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Panama has what is referred to as a "mixed-western" economy. This means Panama's economy is mainly based on the services industry, namely banking, commerce, and tourism. Come to visit Panama and you will see that the construction industry is busy and has been ever since the turnover of the Panama Canal from the USA to Panama ignited a boom in the Panama economy. Investment in Panama is prospering and real estate purchases are expected to appreciate for years to come.

Panama

Panama is the land bridge that connects North and South America. Fifty miles wide at it narrowest point this tropical country is the site of the Panama Canal. Roughly forty ships a day make the eight hour passage saving a trip around Cape Horn at the bottom of South America. Panama assumed control of the Panama Canal in 1999 after the USA built and then ran the canal from 1906.

Much of the strength of Panama's economy today is due to development projects directly linked to Panama's takeover of the Panama Canal.

Panama Economy

Panama's economy is based mostly on its mature services sector which accounts for nearly 80% of Panama's gross national product. Panama has a strong banking sector which started as a result of the Panama Canal. Today Panama's banking laws help ensure privacy for investors thus attracting capital to Panama.

Services associated with the Panama Canal include container ports, Panama's flagship registry, and the Colon Free Zone, the second largest duty free zone in the world.

Panama medical and health care services are also strong as is the insurance industry. Because of Panama's excellent health care and costs much below those in the USA medical tourism is an excellent investment opportunity in Panama.

Industry in Panama includes cement manufacture, textiles, and aircraft spare parts. However, with the current level of investment in the Panama economy the construction industry and real estate are especially attractive to investors.

Panama Real Estate

Panama real estate has been appreciating for the last ten years. The skyline of Panama City has changed substantially with the increasing number of skyscrapers. A current problem is the escalating cost of cement. Investment in real estate in Panama has paid dividends for a decade and is likely to be a good bet for years to come. There is talk of a high end real estate bubble, especially in the condo market.

Compared to 2000 just after the handover of the Canal when Panama's growth was two to three percent a year now it runs closer to 8 percent. Inflation is a social issue as the price of food has gone up with the cost of petroleum and the diversion of food stocks into bio fuels. Nevertheless Panama continues to grow and prosper. There is no talk of a bubble in the middle and low ends of the Panama real estate market. Investment in the construction industry is expected to pay dividends for years to come.

Panama Investment

Well chosen and developed real estate is still a great buy with excellent long term prospects in Panama. For example, the coast of Colon Province is expected to develop fairly rapidly once the new Panama Interoceanic Highway from Panama City to Colon is completed turning the current trip into an hour's commute.

The entire support and supply chain for the shipping industry is likely to prosper for years to come as the Panama Canal Expansion doubles Panama Canal capacity as will as the need for support services, and building to house those services.

Panama is a beautiful country with a first world infrastructure and areas of untouched natural beauty. If you are interested in living here, investing here, or both come and talk to us at ABPanama. We have over 23 years experience managing real estate portfolios and would love to help you prosper in Panama.