Tourism in the Republic of Panama kept its growth during the past 5 years. The number of tourists arriving between January and September 2008 was 1,110,000, 13.1% or 128,452 visitors. This was a significant increase to the 982,640 travelers who had arrived in the same period of 2007, a year that beat all records regarding the entry of tourists into the country.
The arrival of tourists from Europe to Panama grew by 23.1% during the first nine months of 2008. According to the Tourism Authority of Panama (ATP), between January and September, 71,154 tourists from the Old Continent entered the country that is 13,373 more than figures for same period last year.
Most of Europeans who have visited Panama were Spaniards (14,820), followed by Italians (13,216), French (10,174) and British (8,833). From Germany, the most populous country in the European Union, 6997 tourists arrived.
Europe has become one of the key markets to promote Panama as a tourist destination.
In 2007 1.445.5 million entered into the Panamanian economy as a result of tourism. This accounted for 9.5% of gross domestic product in the country, surpassing other productive sectors.
Panama´s Law No. 8 is still the most modern and comprehensive law for the promotion of tourism investment in Latin America and the Caribbean. In so-called Special Tourism Zones, Law 8 offers incentives such as 100% exemption from income tax, real estate tax, import duties for construction materials and equipment, and other taxes.
Tax Incentives for Projects in Special Tourism Zones
100% Income tax exemption for a period of 15 years
100% Property taxes exemption including land
100% Exemption from Import taxes including the Sales tax (5%) for 20 years
100% Income Tax Exemption originated by the interests charged by creditors
in the tourism activity investment for 20 years
100% Exemption from liens due to the use of docks or airports built by the company
Law 58 incorporates new regulations and incentives outside the Special Tourism Zones. However, in the metropolitan area the minimum investment has increased to US$3 million and US$50,000 for the rest of the country. The world's largest lodging franchises continue to invest in the sector, including Marriott, Trump Hotels & Resorts, Nikki Beach, Holiday Inn, Sheraton, Inter-Continental, Melia, Best Western, Courtyard, Crowne Plaza, Radisson and Decameron. Other projects focused in ecological and historical tours are also being developed despite a rapid increase in tourism investments. This sector represents great potential for investors.
In 2008, the Panamanian Institute of Tourism (IPAT), approved development of 12 new tourism projects by means of Law No. 8, which promotes tourism in the country through import, property and capital tax exemptions, among others . These 12 projects represent a total investment of 92.5 billion dollars, according to a report published by the Tourism Authority of Panama (ATP).
Investment in the first seven months of the year exceeded the amount of 62.2 million which was recorded throughout 2007.
Since 1995, when fiscal incentives began to be granted, a total of 163 tourism projects have been registered on the National Register of Tourism, representing an investment of 1.624 million 938 thousand and 766 U.S. dollars.
Hotels
Tourism in Panama City has a very interesting offer. Hotel occupancy in Panama City in September 2008 grew by 66.4%. Occupancy rate in first class hotels was 78.58%.
In 2010, Panama hopes to double its lodging availability, enough to receive 1,500,000 guests. In addition to options in the banking area, new hotels are under construction at Punta Pacifica, Costa del Este, Bella Vista, Avenida Balboa, by both North American and European consortiums. Also the option of condo hotels, it’s been offered, featuring lodging areas and apartments or penthouses for investment.
The overall average occupancy rate of lodging was a 53.6% during 2006, with 64.8% for first-class hotels and 35.1% for second class installations, according to a statistical report from the ATP.
Lodging projects, such as resorts and spas have also been developed in Colon, Azuero, Chiriqui, Bocas del Toro and Las Perlas Islands, mainly attracting tourists from the United States, Canada and Europe. Negotiations which include international airlines are being conducted to initiate charter flights service.
Workforce in the hospitality industry includes approximately 39,928 employees, according to an analysis by the government.
Tourism
Potential
The country has 1,398 tourism attractions currently registered, from which 1,005 representing 71.9% are natural sites and 393 representing 28.1% are cultural and historic expressions.
Also, Panama presents many attractions for the investors of other countries:
A dollarized economy
Political stability
Legal security
Tax incentives
Airport hub
A United States lifestyle
Absence of hurricanes, tsunamis, etc.
A bilingual population (in its majority)
International attractions like the Panama Canal, with more than ninety years, exotic flora and fauna.
Prestigious law, auditing and consulting firms.
More than 100 multinational companies
In the following years the ATP will invest 39.5 million in the tourism campaign. One section of this budget will be destined to the registration system and tourism quality by means of the "Compite Panamá" program (US$133,000); tourism signs in national roads (US$145,000); programs for rural bed & breakfast (US$150,000); installations of tourist information kiosks (US$275,000), construction of the craft center of Panama Viejo (US$650,000); construction of the tourist center of San Carlos (US$493,500).
For investment opportunities in the tourism sector, these are some highlight in various areas:
The lands of the old airport of Río Hato for the construction of projects, for its attraction and development opportunity in the area of the Pacific.
Isla Colon in the province of Bocas del Toro.
The residential tourism in the province of Chiriqui, especially Boquete, Cerro Punta, Volcan and the beaches of Alanje.
There are being developed 10 mega projects of residential tourism in other areas of the interior of the country. Including gated communities, hotels, golf courses, marinas and new commercial center.
Sustainable tourism and nature conservation projects such as wildlife and flora watching sites are being developed in reverted areas of the former Canal Zone. These projects are supported by the ATP and have access to international entities counseling and funding.
Sustainable Tourism Master Plan 2008-2020
The Tourism Authority of Panama (ATP) in its Master Plan for Tourism Investment for plans the execution of 21 programs and 72 subprograms.
These programs require a total investment of 741.1 million dollars and will be divided into three strategic groups: marketing, development and construction, and transverse management.
The plan identifies 8 regions with 26 destinations spread throughout all provinces. There are projects in Bocas del Toro, Chiriqui Grande, Volcan Baru, Boquete, Gulf of Chiriqui, Caribbean Coast, Gulf of Montijo, Coiba, Ocu, Las Tablas, Pedasi, Las Perlas, Portobelo, Tuira and Sambú.
The Master Plan also highlights the Infrastructure and Shipping Program, which will have a higher budget item: 204.6 million by promoting the construction of a pier for large cruise vessels in Panama City, to consolidate global cruise shipping activities.
In the air transportation sector, the Master Plan will promote the creation of an international airport that specializes in tourist activity, whose main activity is the operation of charter flights allowing distribution of tourists around the area.
Investments
Since 1995, when fiscal incentives began to be granted, a total of 163 tourism projects have been registered on the National Register of Tourism, representing an investment of 1.624 million 938 thousand and 766 U.S. dollars, the Office of the Old Quarter has invested 3.5 million dollars in a series of projects being undertaken in the area declared as historical heritage. A concession to manage about 200 parking spaces has been granted to address the increasing demand from visitors and as a result of new businesses openings in the area.
In 2008, the Panamanian Institute of Tourism (IPAT), approved development of 12 new tourism projects by means of Law No. 8, which promotes tourism in the country through import, property and capital tax exemptions, among others. These 12 projects represent a total investment of 92.5 billion dollars, according to a report published by the Tourism Authority of Panama (ATP). Investment in the first seven months of the year exceeded the amount of 62.2 million recorded throughout 2007.
The Panamanian, in the same year, started 460 road infrastructure projects. Highlights of this initiative are of the Coastal Strip (Cinta Costera), along with the extension of the South Corridor (Corredor Sur) that will run up to the Bridge of the Americas, or Transmilenium, public transport project, representing an overall investment of over 170 million dollars.
Among infrastructure projects that will have an impact on tourism, business and investments in Panama, is the construction of the Madden-Colon Highway at a cost of $ 215 million. This will complete the Panama-Colon route, which will allow an expedite passing from the Pacific to the Atlantic Coast.
In the province of Chiriquí the project known as the South Route is been executed at a cost of $3 million 125 hundred thousand dollars.
Casinos
Bets on casinos, gambling halls, racetracks and lottery in Panama, moved approximately 1.176 million 842 thousand 960 U.S. dollars, an increase of 19% compared to 2007.
Gross of gambling entertainment is concentrated in casinos with 568.2 million dollars in type a slot machines and 202.9 million dollars in others.
Panama has become a destination for gambling Latin American tourists not having a chance to travel to Las Vegas in the U.S.
Cruise Ships
One of the tourism sectors that have experienced a recent growth is cruise ship activity. Panama has developed the proper infrastructure to accommodate this industry, including two ports in the Atlantic side of the Canal, Colon 2000 and one in the Pacific entrance, Amador Cruise Ship Port.
Two (2) brand new cruise passenger terminals have been built on the Atlantic and Pacific entrances of the Panama Canal representing in investment of US$100MM and opening more opportunities for cruises and mega-yachts docking in Panama for services and pleasure.
Annually some 300 thousand persons arrive in cruise ships to Panamanian ports. During high season there is a growth between 2 and 3%. It is estimated that in the next cruise season, there will arrive at least 287 thousand 650 tourists in 192 cruise ships, leaving at least 40 million dollars to the Panamanian economy.
Shopping for tourists is just getting better with the mega shopping malls been constructed at a cost of U.S. $ 100MM each one, Albrook Mall, Multicentro Mall and Multiplaza Pacific Mall are the most important while there are also other popular shopping malls like Los Pueblos, Los Andes and El Dorado.
Luxurious stores at Multiplaza Pacific Mall, represent famous franchises such as Louis Vuitton, Bulgari, Cartier, Chanel, Ermenegildo Zegna, Giorgio Armani, Ralph Lauren, Carolina Herrera, Adolfo Dominguez and Loewe. In addition to exclusive restaurants specialized in European and South American cuisine, lounges and numerous bars. On the other hand, Albrook Mall is the largest roofed installation with air conditioning, and continues to expand to offer more shops, restaurants, entertainment and facilities for tourists and visitors. This is a convenient tourist offer for travelers looking for comfort, entertainment, night life and business.
Additionally, Panama entered an agreement with Florida Caribbean Cruise Association (FCCA) to promote our country as one of the best destinations in the region and as a Cruise Ship hub. Between December and April of each year, starting in 2008, every Sunday cruises from the Royal Caribbean International cruise line will sail from port Colon 2000. Travelers will visit Cartagena and Santa Marta in Colombia, and the islands of Aruba, Curacao and Bonaire, in a journey that lasts a week. This activity will also help to promote 50 weekly flights bringing tourists from different nationalities.
All these efforts have resulted in the recognition of Panama by Porthole Cruise Magazine as “Best Adventure Destination”. Además de tener un lugar asegurado en diferentes ferias internacionales, como las de España y Canadá.
If you want to set up a tourism project, in the BusinessPanama Group, we have licensed real estate agents, excellent lawyers, insurance specialists, financing brokers, investment advisors and other professionals to assist you on all your business needs.
We can help you with:
Buying properties in Panama City, Beaches, Islands or Mountains
Forming a company to own your property
Legal services for all aspects of land acquisition and project development
Title insurance
All insurance required
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Others
If you are a developer or promoter, the BusinessPanama team of realtors, lawyers and experts will provide you a variety of services from the purchase of the property to all phases of development including structuring, subdivision, financing, contractual, design, environmental, construction, permitting, pre-sale and sale. We will be glad to provide you access to our “List of Recommended Professionals” formed by first class architects, environmental consultants, builders and others.
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