Forming a corporation is quick and easy, and will cost you about $2,000, more or less.

3. Put a roof over someone's head. As I've mentioned in Panama Insider, this country needs more hotels. Though there are many new hotels and more in the works, the demand is still much higher than the supply. Ronan McMahon, head of Pathfinder Real Estate International, estimates supply will be at least five years catching up with demand.

Weekend hotel occupancy rates grew some 20% in the first half of 2007 over the same period last year and are now near 100% in Panama City. In addition, international airport arrivals have been steadily increasing. In January 2008 they went up to about 89,700—that's about 25% more than in same period in 2007. Nice, clean options for travelers on a budget are needed, as are more short-tem rentals or condo-hotels. Says McMahon, the short-term rental market in Panama is among the strongest and most reliable in the world in terms of rental returns…talk about attractive.

4. A place to rest: With so many flocking here to take advantage of the world's best retiree program, you may be surprised to learn that assisted living facilities for the infirm or elderly are few. Facilities that cater to English speakers, meanwhile, are virtually non-existent. In Mexico, facilities for expats are popping up all over the place, and there is no shortage of expats wanting to take advantage of the high-quality, low-cost care these provide. Follow the Mexico example in Panama and you're sure to have more customers than you can imagine.

5. The "special economic area" is a blank slate: In this month's issue of Panama Insider, we'll tell you about an area in Panama that's about to take off in a very big way. It's referred to as the "area económica especial" (special economic area)…but don’t let the name throw you, as this area is large enough to encompass both commercial and residential developments. A host of special financial incentives have already begun to attract big business here, and development of the residential sector is soon to begin in earnest.

Here's where it gets interesting: there are already a lot of people living and working in this area. But aside from one gas station with its miniscule shop, there are virtually no services here for the residents and workers…no restaurants, bakeries, dry cleaners…you get the picture. Start any business that's aimed at serving the needs of these people and you are on a one-way road to success. We tell all about this area and the special incentives that make it "oh-so-attractive" in this month's issue of Panama Insider, now online.

Thanks for reading Panas,

Jessica Ramesch
Editor, Panama Insider

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