Panama Country Report
President Juan Carlos Varela is unlikely to affect Panama’s business-friendly operational environment. His Panameñista Party (Partido Panameñista: PP) is politically centrist and Varela himself is a businessman (from the liquor sector). His party does not hold a majority in the national assembly so policy compromises are likely. There is a moderate risk of contract revision to businesses connected with the Odebrecht bribery scandal, which are facing higher levels of scrutiny. Panama enjoys a robust investment protection legal framework. IHS Markit expects GDP to grow 4.3% in 2018.
The operational environment is adequate. New businesses can be created through a substantially streamlined online system, and multinational legislation that facilitates the establishment of headquarters or regional affiliates in the country is in place. Investment in infrastructure will improve transport and communications systems, which are already considered good by developing-country standards. Corruption is common, however, and some labour regulations are inflexible. Following the completion of the Panama Canal expansion in June 2016, continued development of the canal and related infrastructure remains essential for the country to retain its position as a major transit point for shipping and global trade.
Terrorism risks remain low in Panama. There are no domestic groups with the intention or capability to undertake insurgent attacks. However, members of Colombian guerrilla group FARC who are refusing to disarm are increasing drug trafficking activity in Darién province. The Chiriquí province has a strong presence of criminal groups and drug-trafficking organisations, but these are unlikely to target foreign assets or foreign individuals. Criminal gangs operate in Panama City and Colón, raising the risk of violent robbery and express kidnapping. Vessels entering the Panama Canal face a low risk of piracy.
The risk of interstate war is low. There are no pending boundary disputes, but Panama's Darién region along the Colombian border has been affected by a spillover of operations by Colombian insurgent group FARC – now mainly involving those refusing to disarm – and illegal migration. There is no risk of war with Colombia, with both countries enjoying good relations overall. Panama has been involved in only one interstate war since independence in 1903, in the 1989 US invasion to depose the military government of Manuel Noriega.
Hydroelectric and mining projects are likely to face protests from indigenous communities, unions, and social activists. A law passed in 2012 banned mining activity in indigenous territories and introduced mandatory consultation processes for future hydroelectric projects in the Ngäbe-Buglé indigenous region, increasing the risk of protests against future projects; in particular the Barro Blanco project that is awaiting approval from Ngäbe-Buglé leaders. Protests often take the form of roadblocks on access roads, including the Pan-American Highway and light vandalism against company property and vehicles.
Vaccinations required to enter the country
Proof of vaccination against yellow fever is required for all individuals traveling from a country with risk of yellow fever transmission.
Hepatitis A: A vaccine is available for anyone over one year of age. The vaccine may not be effective for certain people, e.g. those born before 1945 and who lived as a child in a developing country and/or have a past history of jaundice (icterus). These people can instead get a shot of immune globulin (IG) to boost their immunity against the disease.
Hepatitis B: A vaccine is available for children at least two months old.
Diphtheria-Tetanus-Polio: A booster shot should be administered if necessary (once every ten years).
Yellow Fever: A vaccine is available for children over the age of one year.
Typhoid Fever: If your travels take you to regions with poor sanitary conditions (for children two years old and up).
Rabies: For prolonged stays in an isolated region (for children from when they can walk).
Meningococcal Meningitis: For prolonged stays, or in case your travels will put you in close contact with a local population affected by an epidemic of the disease (for children over the age of two years).
Malaria: Recommended preventive medication - mefloquine (sometimes marketed as Lariam) or doxycycline (sometimes marketed as Vibramycin).
For Children: All standard childhood immunizations should be up-to-date. In the case of a long stay, the BCG vaccine is recommended for children over one month and the MMR (measles-mumps-rubella) vaccine for children over nine months.
The Atlantic hurricane season lasts from June 1 until November 30. While hurricanes and tropical storms rarely hit Panama directly, storm systems can bring torrential rains, leading to flooding and landslides. Hurricane Otto lingered off the northern coast for several days in November 2016, resulting in at least ten deaths and an estimated USD 10 million in damages, prompting the government to decree a six-month state of emergency.
Mountainous areas of the country can prove dangerous, particularly during the long rainy season - which extends from March until December - due to flooding, mudslides, and subsequent road closures. Flooding also occurs within Panama City and can result in transportation chaos.
Panama is located in a seismically active zone and earthquakes occasionally occur. A 7.7-magnitude earthquake struck neighboring Costa Rica in 1991, leaving dozens dead and resulting in major infrastructural damage in the Panamanian province of Bocas del Toro.
Cases of taxi drivers robbing kidnapping and/or robbing their clients have been reported, and offending drivers may be armed. To minimize this risk, only use official taxis (yellow in color), never take a taxi with tinted windows, ensure that the car's license plate as well as the drivers credentials are visible, and never take a taxi that already has an occupant (potential accomplice) or allow drivers to pick up more clients (a common practice).
Larger highways are generally well maintained but secondary roads are often less so. Traffic accidents are common along the Pan-American Highway, which should be avoided when possible after nightfall. According to one study, Panama is one of the worst countries in the world for drivers, due to poorly maintained roads and heavy traffic.
In the Panama City region, the metro bus system is safe.
Flooding, particularly common from April to December, can leave roads impassable (see NATURAL RISKS section).
For intercity travel, long distance buses and domestic airlines are safe.
Panama's climate is tropical; the dry season extends from January until April and the rainy season from May until December. The coast receives more rainfall than the interior of the country. Along the plains, temperatures fluctuate between 20°C and 30°C and tend to be lower in mountainous areas (10°C to 18°C).
Voltage: 110 V ~ 60 Hz