Panama Relocation Newsletter

From the Proctor & Gamble Press Release on June 1, 2021:

A WORLD TRADE CENTER AT THE CENTER OF THE WORLD

The Costa del Este neighborhood of Panama City.

“In Panama, we have found a business-friendly environment with an open-door policy,” says Juan Fernando Posada, P&G’s president for Latin America.

The Central American nation is best known for its eponymous canal, a majestic symbol of global trade, through which flows 5% of all the world’s goods.

But Panama is much more than just a place to pass through, its central location, modern trade infrastructure and economic and political stability have combined to createa strong draw for foreign businesses seeking to build regional trade operations or manufacturing hubs.

In 2007, Panama’s legislature passed a package of corporate tax, labor and immigrationbenefits that have led 175 multinationals to establish regional headquarters in Panama, accounting for $1.2 billion in investment. In a sequel of sorts, in February, Panama enacted a second set of rules that extended those benefits from headquarters operations to manufacturing facilities.

Companies Participating in the Multinational Headquarters Regime (SEM) 175 total!!!

“There are definitely very clear factors making Panama a good decision to strategically locate our Latin America HQ,” says Posada.“

The economic and political stability that the country enjoys, security, financial services and definitely the easy air interconnection with the rest of the region.”

Said Juan Fernando Posada, President P&G Latin America.

Procter & Gamble the first multinational firm to move its Latin America headquarters to Panama under the 2007 Multinational Headquarters regime (known locally as the SEM regime, per its acronym in Spanish).

Multinationals locating regional headquarters in Panama pay reduced income taxes for services rendered, and zero dividend taxes.

“It makes it easier for multinationalcompanies to bring their executives and trusted personnel to Panama,” says Ramon Martinez dela Guardia, Panama’s Minister of Commerce and Industries.

For P&G, relocating 500 families to Panama from several Latin American countries “wasa big challenge, but we got a lot of support to make it as smooth as possible,” says Procter & Gamble Senior Vice President Carlos Giraldo.

From ANPanama News on June 2, 2021:

ACOBIR AND ADI LATAM SEAL ALLIANCE TO BOOST REAL ESTATE SECTOR

(Panama City-ANPanamá) The Panamanian Association of Real Estate Brokers and Developers (ACOBIR), signed a strategic alliance with the Association of Real Estate Developers of Latin America (ADI LATAM) to promote business opportunities in the sector.

ADI LATAM was born from the alliance of associations of real estate developers from Peru, Chile, Guatemala, and Colombia in 2018, to promote the development of the sector in the region. Currently, ADI LATAM is made up of the countries of Argentina, Peru, Guatemala, Chile, Costa Rica, Mexico, Uruguay, Ecuador, Nicaragua, and Panama.

A statement from the guild indicates that "ACOBIR maintains the firm commitment to contribute to the sustainable and orderly real estate development of Panama, in addition to coordinating with various partners at the national and international level for the development of actions that strengthen access to housing and boost the real estate sector." He adds that from this new alliance, it is expected for our country and the professionals of the guild, greater possibilities to deepen knowledge, strengthen ties of cooperation, exchange of business delegations, and relationship with the real estate industry at the level of Latin America.

Francisco Cheng, President of ACOBIR said that "this alliance aims at the union of the entire region and puts us a huge path of opportunities and development ahead, which we bet on a clear strategic line of continuing to develop business and position Panama as the Real Estate Hub of the Americas".

From now on, the leading guild of the real estate sector of Panama will be hand in hand with one of the most important international spaces of cooperation for the sector, through which a broad overview of the exchange of experiences of what our peers do in the region will be provided.

Thinking about Buying Property in Panama?
Contact the Keller Williams Panama - KW Obarrio Real Estate office Panama City.

E-Mail: kwobarrio@kwpanama.com
Telephone: + (507) 368-0700

The address is building PH SL55, Floor 31, Samuel Lewis Avenue & 55th Street, Obarrio, Panama City, Panama.

From ANPanama News on June 3, 2021:

PANAMA PUTS INTO EFFECT USE OF ELECTRONIC INVOICING

(Panama City-ANPanamá)

Panama put into effect the use of electronic invoicing for all merchants, entrepreneurs, and professionals to improve their collections and facilitate transactions.

The General Directorate of Revenue (DGI) of the Ministry of Economy and Finance (MEF), as of June 1 of this year, began the program of voluntary massification of electronic invoicing in the country, through the use of the free biller, as well as the mandatory introduction of the transmission device for tax machines aimed at entrepreneurs, merchants, and professionals who wish to remain using this billing system.
Both the electronic invoice and the transmission mechanism for the fiscal machines will allow greater control and traceability, which will help meet the collection goals in these times of difficulties caused mainly by the effects of Covid-19 on the Panamanian economy, indicates a report of the institution.

All users of the tax teams that decide to remain with this system will have to implement a series of adjustments aimed at the main objective: the transmission of data to the tax administration, which will allow improving the efficiency in the use of information, as well as the collection and control of taxes by the collecting entity, indicates the DGI.

The DGI stipulated for the acquisition and implementation of these equipment’s a tax credit for up to 400 balboas, which will help alleviate the cost of acquiring the communication device or data transmission component, as the case may be.

On the other hand, the DGI since last May 19 enabled all taxpayers who voluntarily wish to migrate to the electronic invoice the application for online adoption from the e-Tax 2.0 system for the proper registration and authorization of this billing alternative.

It is important to bear in mind that for the electronic invoice two alternatives are handled: the first, that the DGI makes available to taxpayers, a free biller of the electronic invoice system (SFEP), whose objective is focused on those entrepreneurs or companies that have an income of up to 1 million balboas and a low volume of billing, of about 200 monthly bills.

To acquire this type of billing, the taxpayer must complete their due registration and authorization and then enter the website of the institution (in electronic invoice button).

Second, for those companies that manage integrations at the level of their accounting systems, they may choose to use qualified authorization providers (PACs), strategic allies for the taxpayer and the DGI, to facilitate the use of electronic invoicing. For the use of this alternative, the user must complete their due registration and once they receive their authorization, it will have deadlines to make the adjustments to their systems.

(Panama City-ANPanamá)

The economic reactivation of Panama became a trigger for the consumer confidence index to present a slight improvement, reported the Chamber of Commerce, Industries and Agriculture of Panama, which in strategic alliance with The Marketing Group, presented the results for May 2021.

In May the index scored 105 points, 5 points above the March 2021 measurement. The General Manager of The Marketing Group, Domingo Barrios, commented that "There is a slight increase in the level of consumer confidence in the face of the economic recovery."

Jose Ramón Icaza Clément, President of CCIAP, commented: "Employment and vaccination are essential factors to increase consumer confidence, and thus maintain the dynamism of the economy."

Expectations about the probability of saving money increase by 18 percentage points, presenting a result of 93 points, still below the breakeven point, so it remains at levels of distrust.

The perception of unemployment marks an index of 103 percentage points, up 7 points when compared to the March 2021 measurement. This indicator shows an increase in confidence levels, presenting a significant improvement in the face of the announcements of the reactivation of contracts. 45% of the interviewees are optimistic about the situation of their jobs in 6 months, 33% believe that it is unlikely that they will have a job in 6 months, 8% think they will not have a job and 14% do not know what will happen. So, as uncertainty decreases, this indicator would perform better.

Consumers' expectations about the economic situation of their households are maintained with a slight increase in confidence, going from 116 percentage points in March 2021 to 117 points in May 2021. This result indicates that consumers have favorable perspectives on the situation of their homes in the future.

From Panama’s daily newspaper La Estrella de Panama on June 2, 2021:

PANAMA’S HOTELS TO IMPLEMENT USE OF SOLAR THERMAL ENERGY

Panama will install one million square meters of solar thermal technology in its hotels by 2050, to reduce Carbon Dioxide (C02) emissions into the atmosphere, it was revealed on Friday.

According to the Panamanian Association of Hotels (APATEL), the initiative is part of the project carried out by Termosolar Panama through an inter-institutional alliance between the UN Environment regional office for Latin America and the Caribbean and the National Secretariat of Energy, as part of the climate commitment acquired by the country in the Paris Agreement.

For that purpose, these facilities will install solar water heaters, which will allow Panama to reduce 6.4 million tons of CO2 and save more than three million dollars annually in fossil fuels.

‘The importance of implementing this project stems from the fact that it saves significant amounts of energy per year, which means to mitigate costs for owners and fewer emissions from the traditional hydrocarbon-based electricity grid,’ said APATEL president Armando Rodriguez.

In statements to the newspaper La Estrella de Panama, Rodriguez explained that this solar water heating technology will also facilitate the creation of new jobs related to the installation and maintenance of equipment.

From ANPanama News on June 4, 2021:

BREWERY BETS ON RENEWABLE ENERGY AND OPENS ITS FIRST SOLAR FARM

(Panama City-ANPanamá)

The Cervecería Nacional inaugurated its first large solar site to reduce CO2 emissions and as part of a sustainable development plan that includes for this year other solar farms in Veraguas, Herrera, and Panama Oeste.

Together with Celsia, an energy company of Grupo Argos, Cervecería Nacional inaugurated and put into operation a solar farm with an estimated production of 154,791 kWh per year, making the distribution center of the Province of Colón, the first center of the National Brewery that works with photovoltaic solar energy.

The objective is to reduce CO2 emissions in the atmosphere, so energy efficiency has become one of the main ways to take care of the planet, by reducing energy intensity and habituating the user to consume what is necessary, says a company report.

The installation of 450 solar panels, a farm on the floor, will represent a significant contribution to the preservation of the environment, since this brewery center will stop emitting 54 tons of CO2 per year, equivalent to planting 3,023 mature trees per year, achieving the reduction of greenhouse gases.

"Solar energy undoubtedly represents a factor of positive change for those who adopt this source of clean energy, also contributing to meet the objectives related to the mitigation of climate change in our environment" highlighted the President of Cervecería Nacional, Danilo Pires, and added that "Now with the installation of these solar panels, we are significantly advanced in the objective of our Climate Action axis, which seeks to make 100% of the electricity purchased come from renewable sources, as well as reduce by 25% the emissions of the carbon footprint in our value chain".

"With this inauguration in Colón of the first distribution center with solar energy, we are starting with this ambitious project for the benefit of the environment, and this year we will also be inaugurating other solar farms in La Chorrera, in Chitré and our Distribution Center in Santiago de Veraguas. This is how we built a company that lasts for 100 more years in the hearts of Panamanians, "said Danilo Pires.

"Celsia's vision is to continue being the strategic ally that supports and advises customers who are valuing and giving greater importance in their businesses to the use of renewable energies, such as solar, and in this way actively contribute to the care of the environment. Currently, in Central America, we have approximately 400 customers with solar energy contracts and that is in the process of production and installation, and that corresponds to the industrial, commercial, and residential sectors, "said Javier Gutiérrez, Celsia Leader for Central America.

From the POLS Attorneys Blog on June 1, 2021:

PANAMA IS ONE OF THE BEST COUNTRIES FOR EXPATS: HERE’S WHY!

It’s no mystery that after 2020, more people than ever are looking to find the best countries for expats so they can relocate.

Long before 2020, this was the case too. The reality of our ever-globalized world is that people go where they feel they’ll be treated best.

People vote with their feet. People want an adventure, and relocating to a new country can provide some of the best adventures, and incentives around.

When looking for the best countries for expats, there’s no universal answer or fit. There are, however, several important factors that people weigh while making this big decision. Of these factors, the most common are cost of living, ease of travel, safety, tax responsibility, weather, and quality of life. Panama, as a target location for expatriation, excels in all of these categories, and then some. Here’s why.

Panama has a long history of both economic and political stability

There have been some dark times, let’s be clear. Certainly, the Noriega era was a black eye on Panama’s political and social history. That period, however, is long gone, and it lasted for a very short time respectively. Conversely, for over 100 years now, Panama has had an incredibly stable and reliable financial foundation and political foundation. It has the backing of the United States in nearly every aspect. It uses the US dollar as currency. There is no threat of revolution, hyperinflation, or elevated crime like in some of Panama’s neighboring countries, and it has a stable and friendly investment climate. Panama has long been a safe haven for assets, as well as for people looking to live a comfortable life without the same level of socioeconomic volatility that is so prevalent in the region.

Part of what makes Panama so appealing as one of the best countries for expats in this stability. Expats from all over the world can rely on Panama’s banks not to default and have many legal protections for their financial, business, and real estate assets. Inflation in Panama is parallel to the US, thanks to the dollar, so although it can fluctuate, it won’t fluctuate any more radically than it would in North America.

Panama has some of the world’s best nature, and it’s all reachable within hours on the isthmus

The best countries for expats usually offer more than just financial and political benefits. One of the most desired benefits for those looking to expatriate is access to nature.

Panama’s access to incredible, unspoiled nature is almost unprecedented for a country of its size. There are thousands of acres of tropical jungle, national parks, hundreds of islands, beautiful mountains, and rivers that are ideal for swimming, fishing, and exploring. Panama City has the world’s only rainforest within the actual city limits of a capital, and you can climb to the top of Ancon Hill to explore it and see the entire city from a unique vantage point. The easy access to nature from the capital city is another huge draw for those who like a good work/life balance and must live in the city for work.

If being in the city isn’t a requirement for you, you can live right in the thick of Panama’s biodiverse countryside and still experience the creature comforts of a modern lifestyle. In towns like Coronado, San Carlos, and Gorgona, you can live right on the beach, walking distance from the sand, away from the crowds. All this can be had from the comfort of a condo building with amenities, or a single-family home or villa.

If mountainous nature is more of your thing, check out Boquete, Volcan, or El Valle, where a different type of nature as right at your fingertips, and the weather is cool and dryer. If islands are your thing, Panama has hundreds, with places like the Pearl Islands being popular for a luxury lifestyle, and Bocas del Toro for the more bohemian, classic Caribbean vibe.

All of these choices, and many more, are part of what makes Panama one of the best countries for expats, and most nature-lovers would agree.

Great value when it comes to cost-of-living expenses

There are lots of reasons why value is a leading measurement of the best countries for expats, and Panama offers tremendous value to expats with all types of budgets. It is certainly not the cheapest country in Central America, South America, or the Caribbean.

However, when you look at the value of what you get for your money across the luxury, low-cost, and mid-cost sectors, Panama has a lot going for it in this area.

You can rent a very nice apartment in Panama City (1-2 bedrooms with a view) for under $1,000 per month in most cases. For luxury condos, that price goes up about 40-50%, however, they are still great deals when you look at all of the amenities and services many of them offer. Outside of the city, rents are even lower, with large single-family homes in many expat communities going for around $1,000 as well.

Food is fresh, natural, and cheap in Panama if you eat locally-sourced food or at restaurants that focus on locally-sourced ingredients. Eating out can also be an incredibly rewarding experience, and freshly prepared food abounds in all parts of the country. As far as dining out prices, it can run the gamut from very cheap to very expensive, and everything in between. It all depends on where you go, what you’re eating, and what the occasion is.

In general, however, you will find that most restaurants and bars in Panama City have mid-level US/Canadian pricing, for top-quality food. Dinner for two, including two drinks, will run about $50-$60 in a decent restaurant, with maybe double that price in a fancier one, and half that price in more of a casual type establishment.

Paying for services is very affordable in Panama, and offers tremendous value for those looking to relocate to one of the best countries for expats. Domestic help costs about $5 per hour, and transportation services cost between $3-$6 for short rides in most towns and cities, including the capital. Electricity, cable, and internet bills should be on par with prices in the US and Canada, with phone bills significantly lower. Many expats use a lot of electricity due to the heat and their energy consumption habits, but for those who don’t need A/C all the time, they can save a lot of money over time in this area.

Panama is easy to get to from nearly everywhere in North America

One of the big reasons Panama is considered one of the best countries for expats is how well located it is geographically.

It is incredibly easy to get to via direct flights from about 20 North American cities. For example, Panama is just a 3-hour flight from Miami, a 5-hour flight from New York, and a 7-hour flight from Los Angeles. It’s also just a few hours from Houston, Atlanta, Orlando, and New Orleans!

People who relocate to Panama often enjoy traveling to see family up north, or other parts of Latin America and the Caribbean. It is just as easy to fly south to big cities like Bogota, Lima, Medellin, Rio de Janeiro, or Buenos Aires too. Whether it’s a weekend getaway or a scheduled trip to see friends and family, expats will not have a hard time getting where they need to go in a short period.

Favorable tax structure and tax incentives for expats

Beyond all of the quality of life and cost of living incentives Panama offers expats, it also offers one of the most favorable tax structures to foreigners on earth.

Panama taxes are extremely low for both foreign corporations or individuals. There are also tremendous tax benefits while buying real estate that can grant foreign buyers 20-year forgiveness on taxes to their property. Even as a small investor or a family that simply wants to relocate, you’ll find that there are many ways to lower your overall tax burden significantly in Panama.

When applying for your residency visa, a good lawyer can help show you which visas offer the best tax options for you, and which you qualify for. Over time, Panama’s tax incentives can save life-changing money for expats, particularly ones with a previously high domestic tax burden.

Regardless of what your reasons are, Panama remains one of the best countries for expats on earth. There’s no right or wrong reason to relocate to Panama, too, even if just for a few years. Life in Panama can be an adventure and a unique experience that you can take with you for the rest of your life. To get the ball rolling on learning how to do it for yourself, and how to do it right, feel free to contact our team to discuss further. We have experienced immigration lawyers and real estate professionals who can help you navigate each step needed to take along the way.

Want to Relocate to Panama?

Panama offers several immigration visas including retirees, investors, and citizens in 50 “Friendly Nations”.

For more information, Feel free to visit our website at www.pols.com.pa or contact us directly at info@pols.com.pa or call or WhatsApp + (507) 6605-0867.

From the Panama Perspective on June 18, 2021:

BIRDING IN PANAMA WELL WORTH THE FLIGHT

The area of Central America is well-renowned among the set of dedicated, almost obsessive, hobbyists called birders. With more species of birds and trees than any other area of the world, Central America is the destination among destinations for those seeking to locate the elusive as well as the resplendent nature travel experience.

Before advocating in favor of Panama as the choice for a birdwatching-focused journey, it is important to understand the true nature of the birder. In his book, The Verb ‘To Bird,’ Peter Cashwell wrote, “In truth, my mind is less distracted by birding than inordinately pleased by it, probably because birding is as much an intellectual passion as an emotional one.” There is a scholarly birding experience, sort of ornithological, that happens in the process of analysis and identification. The more cerebral birder will also understand that there is an emotional, vis-a-vis spiritual experience at play here, as the species appear to us, elude us, carry folklore and history, and even possess a deified presence.

Panama is rich with birdwatching opportunities. Contadora Island, the fifth largest of the Pearl Islands, is located in the Pacific Ocean about 50 miles from Panama City. The island has enough features for a dedicated stay, with fine hotels, restaurants, a dive shop, and water activities such as diving, snorkeling, and sports fishing. The 13 beaches which encircle Contadora Island are among the most serene in the world.

From here, birders can share the shoreline with birds such as the yellow-crowned night heron, snowy egret, and the brown pelican, who can be seen floating by with its pterodactyl resemblance.

Another island excellent for exploration is Taboga Island. Travelers can make this a day trip or even stay over a few days. Taboga Island is a short boat ride from Panama City to Panama Bay. Taboga Island is ideal for beachcombing or hikes that take the adventurer up to the top of Cerro de la Cruz for a panoramic view of the island, well worth the three-hour trek. On the island, the birder can check off his/her list when identifying cormorants, boobies, and frigate birds. A closer inspection and birdwatchers might catch a glimpse of a blue-chested hummingbird, black striped woodpecker, or a grey-capped flycatcher.

At the Finca El Oasis Hotel in Volcan Baru, Boquete, Panama, not only can the traveler see a wealth of birds, but also feel like a bird him/herself. The zipline experience is one of the hotel’s many activities. From atop the canape, one can see how birds have so easily been seen as spiritual totems.

The elevation, and the fact that Finca El Oasis is the only farm located inside a national park and volcano, enables the birder a unique experience. At 2400 meters above sea level, the hotel vantage point allows for a great view of the harpy eagle, the national bird of Panama, as well as the resplendent quetzal, which is most likely to be seen in Boquete.

Though a few spots in Panama were outlined, the entire region is rich with birds.

Also, there are more bird species in this region of the world than anywhere else on earth.

Thus, this is a birder’s paradise where the trained eye can spot a tropical kingbird, a sun bittern, a bare-necked umbrellabird, a rosy thrush tanager, a speckled owl, and hundreds more. A quality pair of binoculars, bug spray, long pants, and a hat is all one needs to take the trek of a lifetime: birdwatching in Panama.

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Until next time, thank you for reading “Panama Relocation Newsletter”.

For your Panama relocation services, immigration, real estate, and a corporate law primarily for local Panama businesses needs contact:

Fax (Panama): ++ (507) 227 - 7485
Note: If calling to Panama from the US or Canada,
you must dial "011" prior to the country code (507).