In the business world, Panama is very well known for a few things: shipping, banking, tourism, and real estate. But these days, it’s the tech industry that’s catching the attention of many investors and entrepreneurs. Businesses can operate with low overhead, access to high-speed Internet, and a booming consumer market that loves electronics. Over the past few years the city, and country, have developed a tech-friendly culture that shows signs of becoming a big contributor to the local economy, and regional industry. Here’s why.
It’s All About the Apps
Smartphone usage in Panama has had consistent, steady growth, since Google’s Android OS broke into the Latin American market. Smartphones can be purchased for as low as $30, and data is cheap. Much like in the US, cellphone carriers have picked up on this, and incentivized data-driven plans that are cheap, and relatively good service, although far from what they would be in North America. Because of this, the culture of online communication, shopping, and task management has flourished in Panama.
WhatsApp, the cross-platform mobile messaging app has essentially replaced SMS texting, and even calling, and is used by nearly everyone with a smartphone, including many businesses. Other apps such as Waze, Uber, Tinder, and social media mediums like Facebook and Instagram are also immensely popular, and woven in to Panama’s younger, more modern culture. And much like in other parts of the world, the market’s desire for, new, bigger, better, and more efficient apps and web tools has grown at a rapid pace.
Why Tech Companies Love Panama
Having a consumer culture that supports new technology is great, but having a logistics hub in need of streamlining is even better. Panama is all about moving. Moving money, moving cargo, moving people. All of which can be enhanced for efficiency with high-tech solutions. Companies like ABB (Swiss), who specializes in robotics and automation technology, as well as Dell (US), and Ericsson (Sweden), have all made sizeable investments into regional offices in Panama, with many smaller startups coming at a rapid pace.
Panama also now has the space and infrastructure to support these companies. On the site of the former US Fort Clayton in the Canal Zone, now lies Ciudad de Saber. It’s a government-sponsored commercial development built to house tech companies and their staff. It is also home to many higher education subsidiaries, as well as UNICEF, the Red Cross, and UNWFP. By concentrating education, NGO’s, and tech in the same place, Panama is hoping to create an environment where progressive and innovative business can thrive. But this isn’t the only show in town.
The newest Panama tech center, also constructed on a former military base, is attempting to set the bar even higher for high-tech businesses. It’s called Panama Pacifico. Panama Pacifico is located on the west bank of the Canal, about 15 minutes away from downtown Panama City. Built on a massive piece of land that was once Howard Air Force Base, Panama Pacifico is an entirely pre-planned tech city. Think of it like Panama’s version of Silicon Valley. There is space for literally hundreds of companies, as well as residences, schools, shopping, bus terminals, and even a small airport (after all, it was an Air Force base).
While there are many big companies choosing Panama as their target tech destination, it has also become a hotbed for entrepreneurs. While they may not fill the massive office spaces in Panama Pacifico, they operate out of the city, and many employ a local staff, and work intimately with the local market. Whether you’re a multinational, or an idea-man/woman looking for funding, Panama’s got a lot to offer: low overhead, favorable taxes, growing consumer market, and a seemingly unending demand for logistics solutions. And in 2014, we are just scraping the surface of one of the country’s fastest growing economic forces.