Panama Fact Sheet - 2021 |
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Political |
Transparent elections since 1990 |
Smooth transition of power every 5 years |
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Long tradition of openness to foreign investments |
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Structural adjustments to economy proven positive |
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Bureaucracy reduced, but still a major factor |
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Economic |
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 except the period of global pandemic. |
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Inflation rate was 1.6% (2021) |
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Unemployment 18.5% (2021) |
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Foreign Direct Investment reached over 622.30 USD Million (2021) |
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Free trade agreements with more than 10 countries, including USA |
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Financial |
No exchange or currency restrictions |
Panama´s debt is ranked "Investment Grade", only 3 countries in LatAm have this status |
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Moody's raised score of Panama's sovereign debt rating to Baa2 and confirmed its outlook for Panama to "stable" |
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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) |
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Legal |
No restriction on 100% foreign owned real estate |
BITs with multiple countries securing against expropriation and other risks |
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One of the most flexible corporation laws in the world |
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No restrictions on mergers, acquisitions or joint ventures |
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Enforcement of foreign judgments and arbitral awards |
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Generous tax incentives for relocating headquarters of multinationals and now multinational manufacturing and assembly. |
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Tax |
Depending on the investment sector, the following are available: |
Exemption or discount from income tax |
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Exemption from import tax on equipment and raw materials |
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Accelerated loss carry-forward |
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Accelerated depreciation |
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No foreign exchange risk |
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Absence of exchange controls |
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No restrictions on companies ownership and foreign capital |
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Other Highlights |
Panama is rated the third most competitive country in Latin America, according to the World Economic Forum |
Panama has been rated as No. 1 place to retire, according to the International Living´s Annual Global Retirenment Index 2022. |
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Panama has been awarded in the fifth position of the ranking "Foreigner Investment" of Latin America, according to Global Opportunity Index 2022 published by the Milken Institute. |
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Caterpillar, Procter & Gamble, 3M, LG, AES, TOTAL, Roche, Air China, 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.
For more information, please contact us.
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