Panama

Flag of Panama

Language: Spanish
Currency: Balboa (PAB)
Calling Code: +507

 

Panama is the southernmost country in Central America. It borders Colombia to the east and Costa Rica to the west. Panama is best known for the Panama Canal. But Panama has more to offer than just the canal. Panama has wonderful beaches on both the Caribbean and Pacific coasts and the country is full of national parks and tropical rainforests. Panama is a true bird paradise and particularly popular with bird watchers. But water sports enthusiasts and nature lovers will also get their money's worth in Panama.

 

Regions

Administrative division: ten provinces (provincias, singular - provincia) and five territories (comarca): Bocas del Toro, Chiriquí, Coclé, Colón, Darién, Emberá, Herrera, Kuna Yala, Los Santos, Madugandí, Ngöbe-Buglé , Panamá, Panamá Oeste, Veraguas and Wargandí.

 

Cities

Panama City – capital
Colón
David
Santiago de Veraguas
Penonomé
Changuinola

 

Other destinations

Bocas del Toro – archipelago off the Caribbean coast
Boquete – lively mountain town next to the Barú volcano with coffee plantations
Volcán – mountain town below the Barú volcano
Cerro Punta – high in the mountains on the edge of the Cloud forest with fruit and flower cultivation
El Valle de Antón
Santa Fé - still quiet mountain town
Las Lajas - extensive beach
Isla Taboga - island, an hour's boat ride from Panama City.
Islas de las Perlas
Portobelo

Cerro Hoya National Park is a nature preserve in Panama, situated 1.2 mi West of Jobero in Panama.

Chagres National Park is a protected area in the Panama province in the central Panama. It covers a total area of 129,000 ha.

Darien National Park is UNESCO biosphere reserve situated in the South East Panama. It covers an area of 5,790 sq km.

Chiriqui Gulf Marine National Park is a marine nature reserve that protects an area of Chiriqui Gulf in the South West Panama.

Isla Bastimentos National Park is a nature reserve situated in the Bocas del Tora District of Panama.

Isla Coiba National Park covers an island of Coiba. It covers an area of 503 sq km in the Montijo District of Panama.

La Amistad International Park is a UNESCO World Heritage Site in the North West Panama. It covers an area of 1992 sq km.

Metropolitan Nature Park is a nature reserve situated within borders of a Panama City in the Ancon district.

Omar Torrijos National Park is a nature reserve situated 31 mi Northwest of Penonome, 5 mi Northwest of El Cope in Panama.

Panama Canal was finished in the early twentieth century unites Atlantic and Pacific Oceans and instantly became a symbol of human progress and ingenuity.

Panama Viejo is a former old Panama City. Today it is situated in its suburbs of the modern capital of Panama.

Soberania National Park is situated 25 km (16 mi) from Panama City in Colón, Panamá provinces in Panama.

Volcán Barú is an active stratovolcano situated in the Chiriquí Province in Panama that opens a great view of Atlantic and Pacific Oceans.

 

Getting here

To enter Panama, EU citizens and Swiss citizens need a passport that is valid for at least three months. Officially, a valid return or onward ticket is also required, but this is rarely checked, especially at the international airport in Panama City. However, this is checked when entering the country overland from Costa Rica. It is also necessary to have at least $500 in cash or a credit card. Entry overland from Colombia is currently not possible. There is no road between Panama and Colombia, only the Bn Trek (a narrow path through the middle of the rainforest). However, crossing this path is extremely dangerous and many European countries warn against crossing it because Colombian paramilitaries keep advancing and there are also frequent skirmishes with Panamanian border units.

By plane
Panama has three international airports: Tocumen International Airport near Panama City, and the airports in David and Bocas del Toro, which are only served by flights from San José in Costa Rica.

Most European tourists who arrive by plane will therefore arrive in Panama City. From Europe, Condor flies via Santo Domingo and from November 16, 2015 Lufthansa flies directly from Frankfurt, KLM from Amsterdam and Iberia from Madrid to Panama. Otherwise, you can also fly to Panama with Lufthansa, Air France or other airlines via the USA, Colombia or Venezuela. There are regular direct flights from many Central American countries, South American countries and the United States. From Colombia, the only safe way to travel is by plane.

By train
Unfortunately, it is not possible to travel by train.

By bus
Traveling by bus from Costa Rica is no problem. There are several direct buses from San José to David or Panama City every day. You drive on the Pan-American Highway via the Paso Canoas border crossing. The border controls are usually stricter than at the airport, an exit ticket from Panama is often required, which can also be a return bus ticket to Costa Rica.

Alternatively, you can take buses from Costa Rica to the border. From there, buses to David leave every few minutes.

After Bocas del Toro, it is better to take the Sixaola/Guabito border crossing. Instead of taking the direct bus from San José, it is better to take local buses from Cahuita or Puerto Viejo de Talamanca to Sixaola, cross the adventurous bridge on foot to Guabito (don't forget the border formalities) and continue by bus or taxi to Changuinola. The border crossing closes at 6 p.m. (5 a.m. Costa Rican time).

By road
You can also travel from Costa Rica by car. The best way to travel is via the border crossing in Paso Canoas. The border crossing is open daily from 7:00 a.m. to 11:00 p.m., although the times are constantly changing. Another border crossing on the Pacific side is at Rio Sereno, from there the road leads to Volcán.

On the Caribbean side there is the border crossing over the Río Sixaola to Guabito and further into the province of Bocas del Toro.

On foot
The possibility of crossing the Colombian border on the Atlantic coast is described in the country's article. Motorboats also travel here, but there is no road.

By ship
It is theoretically possible to travel by ship from Colombia. The ferries between Colón and Cartagena were discontinued in 2015.

There are many cargo ships that take passengers on board for a fee. However, it should be warned that these are often drug transports. If such a ship is caught by the police, the chances of avoiding a prison sentence are very slim, even for tourists. It doesn't matter whether you knew about the drugs or not. There is, however, an alternative to the "drug ships". In some accommodations, especially in youth hostels, you can often find advertisements from travelers who are traveling to Colombia on their private sailing ship and are looking for passengers. There are also now a number of sailing boats that regularly operate the Panama - Cartagena route (with a 2-day stopover in San Blas), but charge between US$300 and US$400, depending on the equipment and service.

 

Transport around the country

Airplane: The national airline Air Panama has a very dense network of routes and flies to almost all regions in Panama. Due to the small size of the country, flights are not very expensive (maximum around 100 Balboa = US dollars), and Isla Contadora or some places in Kuna Yala, for example, can only be reached by plane.

Domestic flights do not depart from Tocumen International Airport, but rather from Albrook near the center of Panama City.

Train: There is only one train line in all of Panama, namely the one between Panama City and Colón. The journey on this train is very expensive. A one-way ticket costs 20 dollars, the return ticket costs 35 dollars. For comparison: the one-way flight ticket between the two cities costs 27 dollars and the bus costs two dollars. The route is a tourist highlight, however. It runs along the canal and at times you drive through dense jungle. The journey takes an hour.

Bus: The bus system in Panama works very well and buses go to almost every place. Proper bus stations are only found in the larger cities, such as Panama City or David. In smaller cities, you have to ask which street you can stop buses on. A hand signal is enough and the buses will stop. You can also get off anywhere along the way; all you have to do is shout "Parada (por favor)!" ("Stop, please"). If you are driving to an unfamiliar city, you should tell the bus driver roughly where you want to go so that he can show you the best place to get off. If you are traveling around Panama without a rental car, you will not be able to avoid buses. The rides are very cheap; short journeys within towns cost around $0.50 (balboa), to be paid when you get off. For longer journeys on intercity buses, tickets can usually be bought in advance at the bus station - depending on the distance, they cost between five and 25 dollars. Bus, boat and train schedules can be found at thebusschedule.com.

The central bus station, Gran Terminal de Transportes, is located near the domestic airport in Albrook. Many places can be reached directly from there. Since most buses stop along the way, you can also take buses that pass through your destination. Smaller places can be reached from the provincial capitals. The American "school buses" hardly ever go there anymore (they only exist in Panama City's city traffic), they have been replaced by minibuses. Even in small villages there are often "buses", which are sometimes shared taxis or pickups. After dark it becomes difficult or even impossible to find buses.

Car: Driving in Panama is generally problem-free. The roads are relatively well developed by Central American standards. However, it can happen from time to time, especially between May and October, that roads are closed due to flooding. In the event of an accident, the police must be notified in any case. It is better not to drive at night because many roads are full of potholes. The main route from Panama City to Costa Rica is four lanes except for the section from Santiago de Veraguas to David, but west of Santiago there are about 30-40 km of very bumpy roads. The signage leaves a lot to be desired, there are no signs even for smaller towns, and almost never for villages. Asking at gas stations or bus stops in good time can avoid some detours.

On motorways, 100 km/h is permitted, on country roads 80 km/h, and in towns 40 km/h. Gas costs (as of early 2013) about 4 Balboa = US dollars per gallon.

Rental cars in Panama are apparently cheap, with local companies offering them for as little as 10 US dollars. However, the insurance coverage is not sufficient. Liability insurance is usually limited to $12,500 (even with internationally known rental companies), and the deductible for accidents, theft or hit-and-runs for the rental car is several thousand dollars. The additional insurance policies offered have various exclusions (windshield, tires, everything on the outside of the car) and are very expensive: many times the rental price! With the exception of Sixt (very expensive), the terms and conditions on the homepages are hardly understandable, and even calls do not provide complete clarity. An alternative to booking directly with the car rental companies are intermediaries such as sunnycars.com, rentalcars.com or holidaycars.com, they offer more comprehensive insurance cover that kicks in if Avis, Hertz, Alamo, etc. have claims.

Ship: Traveling by ship is very important in Panama. There are many islands that can only be reached by scheduled ship or water taxis. Fishermen often take you from one island to another in their boats.

 

Language

Traveling through Panama is relatively difficult without Spanish. English is only spoken on the islands of Bocas del Toro and in or near the capital. You can also find people who speak English in Panama City and Boquete. But hardly anyone speaks English anywhere else. Our Spanish phrasebook is a little help.

 

Shopping

Shopping is generally not a problem in Panama City, the shopping options are hardly different from those in European cities. Even in the countryside you can usually find good supermarkets where you can buy items for everyday needs. Only in very remote villages can you usually only find the bare necessities.

Popular souvenirs are the Mola and the Panama hat. The Mola is a handmade embroidery that embellishes the blouses of the Kuna Indians. The Kuna sell the Mola all over Panama. A popular place to buy the Mola and other handicrafts is El Valle. The Panama hat, which actually comes from Ecuador, is sold all over Panama and is the traditional headgear of men in Panama.

The national currency in Panama is the US dollar. Although there is the Balboa, it only exists in coin form and is pegged 1:1 to the US dollar. The coins also look the same shape as the US dollar coins. Credit cards are mostly accepted in the capital and tourist centers (especially Visa and Mastercard), but in more remote areas you should always have enough cash with you.

 

Eat

The cuisine is similar to Colombian. Beef and pork are eaten, as well as lots of chicken and fish. Every dish is served with rice and a legume, i.e. beans or lentils. Yucca (similar to potatoes, but a bit more fibrous) and platanos (plantains) are also very popular. A lot of food is fried, and fresh salads and good vegetables are only available in restaurants and supermarkets, as Panamanians don't eat much of them themselves. Most of the food is not spicy, and usually only a little salt is used. Tropical fruits and fruit drinks or batidos (fruit drinks with milk) are all the more delicious and can be bought and consumed without hesitation almost anywhere.

 

Drink

Panama City is the best place to go out. There is always something going on here and there are numerous clubs, bars and discos. Cinemas and theaters are also easiest to find in the capital. The restaurant and night guide http://www.hastatarde.com always tells you what is going on where. In the countryside there are usually only a few bars and in the evenings these are reserved for local men. Women are not welcome there unless they are prostitutes, and strangers are also treated with reserve. But in the towns and villages where people have slowly become accustomed to tourists, you will always find somewhere to spend an evening.

 

Hotels

Panama offers hotels for every budget. From international luxury chains to simple youth hostels, everything can be found in Panama. There are a number of hotels, especially in the capital. But there is no shortage of hotel rooms in the country either. Advance reservations are usually not necessary. Only in the lower price ranges are they sometimes in short supply. You should also make advance reservations on Bocas del Toro, as there are a lot of tourists there and hotel rooms can be in short supply at certain times.

The quality of the hotel rooms is usually OK. If you are travelling as a backpacker, we recommend staying in one of the city's backpacker hostels, for example the Zulys Backpackers Hostel, a German-Panamanian run youth hostel in the centre of Panama City. In the capital, you should generally be careful not to end up in a short-stay hotel, as these are relatively common.

 

Learning

In Panama City, the Centro Cultural Aleman offers Spanish courses tailored to customer needs. The school materials are in German (Langenscheidt), but the courses can also be attended by non-German speakers. The school is located in the UDI, Universidad del Istmo, Justo Arosemena in the Bella Vista district. It is run by a German and a Swiss woman who have been living in Panama for several years. Information at www.spanischinpanama.com.

 

Safety

The dangers for tourists in Panama are relatively low. Crime against tourists is rather uncommon throughout the country. Of course, opportunistic theft can also occur here. Normal safety precautions that should be taken on every trip are sufficient, however. Tourists should only avoid a few districts in Panama City, in Colón and the border region with Colombia. Kidnappings by Colombian paramilitaries are a frequent occurrence, particularly near the border with Colombia. Unfortunately, the Panamanian authorities are relatively powerless in the face of this problem.

 

Health

Some uninformed visitors are often overly afraid of malaria. However, medical precautions are not necessary unless you are hiking in remote regions. The most dangerous form of malaria, tropical malaria, only occurs in the Darién province in Panama. The best protection against malaria is to avoid mosquito bites. It is best to always hike with long trousers and long-sleeved clothing. However, because of the heat, this is not always possible or not very convenient, so you should definitely use a good insect repellent. The tap water is safe to drink, except in the provinces of Darién and Bocas del Toro. The greatest health risk in Panama certainly comes from the sun. Lighter skin types in particular should definitely take a sunscreen with a high sun protection factor with them.

 

Climate and travel time

The climate is tropical with only two seasons: dry season (summer) and rainy season (winter). The dry season is from January to April, temperatures from 28 to 36 degrees Celsius, a constant breeze and not as high humidity as in winter. The rainy season is from May to around mid-December, with little rain at first, only about 1-2 hours every 2-3 days, but this intensifies by November and then it can rain for days. The humidity in the rainy season can be up to 93%, temperatures from 26 to 34 degrees Celsius.

 

Respect

In Panama, a lot of importance is placed on appearance. People wearing shorts are a rarity, especially in the capital. People won't look at you strangely if you walk around in shorts, but you are clearly identified as a tourist. If you plan to visit a club in Panama City, elegant shoes, nice trousers and a shirt should definitely be in your luggage.

In Panama, things are very formal, especially in public areas, so you should always use the polite form when addressing people.

 

History

The history of Panama covers the developments in the territory of the Republic of Panama from prehistory to the present day.

 

Pre-Columbian period

The history of Panama is characterized by a rich pre-Columbian heritage that spans more than 12,000 years. The oldest traces of these indigenous peoples include arrowheads. The first villages in America where pottery was made were in central Panama, such as the Monagrillo culture in the period from 2500 to 1700 BC. From these, important settlements developed, the fame of which results from the graves of the Conte archaeological site (500-900 AD) and the polychrome pottery of the Coclé style.

 

The Conquista and the early colonial period

In 1501, Rodrigo de Bastidas from Seville, who accompanied Christopher Columbus on his second voyage to America, set out from the Atlantic coast of what is now Colombia to map the coastline of the Caribbean Sea. He reached La Punta de Manzanillo on Panama's upper Caribbean coast before having to return to Santo Domingo due to the poor condition of the ship. He is considered the first European to claim this part of the isthmus, the area of ​​today's Guna Yala. Before the arrival of the Europeans, Panama was largely populated by the Chibcha and Chocoa peoples, the largest group of whom were the Cueva. A year after de Bastidas' arrival in Panama, Christopher Columbus sailed south from what are now Honduras and Costa Rica to the isthmus. During this time, Columbus made maps of the Panamanian coastline and, unlike de Bastida, explored the western part of Panama. He landed at a place called Almirante and advanced into an area he called Veragua (English: see water). He continued his coastal journey to the Río Chagres, landed in Portobelo, a natural bay that would become an important Caribbean port for the Spanish fleet in 1597, and finally ended his explorations in Del Retrete after spending only two months in the area of ​​present-day Panama.

Vasco Núñez de Balboa, a companion of de Bastidas, followed reports from the indigenous population in 1513 that there was another ocean to the west. Balboa and a troop of 190 men managed to make the difficult crossing of the isthmus between the Atlantic and Pacific. He called the ocean, which he was the first European to see on September 25, 1513, Mar del Sur (South Sea). Later, however, the name Pacific prevailed, which goes back to the first circumnavigation of the world under Ferdinand Magellan.

Panama City became the center of colonial Panama. Founded in 1519 by Pedro Arias Dávila, it soon became the seat of the Audiencia and bishopric. The city, located in the most geographically suitable position for interoceanic trade - although in an unfavorable topographical location - became an important transshipment point on the route between Peru and Spain. Gold and silver were brought to Panama by sea and from there transported overland to the Caribbean coast and from there shipped on to Spain. A system with two routes developed: the Camino Real (English: Royal Way), on which the gold and silver were transported on the backs of mules during the dry season from December to April, and the Camino de Cruces (English: Way of the Crosses), which led from Panama City overland to Venta de Cruces, where the goods were loaded onto boats and taken to the mouth of the Chagres River. The Camino de Cruces was used for general goods traffic, especially during the rainy season. The origin of the name Camino de Cruces is derived from the cross-shaped form of the road paving.

The success of Spanish rule was in sharp contrast to the oppression of the indigenous peoples. A few years after the conquest, the indigenous peoples were largely exterminated. In the late 17th century, for example, the culture of the Cueva had completely disappeared. The missing workforce was replaced primarily by African slaves, who were deported to Panama in large numbers from the 16th century onwards. Harsh working conditions and poor treatment were the triggers for frequent slave uprisings. Slaves who escaped into the hinterland, so-called Cimarrones, founded their own settlements and from there waged a kind of guerrilla war against the Spanish, often in alliance with members of indigenous peoples, such as under the African leader Bayano in the 1550s. Sometimes there were even alliances with pirates, such as in 1573, when Cimarrones supported the English privateer Francis Drake in attacks on Spanish silver transports near Nombre de Dios.

In 1671, Panamá la Vieja was destroyed by the English pirate Henry Morgan. He crossed the isthmus and attacked the city from the land side, which was then rebuilt ten kilometers away in a more suitable location.

A Scottish attempt to establish the colony of New Caledonia on the Gulf of Darién at the end of the 17th century and to transport goods from there across the isthmus, the so-called Darién Project, failed despite high investments. The banker William Paterson (1658–1719) had raised 400,000 pounds for the project, but in the end half of the Scottish national wealth flowed into the unsuccessful venture.

Panama was under Spanish rule from 1538 to 1821 (Viceroyalty of New Granada), and its fate was closely linked to the geopolitical importance of the isthmus for the Spanish crown. Panama's importance declined considerably at the end of the 17th century and almost disappeared completely in the middle of the 18th century, when Spain's power and influence in Europe waned and Spanish ships mostly sailed around Cape Horn to reach the Pacific. The route via Panama was short, but also labor-intensive and expensive, especially because of the multiple cargo transfers and the complex land transport. In addition, the route via Panama was threatened by (mostly Dutch and English) pirates and cimarrones.

 

Panama since the 19th century

The general desire for independence in the colonies on the American continent did not initially affect Panama. It was not until 1820 - after the arrival of the first printing press - that discussions about possible independence from the Spanish crown intensified. The climax of these discussions was the Primer Grito de Independencia en la Villa de Los Santos, with which the city of La Villa de Los Santos declared its independence. The conservative elites in Veraguas and Panama City opposed this declaration. Among those who rejected independence was the commander of the armed forces, José de Fábrega, who the supporters of independence were able to win over to their side. Fábrega called a meeting of representatives from all Panamanian cities, where Panama declared its independence from Spain on November 28, 1821, and at the same time joined the Viceroyalty of New Granada. In this way, Panama - unlike its neighboring states - achieved its separation from Spain without bloodshed. In September 1830, Panama seceded from the rest of Gran Colombia under the leadership of General José Domingo Espinar, the local military commander who rebelled against the central government over a transfer. The condition for rejoining was the direct rule of Simón Bolívar. Bolívar rejected Espinar's demands and in turn demanded that the province submit to the central government again. Amid general political tensions in Gran Colombia's final days, General Juan Eligio Alzuru staged a coup against Espinar's authority. In early 1831, Panama rejoined what had once been Gran Colombia, becoming part of a new union called the Republic of New Granada.

In July 1831, when the new states of Venezuela and Ecuador were constituted, the Isthmus again declared its independence, this time under the leadership of General Alzuru as military commander-in-chief. The abuse of power by the short-lived Alzuru administration provoked military countermeasures under Colonel Tomás de Herrera. After Alzuru's defeat and execution in August, the old ties with New Granada were restored. In November 1840, during a civil war that arose from a religious conflict, several local authorities declared their independence, followed by General Herrera for the Isthmus. Panama was named Estado Libre del Istmo, in English: Free State of the Isthmus. This new state established some foreign policy and economic ties and in March 1841 a constitution was passed that opened up the possibility of reunification with New Granada within a federal system. After the end of the civil war, negotiations were held with the New Granada government about reunification on December 31, 1841. The Isthmus was independent for a total of 13 months.

As was often the case in the New World, the political and administrative structures after independence were controlled by the descendants of the colonial aristocracy. In the case of Panama, this elite was made up of ten extended family circles. Although Panama has made considerable progress in the permeability of social classes and the integration of minorities, Panama's economic and social life is still controlled by a small number of families. The derogatory term of unknown origin rabiblanco, which means white tail, has been used for generations for the members of these white families.

In 1852, the Isthmus adopted the trial by jury principle for court proceedings, i.e. a jury decides on guilt and innocence, and 30 years after the international abolition of slavery, Panama also declared it to be an end and has fought against it ever since. In 1855, the first transcontinental railway line in the New World was opened, the Panama Railway, which runs from Colón to Panama City, in order to be able to transport fortune hunters who were on their way to the gold fields in California quickly to the Pacific. The existence of this railway line made it possible to seriously consider a Panama Canal.

 

Recent Panamanian History/Canal Construction

Modern Panamanian history has been dominated by trade across the isthmus and the possibility of building a canal to replace the difficult overland route. In the 1520s and 1530s, the Spanish crown commissioned studies on the feasibility of building a canal across the isthmus, but the idea was soon abandoned. Between 1880 and 1889, the French Compagnie Universelle du Canal Interocéanique, led by Ferdinand de Lesseps, who had successfully built the Suez Canal, attempted to build a trans-Panamanian canal at sea level. However, the company faced insurmountable health problems, such as epidemics of yellow fever and malaria, as well as engineering challenges, such as frequent landslides and very soft ground. The company eventually failed in a spectacular financial collapse, which not only bankrupted many French financiers, but also resulted in prison sentences. In 1894, a new company was founded to make up for some of the losses of the original canal construction company.

 

Panama conflict

US President Theodore Roosevelt convinced Congress to take over the unfinished and abandoned work in 1902. The USA then demanded that the Isthmus be handed over to Colombia. Colombia refused to hand it over, however, and President Roosevelt sent the US warship USS Nashville there in 1903. The American soldiers went ashore, occupied the Isthmus, killed the local militia commander and proclaimed the independent state of Panama. The USA then installed a government for Panama and had an agreement, the Hay-Bunau-Varilla Treaty, signed. The signatories were the then US Secretary of State, John Hay, and a former employee of Ferdinand de Lesseps, the French engineer Philippe Bunau-Varilla. This treaty secured the USA sovereign rights over a strip 16 km wide and 80 km long, the later Panama Canal, and the right to military intervention in Panama. The canal was built by the US Army Corps of Engineers between 1904 and 1914; the 83-kilometer-long canal that now exists is considered one of the greatest engineering achievements. On January 5, 1909, the Colombian government under Rafael Reyes signed a contract that would seal the loss of the former province. This contract was not ratified due to strong opposition, both politically and socially. Further negotiations gradually changed the contract and it was finally signed on December 21, 1921, and Panama's independence was formally recognized.

 

Military coups

Between 1903 and 1968, Panama was a constitutional democracy ruled by a commercially oriented oligarchy.

The 1904 constitution provided for universal suffrage for all male Panamanians over the age of 21. Electoral Law No. 98 of July 5, 1941 also gave women over the age of 21 the right to vote and stand for election at the provincial level if they had a university degree, a teaching degree, completed vocational training or attended secondary school. Universal suffrage for all Panamanian women was not introduced until March 1, 1946.

Since the beginning of the 1950s, the Panamanian military began to fight the political hegemony of the oligarchs. In October 1968, President Arnulfo Arias Madrid, who had been elected twice and deposed twice by military means, was deposed again after only ten days in office, this time by the National Guard. A military junta was established and the commander of the National Guard, Brigadier General Omar Torrijos, emerged as the most important power in Panama's political life. Torrijos' regime was considered brutal and corrupt, but he was a charismatic leader whose domestic programs and foreign policy were very popular with the sections of the population, both rural and urban, that were largely ignored by the oligarchy. Above all, he turned Panama into an offshore financial center and a tax haven. In 1970, he radically liberalized the rules for foreign investment. The establishment of banks was made easier, banking supervision by the central bank was abolished and the establishment of numbered accounts was made possible.

After the junta was dissolved, on October 11, 1972, parliament elected Demetrios Lakas as president and Arturo Sucre Perreira as vice president and General Omar Torrijos as the "Great Leader of the Panama Revolution".

At the UN Security Council meeting in Panama from March 15 to 21, 1973, the resolution presented by Panama to transfer sovereign rights over the Canal Zone to Panama was blocked by a veto by the United States. The United States argued that a new treaty was being negotiated and that the UN Security Council could not force a decision because US interests had to be taken into account.

General Torrijos died in an airplane attack on August 1, 1981. The exact circumstances of his death were never clarified. According to John Perkins, the crash was murder by the US secret service.

Torrijos' death changed the tone of Panamanian politics, but not its general direction. Despite the constitutional amendment in 1983 that prohibited the military from playing a political role, the dominance of the Panama Defense Forces (PDF) remained behind a civilian facade. During this period, General Manuel Noriega took control of the armed forces and the civilian government and set up the so-called Batallones de la Dignidad (Battalions of Dignity), paramilitary units designed to suppress opposition.

On September 7, 1977, an agreement was signed for the transfer of the canal, the Canal Zone, and 14 U.S. Army bases within the Canal Zone from the United States to Panama in 1999, on the condition that the United States would have permanent military intervention rights. Some areas of the Canal Zone and increasing amounts of responsibility for the canal were transferred to Panama in the intervening years. Despite the secret alliance between Ronald Reagan and Manuel Noriega during the Contra War in Nicaragua, relations between the United States and Panama deteriorated rapidly in the late 1980s. The US planned to further expand its military presence in Panama and put pressure on Noriega, who resisted, to which the US responded.

In the summer of 1987, the US froze both military and economic aid to Noriega. Noriega was indicted in the US in February 1988 on charges of drug trafficking, money laundering and criminal activities. This further increased tensions. In April 1988, President Reagan placed Panama under the International Emergency Economic Powers Act, freezing the Panamanian regime's accounts in US banks, withholding canal fees, prohibiting US companies and individuals from making payments to the Noriega regime and sending additional military troops to Panama. Noriega was described in the American media as a threat to US national security and newly elected US President George Bush said "we want to get him (Noriega out of Panama)."

In the elections in Panama in May 1989, the USA supported the opposition candidate Guillermo Endara with more than ten million dollars. The military dictator Noriega had the elections declared invalid when it became clear that the coalition supporting him would lose. This was followed by outbreaks of violence in the streets of Panama, in which, among other things, opposition candidates were beaten up by regime thugs in the open street. Both sides accused each other of election fraud. Kurt Muse, an American, was arrested by the Panamanian authorities after he had set up a special transmitter construction with which he intended to disrupt Panamanian radio and telephone election results. The following day, the USA sent several thousand US soldiers to Panama to "protect American lives".

Guillermo Endara was declared the winner of the presidential election by the USA. At the instigation of the USA, a meeting of foreign ministers of the OAS took place, but this ended without result.

 

US military invasion

The US now began to mass large numbers of troops at military bases in the Canal Zone. Panamanian authorities claimed that US troops were leaving their bases and illegally stopping and searching vehicles in Panama. During one such search, a firefight broke out between US Marines and Panamanian soldiers, killing one US Marine. On December 20, 1989, the US launched the invasion. The troops involved in Operation Just Cause achieved their primary objectives in a short time, and the first troop withdrawals took place as early as December 27. The US was obligated by a decades-old treaty to hand over control of the Canal Zone on January 1. On the day of the invasion, Endara was sworn in as president at a US military base.

 

US military presence

In 1911, US troops were stationed in Panama for the first time. Their mission was to protect and accompany the construction of the Panama Canal, which opened in 1914. During the Second World War, up to 65,000 soldiers were stationed at the 14 Panamanian bases in Panama. After the establishment of the American area commands in 1947, the Southern Command was stationed in Panama. In addition to the Panama mission, it also directed American invasions of Grenada and Haiti.

The entire Panama Canal, the area around the canal and the remaining US military bases were transferred to Panama on December 31, 1999. After fighter planes took off and landed at Howard Air Force Base in Panama in June 1997, the US presence amounted to 1,000 men six months before the withdrawal. Despite all his ties to the USA, then President Ernesto Pérez Balladares was relieved about the withdrawal of US troops:

“The U.S. presence in Panama, particularly in the last 20 to 25 years, has had very little to do with the canal[…]and more to do with the security interests in the region.“
– Ernesto Pérez Balladares

in English “The US presence in Panama, particularly in the last 20 to 25 years, has had very little to do with the canal[…]and more to do with the security interests in the region.”

 

Panama after the Noriega regime

On the morning of December 20, 1989, a few hours after the invasion began, the presumed winner of the May 1989 presidential election, Guillermo Endara, was sworn in as President of Panama at a US military base in the Canal Zone. Meanwhile, Panama's Electoral Tribunal declared the annulment of the election by the Noriega regime invalid and confirmed the victory of the opposition candidates led by President Endara and Vice Presidents Guillermo Ford and Ricardo Arias Calderón.

President Endara took office as head of a four-party minority government and promised to promote economic recovery in Panama, to convert the military into a civilian-run police force, and to strengthen democratic institutions. During his five years in office, the Endara government failed to live up to the people's high expectations. His new police force was a tremendous improvement over his predecessor, but was completely unable to effectively combat crime. In 1992, Endara would have received 2.4% of the vote if elected, according to a poll. On September 1, 1994, Ernesto Pérez Balladares was sworn in as president after an internationally observed election.

Pérez Balladares was the candidate of a three-party coalition led by the Democratic Revolutionary Party (PRD), the former political arm of the military dictatorships during the Torrijos and Noriega regimes. A long-time member of the PRD, he worked skillfully during the election campaign to rehabilitate the party's public image by emphasizing the party's origins with the populist Torrijos rather than its connection with Noriega. He won the election with 33% of the vote because the main non-PRD forces could not agree on a common candidate and so competed among themselves. Under his leadership, economic reforms were initiated and he often worked closely with the United States on canal issues.

On May 2, 1999, Mireya Moscoso, the widow of former President Arnulfo Arias, defeated the PRD candidate Martín Torrijos, the son of the former dictator. The elections were described as free and fair. Moscoso took office on September 1, 1999.

During her term, Moscoso strengthened social programs, especially for child and youth welfare and general welfare. Education programs were also given priority. Recently, Moscoso has focused on bilateral and multilateral free trade agreements within the Panamanian territorial environment. Under Moscoso's leadership, the transfer of the canal was also successfully tackled.

Panama's anti-drug policy is very successful compared to earlier times. The Panamanian government has expanded money laundering legislation and concluded several drug control agreements with the United States (such as the Counternarcotics Maritime Agreement and a so-called Stolen Vehicle Agreement). The Moscoso government was also successful in the area of ​​economic investment and strengthened the protection of intellectual property, and also agreed to some agreements with the USA in this area. The Moscoso government was also "strictly in line" with the USA in the fight against terrorism.

In 2004, Martín Torrijos ran again in the presidential elections and won this time, after the people's approval of the Moscoso government had fallen to just 15% following several corruption scandals. He ruled until 2009. After the 2009 elections, businessman Ricardo Martinelli, who was elected with just over 60% of the vote, took over the government. In 2015, he was charged with illegal wiretapping of opposition members. Martinelli was succeeded as President by Juan Carlos Varela. Varela had previously been Vice President and Foreign Minister of Panama under Martinelli, but had already been pressured by Martinelli to resign from the post of Foreign Minister in 2011. In 2016, the country hit the headlines with the publication of the so-called Panama Papers and gained a reputation for promoting international money laundering and tax evasion. Varela was not allowed to run again in the 2019 elections. Laurentino Cortizo won with 33% of the vote, saying that his main goal was to curb corruption.

 

Geography

The state of Panama has an area of ​​75,517 km², of which 210 km² are inland waters. Its coastline is 1,915 km long.

Panama occupies the narrowest part of the Central American land bridge, which is broken here by the Panama Canal. The Isthmus of Panama is only 60 km wide. The highest mountain in the country is the Volcán Barú at 3,477 m. It is part of the Central American Cordillera de Talamanca, which runs parallel to the coasts of Panama.

Panama borders Costa Rica to the west and Colombia to the east, with border lengths of 330 and 225 kilometers respectively.

 

Landscape zones

Caribbean

On the northern, Caribbean coast of Panama, the dry season lasts from January to March/April and a short dry season from the end of July to September. The Bocas del Toro archipelago in the extreme northwest of Panama is home to a national park and, with its white beaches, is one of Panama's most popular tourist destinations. The flora and fauna are increasingly threatened by tourism. The northeastern Caribbean coast is home to the Kuna Yala Indians (also San Blas), who have recognized autonomy within the region.

 

Azuero Peninsula - Chitré area

The Azuero Peninsula is located about halfway between Panama City and David. The entire journey via Chitré and Pedasi is dominated by pastureland, only occasionally interrupted by rice and corn crops. The route gradually turns into the Canajagua mountains, where erosion has left behind strange, cone-shaped hills. In the southwestern part, the driest area of ​​Panama, lies the approximately 8,000 hectare, semi-desert Parque Nacional Sarigua.

 

Darién

The province of Darién is largely characterized by tropical rainforest. The east and south of the province are dangerous for tourists. There are particularly high security risks in the border area with Colombia, as smugglers and drug dealers from Colombia as well as resistance fighters have largely eliminated state order and security here.

 

Climate

The Caribbean coast has annual rainfall of 3000 mm; in Panama City the figure is just under 1800 mm. The rainy season lasts from April to December on the Caribbean side; on the Pacific side from the beginning of September to the end of October. The country is one of the rainiest regions.

 

Flora and fauna

Panama is a natural land bridge and connects North and Central America with South America. Some animal species from both parts can be found here, such as the agoutis, tapirs and harpy eagles. It is estimated that around 300,000 species of insects live in Panama. More than 29% of the land area is divided into 15 nature reserves, which serve to protect and preserve the native flora and fauna.

 

Cities

The most densely populated areas are on the Pacific coast around the Canal Zone. In 2023, 70 percent of Panama's population lived in cities.

 

Culture

National Day is November 3rd, when independence from Colombia is commemorated.

 

Cuisine

Panama's cuisine is a mixture of Spanish and Caribbean, as well as American and German dishes and ingredients. The influence of the indigenous population has also had a significant impact on Panama's pantry. The country's most famous dishes today include sancocho, a stew made from chicken and vegetables, sometimes with bananas, as well as tamales, a type of corn dough with various ingredients such as meat or raisins, and yuca al mojo, cooked cassava pieces with olive oil.

 

Music and dance

Panama's folk customs are shaped by Spanish, African and indigenous influences. They are expressed primarily in music, dance and festivals such as carnival. Historical and modern dances from neighboring Colombia and the Caribbean, together with typical Latin American dances, form a great variety. Well-known dances include the Tamborito, which dates back to the 17th century, and the Cumbia, which comes from the Guinea coast and is in 2/4 and 4/4 time and is also popular in Colombia and El Salvador. Drums and other percussion instruments play an important role in these dances.

Also worth mentioning are:
the Tipico and Vallenato, which have been preserved from the former community of states with Colombia;
the Reggae, Reggaetón (the associated dance is called Perreo, also called Rákata) from Puerto Rico, the Dominican Republic and Panama itself;
dances of the various indigenous groups, including the Kuna Yala;
the Haitano from Haiti;
the typical Latin American dances Salsa, Merengue, Bachata.

One of the most famous salsa musicians in the world comes from Panama: Rubén Blades, who was his country's Minister of Tourism from 2004 to June 2009.

Most of the dances are still mastered by large sections of the population.

 

Literature

Before independence
The first work published in Panama's colonial period is the Llanto de Panama con la muerte de Don Enrique Enriquez (a la muerte?), an anthology on the death of the 17th century governor. The first important author born in Panama was the politician Víctor de la Guardia y Ayala (1772–1824), who wrote neoclassical dramas. Before independence in 1903, a romantic literature developed that reflected the liberal and national currents of the time and especially of Colombia. With the arrival of Modernismo in poetry, the national movement became more radical. One of the first modernists was the diplomat Darío Herrera (1870–1914), a friend of Rubén Darío, who was influenced by Mallarmé. His collection of short stories, Horas lejanas (Distant Hours), was published in the year of independence in 1903.

1903–1950
After separating from Colombia in 1903, Panama shed its Colombian traditions, but was also exposed to high economic and cultural pressure from the USA. Amelia Denis de Icaza (1836–1911) was the first woman to publish her poems (Al Cerro Ancón, 1906), in which she opposed the American occupation of the Canal Zone. Since the 1920s, the aim of authors has been to present an independent cultural identity. This was supported by an educational system that had been relatively well developed since the 1920s and the founding of the University of Panama in 1935.

The most famous author of the 20th century is Ricardo Miró (1883–1940), who was influenced by Modernism and had to give up studying painting in Bogotá for political reasons. After Panama's independence, he wrote the poem Patria (1904), a kind of informal national anthem. For a while he was consul in Barcelona. He also wrote the novels Las noches de Babel (1913), which combines elements of the crime novel and reportage, and Flor de María (1922). The literary prize Concurso Nacional de Literatura Ricardo Miró is named after him.

The modernist lyrical work of Demetrio Kors was also inspired by Rubén Darío; he later returned to regionalism. The nature-loving poetry of the teacher María Olimpia de Obaldía (1891–1985), who campaigned for the women of the indigenous Ngäbe people, cannot be assigned to any school. The poet and storyteller Rogelio Sinán (actually Bernardo Domínguez Alba, 1902–1994) dealt with the European surrealist and other avant-garde movements in Europe. He became known primarily through short stories, but his work Onda (1909) in particular marks the beginning of the avant-garde in Panama. In the 1930s and 1940s he contributed to the development of theater and especially children's theater in Panama.

1950–2000
Panama produced numerous other writers in the second half of the 20th century, although their works have generally not yet been translated into German. They were influenced by Colombian, Nicaraguan and Guatemalan authors, among others. Nevertheless, local themes such as the canal and life in the countryside remained important.

The works of the literary scholar, essayist and storyteller Gloria Guardia (* 1940), born in Venezuela to Panamanian-Nicaraguan parents and living for a time in Colombia, have received international recognition. Her work is characterized by the elimination of boundaries between genres and a postmodern collage technique. Her works have also been published in the USA, France, England, Italy, Poland and Japan. Other well-known authors include Joaquín Beleño (1922–1988), whose experiences with the US administration of the Canal Zone were reflected in dark novels such as Luna Verde (1951), the realistic narrator and poet Tristán Solarte (* 1924), who almost fell victim to an assassination attempt by paramilitaries in 1984, the versatile author and doctor Rosa María Britton (1936–2019) and the narrator, poet and essayist Enrique Jaramillo Levi (* 1944), who has written or edited more than 50 books. The poet, essayist and sculptor Giovanna Benedetti (* 1949) now lives in Spain. Her works have been translated into several languages.

The co-founder of the Mossack Fonseca law firm, a key player in the Panama Papers scandal (1952–2024) and author of legal textbooks, was also an award-winning novelist. His political thriller La danza de las mariposas (1994; German: The Dance of the Butterflies, 2000) is set in a fictional Central American country in which the military controls society with the help of an esoteric circle.

Present
The range of topics covered by authors of the younger generation has expanded considerably; they write about urban chaos or fantastical topics. The storyteller Carlos Oriel Wynter Melo (* 1971) is considered a promising talent. The ancestors of the poet, storyteller, violinist and music therapist Melanie Taylor (* 1972) come from the Caribbean. She is inspired by the poetry of Guatemala and also writes micro-stories (Minificción). She reflects on the gentrification of Panama City, ghetto aesthetics and the androgynous body cult of young people, which she sees as a revolt against the McDonald's world. The poets and authors of stories and micro-stories Lucy Cristina Chau (* 1971) and Lili Mendoza (* 1974), who also write literary reports (Crónicas), are well known throughout Central America. Ariel Barría Alvarado has received several awards for his novels and short stories.

Electronic mini-texts, photo essays and short stories are written by the engineer, computer scientist and cultural manager José Luis Rodríguez Pittí (* 1971), who publishes the blog minitextos.org. This has greatly increased the media reach of the small country's authors. The website escritorespanama.com provides information on current literary events.

Panama has a poorly developed book market and imports many books from Colombia, Mexico and Spain. Literary prizes are awarded by the Instituto Nacional de Cultura, the Technical University of Panama (UTP) and the Fundación Cultural Signos, among others. The Concurso Nacional de Literatura Ricardo Miró is Panama's most important literary competition and prize, held since 1942.

 

Painting

The most famous Panamanian painters are Hernando de la Cruz (1592–1646), a Counter-Reformation artist who decorated various buildings in Quito (Ecuador), Adriano Herrerabarría (* 1928) and Rodolfo Antonio Méndez Vargas (1926–2004), who was influenced by realistic and impressionist paintings.

Films related to Panama
The Panama Deception
The Tailor of Panama (film)
Charlie Chan in Panama

 

Media

The Panamanian government strictly controls access to official information and puts pressure on the media, among other things, through the selective awarding of state advertising. The non-governmental organization Reporters Without Borders sees noticeable problems for press freedom in Panama. Government employees face severe penalties if they secretly release relevant information to the public. Journalists are often sued for criticizing the government or reporting on corruption cases, especially when they have an international dimension, such as the Panama Papers cases. Libel lawsuits are common and usually result in fines.

Linear radio and television are the main information media in Panama. The most widely circulated newspapers are La Prensa, Panama America, Critica and El Siglo, all of which are published in Panama City.

 

Sports

Among the most popular sports in Panama are baseball and soccer. The national soccer team's greatest success was second place in the 2013 and 2005 CONCACAF Gold Cup and qualifying for the 2018 FIFA World Cup in Russia, where they were eliminated in the preliminary round but managed to score two goals as debutants. Panama did not participate in the Olympic Games in 1932, 1936 and 1956. The country followed the USA's call for a boycott and also stayed away from the Moscow Games in 1980.

Special Olympics Panama has participated in the Special Olympics World Games several times.

 

Population

The inhabitants (Panamaese) are called Panameños in Spanish and Panamanians in English.

 

Demographics

Panama had 4.5 million inhabitants in 2023. Annual population growth was + 1.3%. A surplus of births contributed to population growth (birth rate: 17.4 per 1000 inhabitants vs. death rate: 5.9 per 1000 inhabitants). The number of births per woman was statistically 2.3 in 2022, compared to 1.8 in the Latin America and Caribbean region. The life expectancy of Panama's inhabitants from birth was 76.8 years in 2022. The median age of the population in 2021 was 28.8 years. In 2023, 25.8 percent of the population was under 15 years old, while the proportion of people over 64 was 9.0 percent of the population.

 

Population structure and languages

Almost two thirds (around 60%) of Panamanians have both indigenous and European ancestors. They live mainly in the western provinces of Coclé, Herrera and Veraguas, where they make up up to 90% of the population.

The second largest group are the blacks or Afro-Panamanians, who make up around 15% of the total population (50% in the provinces of Darién and Bocas del Toro). They can be divided into two groups, each of which makes up half of all Afro-Panamanians. The members of the first group are descended from slaves abducted from West Africa by the Spanish and therefore speak Spanish. The others are descended from immigrants from the Caribbean states and speak a creole English interspersed with West African and French elements. The word for corn flour kukúu comes from the Ewe language, and for food yampí from the Wolof language.

The Afro-Panamanians are followed by the descendants of European settlers and immigrants with 13% (in the provinces of Panamá, Los Santos and Chiriquí over 15%). People of Asian descent make up around 4% of the population.

The indigenous people make up 8.3% of the population (according to other figures in 2010: 12%). The largest groups are Guaymí (Ngäbe and Buglé) and Cuna. Other tribes are Embera, Wounaan, Bribri and Naso. The Embera and Wounaan live in the autonomous comarca Emberá-Wounaan and on the Rio Chagres. In the 1950s, small groups of Embera from the Panamanian province of Darien settled on Lake Alajuela because they feared Colombian arms and drug traffickers and coca cultivation. They saw tourism, which was very limited in number, as an opportunity to both ensure their survival and preserve their culture.

A genetic study in 2002 found that the average Panamanian population had 39% African, 36% Indian and 25% European genetic makeup.

In 2017, 4.7% of the population was born abroad. Most foreigners came from Colombia (60,000), China (20,000), the USA, Nicaragua and Venezuela (10,000 each). The migrants mostly settled in Panama for economic reasons.

 

Religion

The population of Panama is predominantly Christian; 86% (according to other sources 75 to 80%) are Catholics and 10% (according to other sources 15 to 25%) are Protestants (mostly evangelicals). There are about 1% Jews and Muslims each. Among the Ngäbe (Ngöbe) there are many followers of the Baha'i religion. Mormons are also well represented. Some groups of the indigenous Kuna, Ngäbe, Buglé and Embera are still followers of their traditional Mesoamerican religions.

 

Health

The country's health expenditure in 2021 amounted to 9.7% of gross domestic product. In 2019, there were 16.4 doctors per 10,000 inhabitants practicing in Panama. The mortality rate among children under 5 was 13.3 per 1,000 live births in 2022. The life expectancy of Panama's inhabitants from birth was 76.8 years in 2022 (women: 80.1, men: 73.7). Life expectancy increased by 4% from 74 years in 2000 to 2022.

 

Economy

In the Global Competitiveness Index, which measures a country's competitiveness, Panama ranks 50th out of 137 countries (as of 2017-2018). In addition, Panama has the most globalized economy in the entire region. One main reason for this is the country's hub function thanks to the Panama Canal, which was expanded in 2016 to accommodate larger ships, and an associated network of leading, ultra-modern and efficient ports in the region - both on the Atlantic and the Pacific - as well as numerous free trade and special economic zones that are of supra-regional importance. Panama's GDP per capita was 23,034 US dollars (PPP) in 2016, which puts the level of prosperity roughly on a par with Croatia. This makes the country one of the richest in Latin America. Thanks to increasing trade, the economy has expanded by 5 to 6 percent annually in recent years.

The most important source of income for the Panamanian economy is the Panama Canal, which employs around 8,000 people to manage, operate and maintain. The canal authority "Autoridad del Canal de Panamá" (ACP) achieved a surplus of 3.2 billion dollars in 2023. The registration of ships is also an important economic factor. The most ships in the world are registered in Panama, almost one in five. The reason for this is the comparatively uncomplicated procedure and the low taxes.

Panama's largest source of income is related to the operation of the Panama Canal, which was jointly administered by Panama and the United States for a long time and has been under Panama's sole control since December 31, 1999. The gross domestic product (GDP) is 61,838 million US dollars (2017; services: 82 percent, industry: 15.7 percent, agriculture: 2.4 percent); this results in a GDP per capita of 15,089 US dollars.

The total number of Panamanian workers who have regular paid work is less than a third of the total population. The rest work for their own needs, live off of illegal work or are unemployed (2005: 9.6 percent). 19 percent of the regularly employed work in agriculture, forestry and fishing, 62 percent are employed in trade, finance and services, and 19 percent in industry. Almost 17 percent of all wage workers are unionized.

On January 28, 2016, the EU Commission presented a package of measures to combat tax evasion, which included Panama on the black list of tax havens. After the Panama Papers revelations, President Varela promised more tax transparency and openness.

 

Agriculture

8.8 percent of Panama's land area is used for agriculture. The main crops grown are bananas, plantains, sugar cane, rice, pineapples, corn and coffee. The livestock includes cattle, pigs and chickens.

 

Forestry and fishing

Forests cover around 45 percent of the country's surface area. A national forestry authority manages most of the forest areas - around two thirds are protected, the remaining third is used as commercial forest.

Fishing is an important economic sector. The most important catches include shrimp and crabs.

 

Mining and industry

Small amounts of gold and silver are mined in Panama. Salt is extracted on the Pacific coast. Most of the products of the manufacturing industry such as cement, cigarettes, shoes, clothing, soap, processed foods and alcoholic beverages are intended for the domestic market. Oil refineries produce mainly for export.

 

Financial industry

Panama has had one of the largest banking systems in Latin America since the 1980s and has therefore attracted wealthy Germans. Offshore deals in particular are offered on a large scale, including by major law firms such as Mossack Fonseca, which became known through the Panama Papers.

 

Currency and foreign trade

Panama's currency unit is the Balboa (PAB), with 1 PAB divided into 100 centésimos. The US dollar is also the official means of payment. The Balboa is pegged 1:1 to the US dollar. In addition to US cent coins, Balboa coins are also in circulation. Over 1 PAB/USD, only US dollar bills are used for payment. The National Bank of Panama is the state bank founded in 1904.

The country's most important export goods are bananas, pineapples, petroleum products, shrimp, raw sugar and coffee. Over 60 percent of these go to the United States. Imports come mainly from the United States and China. Panama's other main suppliers are Mexico and Japan. Imports primarily include fossil fuels, textiles, canned goods, machinery, chemicals, mining equipment and raw materials. The trade balance is negative.

 

State budget

In 2016, the national budget included expenditures of the equivalent of 12.4 billion US dollars, compared to revenues of the equivalent of 11.7 billion US dollars. This results in a budget deficit of 1.2% of GDP.
The national debt in 2016 was 39.7% of GDP. Panama's government bonds are rated BBB by the rating agency Standard & Poor's (as of December 2018) and are therefore considered investment-worthy.

In 2020, the share of government spending (in % of GDP) was in the following areas:
Health: 9.7%
Education: 3.9%
Military: 1.1% (2023)

 

Infrastructure

Energy

In 2005, 5.8 terawatt hours of electrical energy were generated, 36 percent of which came from thermal power plants and the rest almost exclusively from hydroelectric plants.

 

Telecommunications

In 2022, 73.6 percent of Panama's inhabitants used the Internet.

 

Transport

In the Logistics Performance Index, which is compiled by the World Bank and measures the quality of infrastructure, Panama ranked 38th out of 160 countries in 2018. Of all countries in Latin America, Panama ranks second behind Chile.

The north-south connection between the Atlantic and Panama City on the Pacific is known as the Transistmica. Today, the railway line (recently renovated) runs next to the Panama Canal, as does a road connection between Panama City and Colón some distance away. Many accidents happen on it (due to heavy traffic and poor condition). From 2007 to 2009, a 42 km long new highway was built parallel to the Transistmica by the Brazilian Odebrecht Group to shorten the journey between Colón and Panama City and make it safer.

 

Road

Panama's road network is 11,400 kilometers long, including a section of the Pan-American Highway. The main connecting road is the Pan-American Highway, which runs through the whole of Panama. The Pan-American Highway actually connects North America with South America and runs from Alaska to southern Chile, but there is a gap in the border area between Panama and Colombia, the so-called Darien Gap. This jungle area is criss-crossed by swamps, so the cost of building a road would be very high. Environmentalists and the indigenous population are also protesting against closing the gap in the Pan-American Highway.

 

Railroad

The country once had around 450 kilometers of rail, of which around 380 km were narrow-gauge railways; the last were dismantled in 2008/2009. The approximately 75 km long main line of the Panama Canal Railway runs across the Isthmus of Panama and connects the city of Colón on the Caribbean with Panama City on the Pacific, essentially along the canal. The Panama Railroad was built between 1850 and 1855 and had a gauge of 1524 mm; a route was rerouted between 1904 and 1912. It was privatized in the 1990s and taken over by Kansas Southern Industries from the USA, modernized and converted to the 1435 mm wide standard gauge in 2001. Freight traffic takes place, and since 2001 also with double-deck container wagons; in addition, a passenger train runs in each direction on weekdays and charter trains are operated for cruise ship passengers.

 

Shipping

The Panama Canal connects the Caribbean Sea with the Pacific Ocean. The largest ports in the country are Balboa, Cristóbal, Bocas del Toro, Almirante and Puerto Armuelles. Panama's merchant fleet is currently the largest in the world with 6,184 ships, but this is due to the practice of flagging out: almost all ships registered here are foreign-owned and manned by foreign crews.

On October 22, 2006, a referendum was held to expand the Panama Canal. 78% voted in favor of the expansion (with a voter turnout of 44%). The canal, one of the country's main sources of income, had reached its capacity limit of 14,000 ships per year. The newly expanded canal was officially opened on June 26, 2016.

 

Air traffic

The international airport Aeropuerto Internacional de Tocumen (PTY) is located near the city of Panama, near Tocumen. In addition, the Marco A. Gelabert regional airport is located in the former canal zone, very close to the central bus terminal. From there you can reach provincial capitals such as David (Chiriqui) or Changinola and Isla Colon (Bocas del Toro). The domestic airlines are Aeroperlas Regional (part of Grupo TACA) and the private Air Panama. The airline Aeroperlas Regional filed for bankruptcy at the end of February 2012 and has since completely stopped regional air traffic.