World’s Best Access to Capital

Investment Opportunities Doing Business in Panama Investment Environment Investment Stability Relocate to Panama Economic Information

Panama is at the top of the list of the countries with best access to capital, ranking in Latin American only after Chile and Brazil, according to a report from the Milken Institute published in 2005. The test of this report took into account the economic environment, banking development, capital markets, international recognition and sovereign risk.

Panama had previously been ranked amongst the world’s freest economies. Panama is a member of the World Trade Organization (WTO) and is a beneficiary of the Caribbean Basin Initiative (CBI). Panama had signed several Free Trade Agreements with the United States, Europe, Asia and Latin America countries.

Thought the years Panama has had an open door policy for foreign investment, providing important incentives to business. The list includes:

- An economy based on the U.S. dollar
- Low inflation
- No foreign exchange risk
- Absence of exchange controls
- Equal treatment for foreign and local citizens
- a Flexible Business Law (international acknowledgement)
- No restrictions on companies ownership and foreign capital
- No restrictions on mergers, acquisitions or joint ventures
- Exemption from taxes for investments in tourism, maritime, real estate, mining, Colon Free Zone, exports and other markets
- Bilingual Workforce
- First in the region for low cost of living, low operating cost and competitive work rates.
- High-ranked Panamanian government bonds by international financial organizations

The country has received a positive rating from the Economic Commission for Latin America and the Caribbean (ECLAC), the Organization of American States (OEA) and the Interamerican Development Bank (IDB). It has full coverage of OPIC, MIGA, IDB and other multilateral entities. Also holds the best score-line of investment risk, awarded by prestigious institutions such as Moody's and Standard & Poors.

Panama has been awarded the second position in the ranking of Latin American nations providing better access to capital, surpassed only by Chile, according to the index published by the Milken Institute (www.milkeninstitute.org) of the United States. Moreover, this result was quoted by the financial magazine Latin Business Chronicle. The indicator looked at 98 countries worldwide, of which 18 belong to Latin America. Panama received a score of 4.19 (the maximum is 5.65 and corresponds to Hong Kong), being awarded the 34th position.

The Milken Index "discusses five essential elements that facilitate access to capital in nations:

• Economic Environment
• Development of the banking system
• Development of capital market
• International Environment
• Sovereign risk rating

Costa Rica and Panama are the two countries from Central America that received more foreign investment in 2007, according to a study by the United Nations Organization (UNO) filed on Wednesday in San Jose, Costa Rica, the Central American country received a total of 1.896 millions of dollars, whereas the Isthmus totaled 1.825 million. These figures make them the ninth and tenth place, respectively, in the list of Latin American countries capturing more money.

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