Panama Fact Summary 2020

Panama summary of political, economical, legal, investment

Panama Fact Sheet - 2020


Transparent elections since 1990

Smooth transition of power every 5 years

Long tradition of openness to foreign investments

Structural adjustments to economy proven positive

Bureaucracy reduced, but still a major factor


US dollar is legal tender

One of the fastest growing in the world with an average GDP growth of 6.80% over the past 8 years

Inflation rate was 0.8% (2018)

Unemployment 6.0% (2018)

Foreign Direct Investment reached over USD 5.5 billion (2018)

Free trade agreements with more than 10 countries, including USA


No exchange or currency restrictions

Panama´s debt is ranked "Investment Grade", only 3 countries in LatAm have this status

Moody's raised score of Panama's sovereign debt rating to Baa2 and improved its outlook for Panama from "stable" to "positive"

An economic landscape of friendliness toward foreign investment with healthy and rigorous trade agreements i.e. The Investment Stability Law, the Free Trade Agreements, and Bilateral Investment Agreements (BITs)


No restriction on 100% foreign owned real estate

BITs with multiple countries securing against expropriation and other risks

One of the most flexible corporation laws in the world

No restrictions on mergers, acquisitions or joint ventures

Enforcement of foreign judgments and arbitral awards

Generous tax incentives for relocating headquarters of multinationals


Depending on the investment sector:

Exemption or discount from income tax

Exemption from import tax on equipment and raw materials

Accelerated loss carry-forward

Accelerated depreciation

No foreign exchange risk

Absence of exchange controls

No restrictions on companies ownership and foreign capital

Other Highlights

Panama is rated the third most competitive country in Latin America, according to the World Economic Forum

Panama has been rated as third best place to retire, according to the International Living´s Annual Global Retirenment Index 2018.

Panama has been awarded in the fifth position of the ranking "Business Perception" of Latin America, according to Global Opportunity Index 2018 published by the Milken Institute.

Caterpillar, Procter & Gamble, 3M, LG, AES, TOTAL, Roche, Hershey and Heineken are some of the 100 most recent multinationals relocating their Latin American headquarters to Panama

All information above is for the current year except for economic data which is usually for the previous year.


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