The Country of Panama

Intro to the Country of Panama

Stats For the Country of Panama

  • The population of Panama is roughly 3 and 1/2 million people of many diverse nationalities. The mix of many cultures is what makes Panama unique and interesting. Everyone is accepting of each others culture.
  • Panama’s mixed nationalities include  British, Irish, Dutch, French, Germans, Italians, Portuguese, Poles, Russians, Ukrainians,Chinese, Jamaican, West Indies, South Asians, Mestizo,Mulattoes and Native Indians.
  • Kuna are Panama’s indigenous people. They live on the Atlantic side of the country near the Columbia border in about 49 communities.
  • The land size is 78,200 square kilometers, which is slightly smaller than the state of South Carolina.
  • The government is a democratic republic with an elected president.
  • Panama has 9 provinces, with capitol cities of each.
  • Nine hundred rivers flow in Panama kept full by the rainy season that runs from May through November. Climatic changes here are measured more by rainfall amounts than heat.
  • Forty percent of the country is still wooded with multi-canopied rain forest. Volcán Barú is the tallest mountain in Panama at 11,398 ft and is just south of the Continental Divide which separates the country down the middle.
  • Panama is free from hurricanes and most tropic storms.
  • There is a sales tax of 7%  and a 10% sales tax on hotels. There is no income tax on money earned outside of the country. There is also no inheritance tax.
  • The Caribbean side of the country can get between 59-140 inches of rainfall annually, by contrast the Pacific side gets between 45-90 inches annually.
  • 90% of Panamanians are literate and higher education colleges boast an enrollment of over 100,000.
  • Health care is affordable with or without insurance. More on healthcare in the country of Panama here.
  • Crime in Panama is usually around Panama City and is mostly robberies, muggings and petty theft, and is frequently the result of gangs of which there are over 108 in the city.
  • Drug trafficking does exist here just like all Latin America countries, however the Panama Naval Forces as well as other law enforcement do a good job of keeping it under control. With Columbia as a next door neighbor, Panama is ever vigilant. Most of the Darren region of Panama that borders Columbia is un-populated by Panamanians, forming a safety zone.
  • Panamanians are generally good natured, warm and friendly. Most all are very accepting of  newcomers to their country.

Current Economic Information for the Country of Panama

Downtown Panama City

The country of Panama is a very diverse country. It’s Spanish colonial history  is apparent even beside the tall sky scrapers of Panama City.

Panamanians are proud of their heritage and yet celebrate their booming economy with new infrastructure every where you look. These people are adopting a North American lifestyle. Everywhere you look in Panama City and outlying areas, you can see evidence of western culture from McDonald’s to Anne Klein clothing stores.

Panama City as well as other larger communities boasts modern shopping malls and five star restaurants. Some of the malls in Panama City include:

They also have several large chain stores like  Home Depot and Costco. You don’t have to leave the country to find everything you are looking for.  With more and more shopping centers opening, everything you need is here.

Seems as if everyone here is also connected to the internet and has a cell phone. The new president is trying to make Panama a world recognized modern country. There is a plan in place to make free WiFi available to all in Panama.

This country is in a transformation, it now has the money to update any infrastructure a fast pace. The GDP for Panama in 2013 was 8.4% . The United States compared with 2.2%. So you can understand why the country continues to boom, build and renew.

Another fact quite amazing is 28 % of the population now is online. One of the biggest success businesses in Panama are electronic stores selling laptops and all tech gadgets.

Wikipedia photo by Romanrayala

Wikipedia photo by Romanrayala

The President since 2014 is Juan Carlos Varela. He was born in 1963 and been involved in politics since the early 1990’s.

Elected with 39% of the vote, this president promises change and good things for the country.

World banks have come to Panama to take advantage of the banking haven here and the influx of investors. As a result, Panama attracts more and more business people who are looking for a central place to have conventions and take advantage of the large airport that serves all of Latin and South America cities.

The trickle down of this activity has lead to more  well name hotels being built to accommodate people arriving for business and pleasure. One of the most recent additions is the Trump Ocean Club International.

The Country of Panama is Much More Than the Panama Canal

I could give you links to various websites telling of the history of this country and of the Panama Canal, however those are easy to find on your own. What I want to show you, is the diversity of the country itself and why I love it. National Geographic Map of Panama This is an interactive map where you can zoom in to find the small towns and beach communities.On the left of this map you will see the Panama City and above it Colon. Between these two cities is the Panama Canal. Which everyone knows from good old history books.
Most of the population of Panama live in Panama City. The rest of the population is mostly on the Pacific side of the country. Coronado is a bustling beach town where a lot of the city dwellers go for weekends. It has lots of hotels and restaurants and caters mostly to tourist trade, although more expats seem to settling in Coronado all the time. The same goes for the town of Gorgona that is close by.

My Personal Recommendation for Great Information on Panama

“To get to know ALL about Panama, Good and Bad please visit Live and Invest Overseas and subscribe to the Panama Letter. I have been a subscriber of the Panama Letter for a couple of years. It is a great source for specific information on different places in Panama that you can’t get any other way.  The news stories are directly from staff members who have visited these areas of Panama and reported back. The facts are always current and updated. If you are thinking about moving to Panama or even visiting, I would encourage you to subscribe. I have kept all my back copies and refer back to them often.”

Panama (Warts and All) 

 No marketing hype, no rose-colored glasses.

 That’s the promise of the Panama Letter.

 Panama is right now the world’s top retirement, investment, offshore, and doing business haven. To get the most out of this little country with such an abundance of upside right now, and to determine which opportunities might be right for you, you need to know the full story. You need to understand all the facts, straight, complete, and current.

 This is Panama without the sugar coating. From a team of expats, investors, and business people with, together, many decades of experience spending time and making money in the Hub of the Americas.

 Go Here Now For The Full Details


There are a number of cities and towns that expats have chosen as home in Panama. I hope to be able to tell you a little of each of them.

Anton El Valle

Anton el valle, El Velle de Anton a anochecer CRW 9713

Photo Courtesy of Garrison Gunter at Flickr

One of the earliest popular places to live for expats was in Anton El Valle. It is a small town of a population of around 9000,in the middle of an extinct volcanic crater. It is a noted place for wealthy Panamanians to have summer homes. You will find that this town is well taken care of  with groomed lawns on large lots with lots of shade trees. In looking at several realty sites, I would say that housing here is on the upper end.

The town consists of some small tourist hotels and  restaurants. One of the draws to this part of the country is the wonderful zoo that they have with native animals. I was lucky enough to visit on my first trip here.

The town is located in the hills and has an excellent climate, not to hot or cold. It is a great place if you want a quiet life as the nearest city of any size is miles away on a twisty two lane road that I would not recommend driving on at night. Although many expats choose to live here ( around 200), it seems a bit isolated for my tastes.  As a side note, most locals here do not speak English.You can find out more about Anton El Valle HERE. or watch these videos about El Valle.

You can also check out prices of houses at El Valle RealEstate

Altos Del Maria

As popularity of this region has grown, new gated subdivisions have sprung up. More and more expats as well as retired Panamanians seem to want to be inland a few miles to take advantage of the cooler year round weather. To that end, the subdivision of Altos del Maria has been a very popular option for those who want to be close to Panama City (1 hour 20 min) and 30 minutes to spectacular beaches  This subdivision offers seclusion with great views and close amenities. You can find out more about Altos del Maria  HERE. Or watch some videos.

You can also visit Panama Realtor for a look at availability of homes in Altos del Maria.

Coronado Beach

Coronado beach panama, Coronado Beach

Photo Courtesy of Colros at Flickr

Coronado is the ocean play ground for the Panama City dwellers on vacation as well as many expats. It is the closest town to Altos del Maria. It was the first ocean resort destination and now boasts upscale hotels, restaurants, shops, grocery stores, hospitals and much more. Coronado is not your quiet beach side community. So it is not a place for expats who want a quiet lifestyle. This is a happening place. Again remember no hurricanes here.

For more information on housing in Coronado look at U Realtors.

Bocas Del Toro

Isla Bastimientos Bocas Del Toro Panama

Photo Courtesy of Arturo Sotillo of Flickr

Bocas del Toro is actually a province in Panama. It is close to the Costa Rica border and is probably the second most visited place in Panama. Those who move here as expats usually choose  to live on Isle Colon which is the capitol of  Bocas del Toro . The province is made up of  9 islands, (not all inhabited) and part of the mainland. The best infrastructure in this province remains in Bocas Town with a population of around 13,000.

Bocas Del Toro’s small communities are touristy beach towns with several small hotels and hostels and local restaurants. Life moves slowly here . Several houses sit out over the ocean on pilings. There are only a couple of places in all the islands that have beaches. Most of the islands have mangroves around the shore. Most people here own boats. It is the only way to visit the other islands and get to the beaches.

Many expats have set up dive shops, restaurants and small hotels. If you love water sports, this would be an ideal place to be. From surfing, fishing to diving this area abounds in perfect waters for any sport. It also supports marine life as well as birds and mammals on different islands. However, it is far from any major cities. Bocas del Toro is remote although it can be reached by plane or a water taxi from the mainland. If you want seclusion in a tropic setting, this might be the place for you.

This part of Panama can be humid and hot.  Average high is 88 and average low 70. It can rain here a lot but it never stops the tourists from coming. You will find this part of Panama laid back with a Caribbean feel. In trying to find information about Bocas there is strangely little information even thought this is a popular destination. I have included some of my own pics from a visit here. Unfortunately when we were there, we had rain most of the time.You can find out more information about Bocas HERE.

Take a look at Bocas Paradise for more real estate information.

Boquete

Boquete panama, Overlooking Boquete

Photo Courtesy of Ken Mayer at Flickr

Boquete is situated in a lovely valley over shadowed by Volcan Baru in the province of Chiriqui.  Boquete itself has a population is just over 6000 with 14% being expats from around the world. The valley itself has many smaller towns which expats also live in, such as Alto Boquete,  Alto Lino, Dolega, Vocancito and Alto Jaramillo. This area of  Panama is now considered to have one of the largest expat communities in the world.

It is  about 40 minutes uphill from the city of David on a new 4 lane highway. It has year round spring like weather , with temperatures of highs in the low 80’s to lows in the low 70’s. It is located in the Provence of Chiriqui. Boquete attracts hikers, rock climbers, bird watchers and those who love flora and fauna as well as golfers and fishermen. It is a very diverse area with coffee plantations as well as growing crops of vegetables and fruits. A river runs through town, calmly during dry season and raging during rainy season. There is a lot to do here outdoors.

Boquete is considered, one of the largest communities of expats in the world. This is very evident with the amount of  expats who have started businesses here, Expats have started up businesses like bakeries, restaurants, tours, hostels and more. Boquete boasts its own local expat live theater, English online news, concerts and monthly expat meetings. It has grown to also be a  community which helps local charities and organizations.

It is possible to live here for under 1500 a month for 2 people. You can find rentals from 400-1300 depending on what you want, or you can buy. You can also live here without buying a car, as the local bus service and taxi’s are cheap and reliable. Crime in all areas that have a fair amount of expats is on the rise.  Make sure you take precautions just like you would in the United States, lock your doors and put out of sight your valuables.

If you do a search online for Boquete you will find literally dozens of expat websites from self blogs to helpful forums. It is a thriving place which is drawing people from around the world. This unfortunately, has made what was once a quiet community a very bustling one. Real estate prices are reflecting higher prices as properties are going fast. However, it is important to note that prices are still much lower than they would be in the United States and other countries.

The other nice thing about this area of Panama, is that you could get by without knowing much Spanish. I plan on learning because I think it is a courtesy to learn the language in your new country. Boquete takes care of that too. They have a well known Spanish school here teaching gringos Panama Spanish. Boquete also has several grocery stores, a doctor and most things you need on a day to day basis. But David which has a population of 120,000 is just a 35-40 minutes away where they have several hardware stores, department stores, furniture stores, large supermarkets, car lots, repair places, 2 hospitals with English speaking doctors, vets and basically anything you will need.

Living in the Boquete area you are also close to the beaches. So you can take day trips for fun. Here is a sample one of  the most popular Boquete’s expat sites.

There are several realtors in Boquete, however some are not licensed and are new. Most expats rely on people they trust in Boquete. Magda Crespo has earned that. Please check out Mcpanamarealty.com.

David

David panama, Crown Casino David2

Photo Courtesy of Future Expat at Flickr

This city in Chirqui has a population of around 120,000 and is the second largest city or the third largest, depending on who you talk to, in the country of Panama.

When expats first started coming to this region, most made their home in the Boquete area. But now that housing prices are increasing there, David has become a second choice for a lot of new expats. I have been told that David is the hottest and most humid city in Panama. Most of the year the humidity level is above 80% with daily highs around 87 and lows around 73. So you might want air conditioning in your home or condo. The upside though, is that everything is here within minutes of either side of town. Close and convenient are the words to describe reasons to live here.

Enrique Malek International Airport, David, Panama

Wikipedia photo courtesy of Jonnysioman

David has an International airport (Enrique Malek International Airport)  with the expansion complete and a new terminal, this area is soon to be open to more flights as demand increases.

 

Currently Air Panama flies to San Jose, Costa Rica and to Panama City to the Albrook airport. Copa just this year has started flights directly from David to Tocumen International Airport in Panama City. To track flights visit, Flight Stats

Besides the convenience of the airport, David is booming. Everywhere you look, new construction is going on from housing to new malls and stores.  David has two movie theaters(which shows movies in English and subtitled in Spanish), several car dealers, many huge hardware stores and even gourmet grocery stores.

David also has two private hospitals that have excellent care. They are Mae Lewis Hospital and the Chiriqui Hospital. These hospitals are also the nearest ones for anyone in the Chiriqui province including Boquete. As a side note I will cover more on health care and insurance in a blog post.

Another great thing about David is it’s closeness to beaches. Take a look at this video about coastal communities near David. Within twenty minutes of David you can be at La Barqueta Beach (with a 18 mile stretch of beach for  walking) or in 45 minutes you can be at Puerto Armuelles. Several of these communities are having expats move in and new developments are popping up along the beach communities. Remember no hurricanes in Panama.

Here are some videos to give you an idea of what David offers.

To get a perspective of what real estate is available in David you can visit Panama Real Estate Properties .

New Areas of Interest for Expats

As expats explore more of Panama, interest and developments are happening in several small towns which until now remained quiet and unnoticed. This can mean that you will find great prices on housing. Your cost of living in general will be less but may have to travel further for your grocery, banking and medical needs.  However the rewards of living in a smaller community include lower crime and more  involvement with the local population. Also  note that because most of these towns and cities are small, they will have very few people who speak English. So if you are entertaining the idea of looking at some of these, remember you would have to learn some Spanish to get by.

Some of these new finds include:

Las Tablas (Province of Los Santos)Article

Pedasi (Province of Los Santos)Article

Puerto Armuelles (Province of Chiriqui)Article

Boca Chica (Province of Chriqui)Article

Santa Fe (Province of Veraguas) Article

Aguadulce (Province of Cocle) Article

Rio Hato (Province of Cocle) Article

 Cost of Living in Panama

Panama City is obviously the most expensive place to live in the country. Most people live in the city in high rises, whether they are condos or rentals. Two people living in Panama City would need at least $2500 a month.

Many expats live in Panama City, because they want all the amenities a big city offers. Panama City does have a great night life, good restaurants, shopping, health care, opera and even golf courses. So that being said, I want to give you budgets for other places in Panama.

A typical budget for 2 living in Boquete, Chiriqui:

  • Rent $700
  • Electricity $50
  • Telephone/Internet $30
  • Water $5
  • Butane $2
  • Groceries $300
  • Cable $50
  • Eating out $100
  • Health Insurance $320
  • Transportation (Bus or Taxi) $30
  • Misc medical exp $75
  • Misc Expense $100
Total $1757
A typical budget for 2 living in Las Tablas:
  • Rent $300
  • Electricity $50
  • Telephone/Internet $50
  • Water $10
  • Butane $2
  • Groceries $200
  • Cable $50
  • Eating out $100
  • Health Insurance $320
  • Transportation (Bus or Taxi) $20
  • Misc medical exp $75
  • Misc expense $100
Total $1277

Panama Home Purchase Information

Yes, you can buy a home in Panama. The only restrictions are near the Costa Rica border. You are not allowed to purchase land or a home within 10 miles of the border with Costa Rica. There are many home options here. There are more and more gated communities popping up all over the country for those who want privacy and security. However, they pay a price usually with HOA fees. Then there are new smaller subdivisions, some with budget new homes and others with mansions.

Real estate here is a little different than the US. There is no MLS, therefore many different real estate companies can list the same home at different prices. You must do more than your usual due diligence when looking for and purchasing a home in Panama. There unfortunately are some people in the real estate business who are doing very unethical things. I would suggest finding references from expats or locals who have bought using real estate people. I would also recommend that in most cases don’t buy into a “project” that has turned over dirt yet.

Panama lawyers always recommend that you purchase your property with a Panama corporation. This is for a couple of reasons. One when you need to sell, you will not have to pay the transfer tax of 2%.  Also if 2 people are sharing ownership of a home and one dies, in Panama the home must go through probate. If you have a corporation, you avoid the probate issue. A corporation takes about two weeks to set up at a cost of $1100 and a yearly fee of $350.

You will also want to make sure that the title is clean and that it has title and is not a right of possession. Your attorney can do this for you. When you have decided on your home you need to then to sign the Promise to Purchase Agreement. It is basically there version of our escrow procedure. The amount you give as a down payment is usually 10%. If the seller backs out of the agreement he must pay you back 10% + another 10% as a penalty. If the buyer backed out they would lose their down payment to the seller. The balance of payment is to be made when the Promise to Purchase Agreement has been made a Buy Sale Contract and signed, inscribed in the public registry. Then the new deed is released from the public registry. All of this can take up to 45 days. There are no up front taxes paid on purchases of property in this country.

Property tax is paid in Panama.  However,  there is a 20 year property tax exemption for some properties. Here is how it works. The property building permit must have been issued before July 1, 2009 and the registration of improvements in the Public Registry must have been completed BEFORE December 31, 2011.

Also worth a note that property tax here is paid every four months (April, August and December).

So  if you buy a resale property, the remaining exemption time is transferred to you. For example, if you buy a residential property that was built in 2000, you won’t pay property tax on it until 2020. When you purchase your property make sure that you go to the  nearest Ministry of Economy and Finance  with a copy of your new title to get a statement from them  determining  when the 20 year exemption began to keep your records straight.  Just remember, land itself is not exempted and will continue to incur property taxes if its value is above $30,000.

Property Taxes Icon

Photo Courtesy of Daniel Moyle at Flicker

After the $30,000 exemption, property tax is as follows:

1.75% for property valued between $30,000 and $50,000 (That is the registered value of the property)

1.95% for property valued between $50,000 and $75,000 (That is the registered value of the property)

2.1% for property valued above $75,000 (That is the registered value of the property)

As an example: a home that has a registered value of $150,000 would pay:

150,000-first $30,000=$120,000 to be taxed

1.75% for $20,000=$350 (the tax on 30,000-50,000)

1.95% for $25,000=$487.50 (the tax on 50,000-75,000)

2.1%  for remaining $75,000=$1575.00

Add them up and your total bill per year would be $ 2412.50

If you volunteer to have your property reassessed you can get a much better tax rate, so for the same scenario:

$150,000- first $30,000=$120,000 to be taxed

.70%  for $20,000=$140.00

.90%  for $25,000=$225.00

1% for remaining $75,000 =$750

Add that up and your total bill per year would be $ 1115.00 saving you $1297.50.

Once you have done this, the government rarely looks at reassessing your property again. So virtually, you could pay the same amount  for years.

 

Country of Panama Residency Requirements As of  July 2012

If you are wanting to live in the country on a non resident basis or part time you should know that your “Tourist Card” which is stamped into your passport in immigration is only good for 90 days. Some people who live in countries year round take the chance of deportation when they try to use the Tourist Card as a way to stay in the country. They plan every 90 days to leave the country for 72 hours and come back in and get re stamped. Although this is not illegal (yet), I personally wouldn’t want to run the risk of not being able to come back into the country, especially if I had bought a home and all my worldly possessions were in it. And I further think Panama and other countries are very generous to keep letting people do that. If you are planning to spend more than a few months in any country abide by the laws and apply for residency.

The one thing you need to remember about all countries requirements is that they are constantly changing. Sometimes radically and overnight. So beware that when you have taken time to decide on a country to live in you MUST find out what the current requirements are and if any of the Visa’s will fit into your budget and finances.

You will also need to contact an attorney to get the REAL answers to Visa requirements.  Information you get on blogs, even mine can be old and not up to date. Please do not ruin your plans to move because you have left this part until the end of your search. Also of note, ALL VISA APPLICATIONS IN PANAMA MUST GO THROUGH AN ATTORNEY.

As of this writing, (and I will try to keep this current) there are several ways to be come a  permanent resident of Panama. This does not mean citizenship, this means you legally can live in the country and can take part in any perks that a Panamanian citizen can. That is different also between Visa’s.

PENSIONED RETIREMENT VISA

For those already retired and receiving Social Security or monthly payments from an annuity the best Visa remains the  Pensioned Retirement Visa or called in Panama (Pensionado Visa). The application process is easy, painless and fast compared to other Visa options.

1. You must be already receiving money from Social Security or an annuity. There is no age restriction for this Visa.

2. The amount of the income must  be at least 1,000 USD a month. This is good for a husband and wife. They may also pool 2 incomes for the result of $1000 a month. If you have purchased a home or property already for over $100,000( titled in your name), you can reduce the minimum amount required to $750.00 a month.

3. Benefits include being able to bring into Panama 10,000 USD worth of your belongings without paying duty. You can also import a car (not advisable) every two years with not duty paid. You can ship and import your belongings as soon as you have begun your Visa process. You just need to show your paperwork.

4. Most websites will tell you that the benefits and discounts for this Visa are the best in any country. What they neglect to tell you is that everyone who is a resident or citizen will receive these discounts. Women must by 55 and men must be 60. Even foreigners who apply under different Visa’s will receive the same discounts. Some of  the benefits for these people  include:

  • 30% off bus, boat, and train fares, 25% off airline tickets
  • 25% off monthly energy bills
  • 50% off entertainment anywhere in the country (movies, theaters, concerts, sporting events)
  • 30% to 50% off hotel stays
  • 15% off hospital bills if you have no insurance
  • 10% off prescription medicines if you have no insurance
  • 20% off medical consultations if you have no insurance
  • 15% off dental and eye exams if you have no insurance
  • 20% off professional and technical services
  • 50% off  the closing costs for home loans
This is a fairly easy Visa to get time wise and does not involve putting a lot of assets  into the country or banks in the country.
FORESTRY VISA
Another way to get a resident Visa in Panama is by purchasing 5 hectares (about 12 acres) of  Teak with an accredited ANAM company that will usually have a large track of forest specifically dedicated to growing teak for profit. The amount invested must be at least $80,000. This is the amount for 5 hectares. The investment itself is said to reap rewards of  around $500,000 when logged in 25 years. There are also small proceeds from thinnings done at age year 4, 8,12 and 18. This is part of the $500,000 total you can expect over the course of 25 years.
The government some time ago wanted to preserve teak forests by encouraging people to invest in growing teak for production and profit. To further this idea, they devised a Visa which offers the investor a permanent Visa for Panama.  Panama’s environmental protection agency,ANAM runs the teak projects ,which extensively goes through a ardent process for teak managers to be able to become accredited. When these teak plantations are accredited they are allowed to sell parcels of the plantations to investors who want to get a Visa. There are strict rules and guidelines for both the plantation owner and the Visa investor.
Several websites state that this is an easy quick way to get a Permanent Visa. That is not quite true. First you must hire an attorney.
1. Contact a company providing a Visa with a accredited Teak purchase.
2. Company will make up a contract with the specific lots that will be in your name or the name of your corporation. This will take around 4 months. You must have this done first and be able to show that you have the teak in your name. Your Panama attorney will look at the contracts to see if they are in order and done properly.
3. Then you can apply for your first temporaryVisa with your Panama attorney. This process usually takes 6 days or so. Then when the paperwork has been processed  a provisional visa is issued to you that is good for 3 to 4 months.
4.  Within 4 months of the expired provisional visa you and your attorney must go again to the immigration office again to apply for a 1 year provisional visa. This will take about 7 days.
5.  At the end of the 1st year visa, you must apply for a 2nd provisional one year visa with your attorney.
6.  At the end of the 2nd year visa, you must apply for a 3rd provisional  one year visa with your attorney.
7. After your third year of holding a provisional visa, you can apply for a permanent residency card, also done with your attorney.
So this process is not by any means short or cheap. Each application will cost a person around $1200 with a spouse at about half. You can do the math. I figured that by the end of the process (without a corporation) it would still run about 7-8 thousand dollars in immigration fees and attorney costs. With a corporation your yearly expenses can skyrocket.  Granted you can move here and bring your belongings in duty free after the first initial application for a provisional Visa.
As far as your teak plantation, once you purchase your 5 hectares, the plantation company will plant the teak trees and manage them for you until they can be harvested for timber (around 25) years. Also note that some companies will only give you 2.5 hectares of teak and keep the rest in their name.  And again also to note that companies charge differently for the maintenance of those trees. Some companies will charge a maintenance fee after 10 years on a yearly basis. Other companies will do the maintenance free in exchange for 20% of the harvest money when the trees are sold.
The time frame of 25 years before payoff for this investment would normally scare any investor, BUT if you are purchasing for a Visa, you can sell the trees to another investor after you receive your permanent Visa in about 5 years from purchase. Some not all, plantation companies will even let you sell the trees back to them for shares in the whole company allowing you to earn dividends on the entire plantation every year.
I personally looked seriously into this route, as I was not old enough to receive SS for the Visa above. Contrary to most old websites, there is now only ONE Forestry Visa available as of this writing. For your 5 hectares of teak, the Visa requires you make the purchase for $80,000. To make this purchase, you must do it through an attorney. The $80,000 goes directly to the teak plantation, it does not include any attorney fees upfront or ongoing fees down the road.
Having done due diligence on this Visa, I found out that depending on the company you invest your $80,000 with, your total costs, fees and eventual profit can vary greatly. Several websites suggest the only way to do this Visa  is by forming a corporation first which will hold title to the land.  However you must understand that the costs of having a corporation can be expensive. There are yearly costs as well as IRS forms  that need to be filed every year. This can run into thousands. You MUST look at more than one company and see which method of  overseeing your trees is best for you.
I am going to give you a video to watch about Teak Planatations and a couple of websites of teak companies accredited with ANAM.

Panama Forestry
United Nature

PANAMA SELF ECONOMIC SOLVENCY VISA
This is a pretty straightforward Visa. You must deposit a sum of $300,000 dollars USD in a Panama bank . Spouses and dependents must deposit an additional $2,000.

The Panama bank account must be in the form of a CD and must be for a 3 year term and in the name of the primary applicant (it can not be in a Panama corporation). The interest earned will be deposited monthly into a savings account. This income is not taxed by Panama, and is not subject to any tax reporting requirements.

You can also combine any equity you have in property(in your personal name) with the balance or entirety equaling $300,000. So if you bought a home for 150,000 cash you would need to put 150,000 plus 2000.00 into a CD for the balance.  In addition you will have to prove that you have enough money for cost of living.

The process is as follows for this Visa.

1. You must have documentation that you have a CD in the amount needed and or proof of property without any mortgage. Then the usual documentation of passport pictures, police record and health record. Your attorney will file for this residency. When doing so you will receive a temporary 3 month Visa, while immigration goes over you paperwork for a 2 year temporary immigrant visa. You will be issued a 2 year temporary immigrant visa after 3 months.

2. One month before your 2 year temporary visa expires you will need see your attorney to apply for your permanent immigrant visa. Again they will issue you a 3 month temporary visa until the paperwork has cleared and then you will be issued your permanent  immigrant visa. It is my understanding that at this time you are able to cash out your CD at the bank and will no longer be required to hold funds.

INVESTOR VISA

This visa is for anyone who is entertaining opening a business in Panama. You must have invested at least $160,000 in the business, plus another $2000 for dependent or spouse. The business must be in a Panama corporation and have a corporate bank account. In addition you must establish a Commercial License or Registry for the company.

You also must have at least 5 Panamanian employees working for the corporation. This must all be in place before you apply for residency. As this option is not for most folks reading this blog, I will not cover here the exact time line for this visa.

 

PERMANENT RESIDENCY FOR NATIONALS OF COUNTRIES FRIENDLY TO PANAMA-BRAND NEW VISA AS OF JUNE 2012

This visa was passed into law in June of 2012. It was an executive order 343. It took everyone by surprise. Because it is so new, the details are still coming out and of course there is already discrepancies between reporting websites.

Basically this is a permanent Visa that only citizens of certain countries can get. The United States is one of the countries, whose citizens can apply. It basically states that you can apply under the condition that you are going to practice some type of economic or professional activity in Panama. For several years, Panama has known it needed to  attract a much-needed foreign skilled work force. In order for Panama to continue to grow it decided to let anyone in who could contribute to the economy.

This Visa’s Requirements-According to What We Had to Do

This Visa basically has two steps and unless you are moving before you get your temporary Visa,  you will need to make two trips to Panama to visit your attorney.

On the first visit you must bring with you:

  • 5 passport photos- Men in shirts and ties, women in long sleeve shirts.
  • If married, a certified copy of your marriage certificate. This must be notarized and apostiled in the state you are living in.
  • Two bank reference letters to allow you and your attorney to open a bank account in Panama. This next part is very important. The bank reference letters must be 2 for each person, not couple. The bank reference letter must be on bank letterhead. Whoever signs the letter MUST also include their personal  telephone number, so that the bank can call that person to verify that they wrote the letter. The phone number CAN NOT BE a 1-800 number. It must be a number you can contact outside of the US.
  • Copies of last 2 years of federal tax returns for each person if not filing together. (Used for opening bank account).
  • An apositilled original FBI report for each applicant. (More on that process later).
  • Bring cash. Bring at least $5,000  in mixed bills. You will need cash to pay for many fees associated with your Visa application.
All of the documents above can no be more than 30 days old.
So on your first visit:
1.Your attorney will have hopefully set up an appointment at the US Embassy for you. This appoint is to have your drivers license’s verified. (Get 2 verifications for each person, 1 to use for Visa application and 1 to use later to get a Panama drivers license.) Total cost for 4 verified copies ran us $102.00. We paid by cash.
2. As soon as your drivers license’s are verified (takes about 1/2 hour if you have an early appointment) your attorney will take you to the Ministry of Foreign Relations where you will pay $2.oo cash for each person to have the verified drivers license apostilled. You will have to leave these documents and you or your attorney will pick them up the next day.
3. You and your attorney will work to set up a corporation. In our case the cost was $1100.00. One corporation can be set up for a couple.  It will take your attorney a little over a week to set this up.
4. You and your attorney will go to a Panama bank to set up a bank account for you. To set up a Panama account you will need the paperwork you brought with you. They will ask you for:
  • Copies of your federal returns
  • Bank reference letters
  • Copies of your passports
  • Your attorneys endorsement
  • A deposit (before applying for the Visa itself, the amount in the account must be at least $5000.)
It will take the bank approximately 4-5 days to verify your bank reference letters and set up an account for you.
Hopefully you have done most of this at the beginning of the week so that you can leave Panama with a bank account set up. If you are planning to stay another couple of weeks you can usually finish the application process and get your temporary visa. If not you can return anytime after your attorney says that your corporation has been set up.
On Second Trip ( or in about 2-3 weeks)

On this trip to Immigration make sure that you bring along your passports and a 5 dollar bill for each of the people applying.

Your attorney will make copies of your passports outside the immigration building where a stand is set up to make copies only. This will only cost about 60 cents. These copies are for you to use until your passports are returned to you in hopefully a few days.

During the first process of your application for your Panama Visa , your attorney will go to the Panama Immigration dept early to get a number so when you arrive, you wait until your number is called. Then your attorney will give all the paperwork to the immigration officer along with your original passports. You will be directed to the CAJA to pay $5 each for application fees. Then your attorney will take the receipts and give them to the officer. This process once your number is called is not long, however the wait time for your number to be called can take a couple of hours. The place is packed with people.

On the same day, your attorney may take you back to your bank you set up your Panama account in and ask them to give you a bank reference letter and a copy of a statement saying that you do have at least $5000 in the account. You will also need to have the bank do 2 certified checks for you. These are for your application fees for your Visa’s. The checks must be for $1600 and one for $500.  You will give these documents and the checks to your attorney.

Usually 2 days later (hopefully), you and your attorney will be at immigration again. Your attorney will again get a number and you wait. Your attorney will go up to the window with the checks, letter and statement. By this time you are already in the system. This process takes less time than the first time. You also need to bring a fifty dollar bill for each person applying and again go to the CAJA and get a receipt. Your attorney will have done all the necessary paperwork and discussion with the immigration person. Your attorney will have gotten a number for you to wait to get your picture taken for your new Panama temporary Visa. When your number is called you go into the small room hand the person your passport, receipt and they take your picture. You wait a couple of minutes and you are handed your temporary Visa. This is good for 1 year. In that time you should have you permanent CEDULA. You can now get a drivers license which will be coordinated for 1 year to match the ending date on your temporary Visa. When you have your CEDULA you can update your drivers license so it won’t expire for 4 or 5 years. DONE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Except: If you plan on leaving the country FOR ANY REASON you will need to get a multi entry exit visa. We did not do that. We decided that if we needed to we can get that done in David. Our attorney said it should not take more than a couple of days to do. Please note:

YOU CAN NOT LEAVE PANAMA WITHOUT A MULTI ENTRY/EXIT  VISA. THE FINE IS $2000. ALONG WITH SEVERAL PROBLEMS WHEN YOU DO DECIDE TO RETURN.

In conclusion:

Cost:

  1. Attorney Fees around $2000
  2. Corporation Fees $1100 upfront and $300 per year if you decide to keep it after you get your permanent Visa
  3. Fees for Application and misc in Panama $2316
  4. Fees for FBI record, fingerprinting, apostilling documents, shipping documents, approximately $150
  5. Bank account amount $5000
So basically this Visa will run you around $10,550. Not bad considering all the other options for a  Panama Visa. Plus this Visa does not require any additional provisions with respect to yearly renewals. Also, although it took us longer than expected, this Visa can be done fairly quickly unlike the other Visa options. Also consider that really the cost is only $5,550. You can of course use the $5000 in the bank account you set up, it is yours.

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2 thoughts on “The Country of Panama

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