Why have more than 60 corporations—including Dell, Hewlett Packard, General Electric, Proctor & Gamble, Caterpillar and the United Nations—all recently decided to make Panama their regional headquarters? The answer is simple: Today Panama is the best place in Latin America to live and do business.
Panama has been ranked by the IMF, World Economic Forum and the Latin Business Chronicle as one of the most competitive and globalized economies in Latin America based on factors such as direct foreign investment, import and exportation figures, GDP growth, low inflation, security.
Panama is also politically stable, safe, has the US dollar as its currency and a nearly first-world communications and transportation infrastructure. (Broad band and internet services are better than most places in the States.) In the last year Panama has overtaken Uruguay as the most technologically advanced country in Latin America, and overtaken Chile as Latin America's leading recipient of foreign direct investment as a percent of its GDP. The combination of all these factors led to an upgrade of Panama's Sovereign debt rating to Investment grade.
During his first year in Office President Martinelli led a major tax reform effort that simplified structures and cut corporate rates and began implementing a 5-year 13.6 billion infrastructure investment plan that will significantly modernize and diversify Panama's strong logistic capabilities. These include a Panama City rapid transit metro, the new Metro Bus system, a new convention center and a government city.
Panama is also the most foreigner-friendly country in the region, due to its long history as a world crossroads, Panamanians actually enjoy foreigners. In a time when so many Latin Americans have a hard time getting visas to enter the United States, Panama is becoming the new Miami for Latin American-based business. Another reason for Panama's popularity is Law 41, modeled on a Singapore's law that gives tax breaks, hiring privileges and other incentives for companies who want to establish a headquarters in Panama.
Panama City has one of the most modern infrastructures in the Americas and also one of the highest levels of security for both tourists and businessmen in the region. Panama's solid economy is based on multibillion dollar Panama Canal revenues including a 5 billion dollar widening now underway, a banking sector with 100 banks, the largest Free Zone in the Americas, a multimodal transport service sector including 3 major ports and a burgeoning tourism industry. Several other multi-billion dollar projects are in the works. Panama also has the best logistical connections by air and sea of any country in the region. COPA Air alone has direct flights to 56 cities in the region.
Panama's economic growth shows no sign of slowing down. This year the Panama Canal is expected to set a new record for transits through the canal, 322.1 million tons PC/UMS—a 7% increased from 2010, and the expansion of the Canal is set to double its current capacity. The result of all these developments means that Panama has enjoyed a yearly growth in GNP of 9%, one of highest in Latin America.
Panama Pacifico, a whole new beautiful 10 billion dollar city in a lush special economic zone just outside Panama City is well underway. With sectors for corporate headquarters, light industry and community and homes, Panama Pacifico is also a Special Economic Area offering legal, customs, immigrations and labor benefits, and extensive tax incentives. An on-site government agency expedites permitting and assists businesses moving to Panama Pacifico. What more could you ask for?
For executives and their families, the sophisticated Panama City offers a high quality of life. To start, it is one of Latin America's safest cities. For family life, there's a wide selection of fine neighborhoods for residence, modern shopping malls, fine dining, three accredited international schools, the best health care in Central America and plenty to do. For recreation and vacation, Panama's many beach and mountain destinations are ideal for family vacations and excursions. Did we mention that according to a recent report by the Economist's Intelligence Unit on the Cost of Living in 2012, Panama City is one of the ten least expensive cities in the world? Panama seems to have it all, and that's why its being called the Business Hub of the Americas.