Hilton Hotels announces return to Panama

Hilton Hotels Corporation announces return to Panama with four properties
May 18, 09 1:54 am
Hilton Hotels Corporation announces its return to Panama with the signing of four multi-year agreements in Panama City, Panama: two management agreements for a brand-new Hilton and new build Embassy Suites by Hilton hotel, one franchise agreement for a Doubletree by HiltonTM conversion and one franchise agreement for a newly built Hilton Garden Inn. Each hotel will represent the first in the country for each brand.
"We are truly excited about these developments in Panama City and being back in such a great city," commented Daniel Hughes, senior vice president of operations, Caribbean, Mexico, and Latin America, for Hilton Hotels Corporation. "These newest additions reinforce our commitment to add a number of properties to our Central America portfolio and to have a presence in one of the region's fastest growing destinations. We're looking forward to being part of a thriving city that continues to offer some of the best tourist attractions in the region."
The 351-room Hilton Panama will be a first class property developed by Star Bay Group, Inc., and Hilton Hotels Corporation will operate the hotel under the terms of a multi-year management agreement. Led by F&F Properties and its president Saul Faskha, construction of the Hilton Panama has begun and completion is scheduled for 2011. Located in Panama City's financial district, the hotel marks the Hilton brand's return to the capital. Just 13 miles from Tocumen International Airport and five miles from the Panama Canal, the Hilton Panama will boast an array of recreational facilities including an 8,200 square-foot fitness center, a 10,750 square-foot world-class spa, outdoor terrace swimming pool, and a Las Vegas-style casino. The property will have more than 22,000 square feet of meeting space, including a 7,500 square-foot ballroom. Dining options will include an upscale specialty restaurant, a three-meal restaurant with outdoor terrace and ocean views, and lobby bar. The 27-floor hotel will form part of a 68-floor mixed-use complex with 650,000 square feet of office space.
The Embassy Suites by Hilton Panama City will be developed by Sabadell Investment Inc. and Hilton Hotels Corporation will operate the hotel under the terms of a multi-year management agreement. Construction of the 306-room upscale, all-suite full service Embassy Suites by Hilton Panama City is scheduled to begin in 2009 with an estimated completion date of October 2011. Located in the prime financial district of Panama City, the hotel is approximately 12 miles from Tocumen International Airport and will feature a number of recreational facilities including fitness center, spa, outdoor swimming pool, gift shops, and casino. The property will offer a business center and more than 15,500 square feet of meeting space, including a 12,750 square-foot ballroom. Dining options will include a signature restaurant, a lounge bar, complimentary breakfast and evening reception area, and Flying Spoons outlet. The 21-floor hotel will be part of 71-story building with premier office space.
The Doubletree by Hilton Panama City will be developed and operated by Blue Star Hospitality, S.A., under a franchise agreement with Hilton Hotels Corporation. The 213-room property is undergoing an extensive renovation to re-brand as a Doubletree by Hilton hotel in Spring 2010. The eight-story hotel is strategically located at one of the city's most important intersections in the business district - Via España and Avenida Federico Boyd - across from the architecturally striking Iglesia del Carmen. The Doubletree by Hilton Panama City will offer a rooftop fitness center, pool and spa, retail outlets, 2,000 square feet of meetings space, and a full-service restaurant.
Developed by Metropolitan Hotels SA, the Hilton Garden Inn Panama will feature 163 spacious guestrooms and seven suites offering the Garden Sleep System® bed; ergonomic Mirra® chair by Herman Miller; complimentary wired and Wi-Fi high speed Internet access; high definition flat screen television; MP3 capable clock radio. The hotel also features a complimentary 24-hour business center; a comfortable lounge area to enjoy a cup of coffee in the morning or unwind at the end of the day with a refreshing beverage; and a total of 160 square meters of flexible meeting space -- ideal for business meetings, social events and wedding receptions. For dining options, the hotel will feature the Great American Grill® restaurant offering freshly prepared breakfast and dinner; evening room service and the 24-hour Pavilion Pantry® convenience mart with a selection of beverages, snacks, and sundries. Recreational facilities at the hotel will include an outdoor rooftop heated whirlpool; complimentary fitness center featuring Precor® cardio and strength equipment; and Stay Fit Kits® that can be checked out from the hotel front desk and enable guests to do yoga, Pilates and core workouts in the privacy of their guestroom or in the workout facility.
All properties will participate in Hilton HHonors®, the only guest rewards program that allows members to earn Points & Miles® for the same stay and redeem points for free nights with No Blackout Dates.
Ted Middleton, senior vice president, development, the Americas, for Hilton Hotels Corporation commented, "Hilton's expansion in Panama City is part of our overall plan to grow our portfolio of properties in the Caribbean and Latin America. Owners and developers understand the value of our brands and we are very optimistic about our growth opportunities in the region."
Panama City is the political and cultural center of Panama, and the financial center of Central America. Located at the Pacific entrance of the Panama Canal, the city is well known as the home of some of the tallest skyscrapers in Latin America. Tourists can explore a variety of attractions including the famous Bridge of the Americas spanning over the Panama Canal, tropical forests, and the city's old quarter featuring a waterfront promenade, theaters, museums, restaurants, and the presidential palace.
Full text in http://ehotelier.com/hospitality-news/item.php?id=A16245_0_11_0_M

PanamaInvest conferences feature investment opportunities

Panama Invest is a cycle of conferences delivered by the government of the Republic of Panama to potential investors located in key global markets with the aim of disseminating information about business opportunities and attracting foreign investment to Panama. This year Panama Invest will start in Sao Paulo to be followed by Toronto, (Madrid, Tokyo, Munich, Rotterdam and will end with the second edition in the British capital of London.

Thus, under this favorable environment, Panama Invest seeks to showcase a variety of business opportunities for companies interested in setting up their operations in Panama, where the national government has identified important sectors for investment such as maritime services, logistics and transport, mining, tourism, financial services, among others. Moreover, Panama Invest will introduce the strategic function of Panama to serve as platform for the operations of enterprises in the larger Latin American region.

http://proinvex.mici.gob.pa/
http://www.panamainvest2011.com/
http://www.panamainvest.org
http://www.mici.gob.pa
http://www.impulsopanama.gob.pa/
http://www.camarabrasilpanama.com.br
http://es-es.facebook.com/pages/Agencia-de-Inversiones-de-Panam%C3%A1-PROINVEX/165595976815571
http://www.facebook.com/profile.php?id=100001526002538&ref=ts

Can Panama Become the Singapore/Rotterdam-style Hub for Latin America?

at 11:25 am by David

• Keynote: H.E. José Domingo Arias, Vice Minister of Commerce and Industry, Panama
• Keynote: Philip Yeo, Chairman, SPRING Singapore, Special Adviser for Economic Development, Prime Minister’s Office (view background presentation)
• Keynote: Frank Heemskerk, Member of the Board of Management, Royal Haskoning
• Moderator: Don Ratliff, Executive Director, Georgia Tech Panama Logistics, Innovation & Research Center

Frank Heemskerk: Happy to see economic relations between Panama and Netherlands growing stronger. President Martinelli is visiting Netherlands this year, discussing how to avoid double taxation between the countries. These have been some of the fastest negotiations ever.

Location is important, but it needs to be maintained and shared. The Netherlands’ success is a combination of location, business/tax climate, and quality of life. Education is very important and people want the best environment for their children. Freedom of press and freedom of speech — this is what people want. The Netherlands has met these goals and this the reason for their success.

Panama outpaces the Netherlands on GDP growth, but this an advantage to the Netherlands and to Singapore as it creates more wealth and more trade for the entire world.

José Domingo Arias: Panama has been developing it’s place as a trade and logistics hub for 400 years, starting with the gold trade from the continent’s Pacific coast to Spain. Terms have now changed. Trade comes from the west of the United States and travels to the east.

The Canal will expand its capacity to be able receive bigger ships. This takes a great deal of investment. Panama is already the eleventh most competitive country in the world, and offers the most efficient and competitive port in the Western Hemisphere. The free trade zone of Colon moves $20 billion in trade a year. The airport Tocumen is seeing 12 million passengers per year and expected to see this grow to 14 million. The government is also in the process of building the highway between Panama City and Colon and extending the highway across the country. The most important thing is that the government is doing all this with global commercial partners.

We are focusing on developing teaching and education in Panama, especially executive education. Most of these students are from the public sector. Our long term project is to renovate the country’s entire education system. Our private partners and universities have the capacity to identify their needs are and will handle their training.

Experience exchange with Singapore and the Netherlands is vital for us. We have studied their model. We are learning enormous amounts from Singapore in terms of technology, a field in which they have considerable experience. Someone from the private sector asked me what guarantees we could provide that we can deliver. Our prestige is on the line, and our style of the administration is to get things done.

Panel conversation: Success comes from collaboration of the private sector, the public sector, and investigations. The impressive thing about Singapore is they never stop trying to be the best, even though they are considered by many to be the best. Panama is trying to encourage entrepreneurship. How can it encourage creating a “critical mass” of ideas?

Will East coast U.S. ports on the East Coast be able to handle new big ships that will be passing through the expanded Canal? If not, this will be to Panama’s advantage as it mean ships will be unloading their cargo, although the United States will catch up eventually.

Panama is more of a logistics hub than a trade hub. Panama needs to build on this and improve. Suggestions include broadening the agenda using better social policy and better water management. Singapore and the Netherlands have been able to convince shippers of the value of going through Rotterdam’s and Singapore’s ports. They’re efficient, tariffs are cheaper, and they’re easier to use. Panama should follow these models.

More in http://www.as-coa.org/blogs/panama2011/

24 Feb 2011: Panama - Where the World Meets

PANAMA
WHERE THE WORLD MEETS

Thursday, February 24, 20118:00 a.m. to 3:45 p.m.Registration: 8:00 a.m. to 8:30 a.m.Presentation: 8:30 a.m. to 3:45 p.m.
Panama Marriott HotelSalon Campo AlegreCalle 52 y Ricardo AriasPanama City, PanamaMap of location

Panama is set to continue growing at one of the fastest paces in Latin America. For 2010, Panama’s growth is expected to be 7 percent, and the IMF and UN forecast the country will lead GDP growth in the region over the next five years thanks in part to its public investment plans, which is close to $20 billion for the 2009 to 2014 period. More than 40 multinational headquarters have moved their regional operations to Panama due to its economic and political stability and have taken advantage of its strategic position and government incentives to attract investment. By continued strengthening of its logistics sector, Panama may be well positioned to become the Singapore-style hub for Latin America, providing foreign investors with a high-standard regional platform to develop its products and services in order to reach other markets.
For the second consecutive year, AS/COA, together with the World Bank and the government of Panama, is organizing a conference to provide an in-depth analysis of these issues. This year, the conference will be focused on the country’s economic prospects and the efforts and challenges to improve its competitiveness in the logistics sector.
Please join us as we address these issues with a group of internationally recognized senior business executives, government officials, economists and investment analysts.
CONFIRMED SPEAKERS:
Ricardo Martinelli, President of Panama
Demetrio Papadimitriu, Minister of the Presidency, Panama
Alberto Vallarino, Minister of Finance and Economy, Panama
Roberto Henríquez, Minister of Commerce and Industry, Panama
Alberto Alemán Zubieta, CEO, Panama Canal Authority
Edgar Blanco, Research Director, Center for Transportation and Logistics, MIT
Tanya Avellán, Director, Central America, Coca-Cola FEMSA
Frank Heemskerk, Member of the Board of Management, Royal Haskoning
Samuel Israel, CEO, Latin America, DHL Global Forwarding
Felipe Jaramillo, Central America Director, The World Bank
Sergio Luna, Vice President, Department of Economic and Sociopolitical Research, Citi Latin America
Rubén Ramírez, Representative Director, Panama, CAF
Don Ratliff, Executive Director, Georgia Tech Panama Logistics, Innovation & Research Center
Stefan J. Roehr, Director, Latin America Supply Chain, Sanofi-Aventis
Jordan Schwartz, Lead Infrastructure Economist, Latin America and the Caribbean, The World Bank
Peter V.A. Shaw, Regional Credit Officer for Latin America, Fitch Ratings
Carlos Urriola, General Manager Manzanillo International Terminal and Senior Vice President, Stevedoring Services of America
Philip Yeo, Chairman, SPRING Singapore, Special Adviser for Economic Development, Prime Minister’s Office (view a background presentation on Singapore’s economic development)
Susan Segal, President and CEO, Americas Society and Council of the Americas
ACCESS THE AGENDA.*

To register go to http://www.as-coa.org/blogs/panama2011/

Panama as Regional Business Hub

Because of the geographical position of Panama, located in the center of the American Continent, with access through land, sea and air, with a tropical year round climate, free of natural disasters. With an open service economy, capable human resources, dollarized economy, the international finance center, world class logistics platform and economic political and social stability, make Panama the ideal site for making businesses in the region.

WHY INVEST IN PANAMA?

Panama is a country with a service vocation, that possesses a privileged geographical location, that has allowed us to become one of the most important logistic centers of the Western Hemisphere for the storing and distribution of world cargo, a bridge for the mobilization of passengers to the entire American Continent and facilitator of efficient and modern communication services. As a commerce promoter, both nationally and internationally, Panama enjoys political, social and economic stability.

Panama has gone from being a bridge to becoming a logistic platform by air, sea and land, with the Panama Canal as main axis, transporting over 300 million of CPSUAB (Container, Bulk, etc.) presently serving more than 14,000 ships through 144 maritime routes and complementing with a system of container terminals in the Pacific and the Caribbean, that serve as cargo transship and redistribution, that recorded an annual movement of containerized cargo of 4.25 million TEU's, added to the inter-oceanic railroad that has a capacity 330,000 containers per year from one coast to anther. Panama also has the Colón Free Zone, the most important one in the Western hemisphere, with an annual trade exchange of over 19 thousand million dollars through its approximately 3,000 companies established in the Colón Free Zone. The development of the Panamá Pacífico Special Economic Area, in the former Howard Air Station, will serve as a space destined to the production of goods and high technology services.

We offer an efficient air service through the Tocumen International Airport, presently undergoing a remodeling process for offering a comfortable and safe atmosphere to all the travelers that visit our country and an expeditious and efficient attention to the transiting passengers, who do not go through customs or migration checks. From the airport the Copa Airline operates its Hub that offers more than 46 destinations to 25 countries in America and excellent connections, some of them with three daily flights to the most important cities of Latin America. In addition we account for with an excellent internal offer of direct flights to the principal cities of the interior of the country.

Panama has become the preferred center for the installation of five submarine optical fiber cables, turning into the ideal place for telecommunication companies and data centers since we have the advantage of offering great connectivity with North and South America, Europe, Asia and the Caribbean, advantages that companies have learned to use effectively, such as MCI, Cable & Wireless and Movistar that offer cellular telephony services and first quality internet to the international market.

Our prestigious International banking Center, with over 93 internationally renowned banks, reflected for the first Quarter of 2010, assets in the order of US$ 65,000 millions.

Our medical and health services are well known internationally and they have the two best private hospitals of the Central American region; equipped with the most recent medical technology, and they are affiliated to world famous hospitals such as the Baptist Hospital in Miami, Florida and the Johns Hopkins Medical Center in Baltimore, Maryland.

Our tropical climate and varied tourist offer sets us among those preferred for the travelers that can find in our country picturesque indigenous and colonial communities, white sand beaches and coral reefs with indescribable beauty, mountains with fresh climates and tropical jungles with an exuberant vegetation, habitat of innumerable flora and fauna species. And with our excellent highway network and short distances the country can be toured in only six hours.

For these reasons, Panama has been chosen by important multinational companies such as Samsung Electronics, Inc., DHL, DELL, Hutchinson Port Holding Group, HSBC, BICSA, SCOTIABANK, Assicurazioni Generali, American Life Insurance Company and many more, as main offices for their regional operations. In addition, some of the most recognized International Organisms such as UNICEF, UNDP, OAS, the Spanish Agency for International Cooperation (AECI, initials in Spanish), and the BLADEX [Latin American Export Bank] among others, have chosen Panama for establishing their operations.

Panama offers goods and services at reasonable prices as compared to its nearest neighbors, with Free Trade Treaties (TLC, for initials in Spanish) with Taiwan, El Salvador, Singapore and Chile. Furthermore, we are going through the final negotiations of a TLC with the United States and Central America and we are preparing our entrance in the G-3.

http://proinvex.mici.gob.pa

Superintendent receiving comments on new bank application

The Superintendent of Banks of Panama has opened a period of 30 days for comments to the banking and trustee licenses applications filed by UNI B & T HOLDINGS, INC. for UNI BANK & TRUST, INC. The directors of UNI B & T HOLDINGS, INC. are:

JOSEPH SALTERIO
HERMAN BERN
MAYER MIRO YOHOROS
MOUSSA ATTIE
DAVID BTESH NAHMAD
IMAD ISSA
MORDECHAI ASHKENAZI
MOISES AZRAK AZRAK
DANIEL LEVY AZIZIAN
SION COHEN

In accordance with the provisions of Executive Order No.16 of October 3, 1984, objections to the Trust and Banking License applications must be submitted to the Superintendency of Banks within thirty (30) days after the last publication of this notice in a newspaper of national circulation. Objections must be RECEIVED before APRIL 20 at:

Superintendencia de Bancos

Avenida Samuel Lewis, Torre HSBC - Pisos 1, 2, 8, 9, 17, 18
Apartado 0832-2397

WTC, Panamá, Rep. de Panamá
superbancos @ superbancos.gob.pa

.

March 3-5: EXPOCOMER helps start your Panama business network

The Panama trade fair EXPOCOMER has a free online B2B database of visitors and exhibitors attending the exhibit in March to meet on a one-to-one basis. This is an event attended by thousands of buyers from throughout the Americas and exhbibitors from as far away as Malaysia and both Chinas.

Keep in mind that international hotels may have no vacancies during those days so early reservations are a must. However, independent hotels and relocation companies can help you get lodging in Panama City during those days.

---

EXPOCOMER - organized by the Chamber of Commerce, Industry and Agriculture of Panama - is the largest, annual horizontal, international exhibition in Panama.

The event is to be held as below:
Date: 3^rd – 5^th March, 2010 (1.00 p.m. to 8.30 p.m.) B2B only
6^th March (11.00 a.m to 8.30 p.m.) General & trade

Venue:Atlapa Convention centre, City of Panama

Panama has a strategic geographic location, has a modern international banking centre also and the largest duty free zone in the western hemisphere. The last edition of fair had 481 exhibitors from 28 countries attracting 16,213 visitors where 9000 business match making were done.

EXHIBITORS PROFILE

This is a multi-sector trade exhibition. The main categories are:
· Textile: cotton, linen & silk fabrics, home & fashion textiles, table cloths, decorative textiles, decorative embroideries, handbags, leather products, jewellery, perfumes & cosmetics
· Food: Packed food, beverages, liquor, tobacco
· Construction: construction, equipment, material, hardware, manufacturing machinery, raw material
· Technology: computer & communication technology, transportation equipment, automobiles, medical, pharmaceutical, laboratory equipment & products.
· Services: all type of service providers related to textile, food, construction & technology

VISITORS PROFILE

Visitor categories would include:

· Importers, wholesalers & re-exporters
· Supermarket chains & retailers
· Business Houses
· Industry Professional
· Trade Associations
· Service providers

EXPOCOMER is the ideal place for company to exhibit products and services to local and regional markets, introduce new products to the market, evaluate the competition and use the Colon Free Trade Zone as a bridge to re-export products to the Caribbean, Central America and South America.

FREE online registration as Buyer http://www.expocomer.org/index.php?tu=comp&ci=4

Online registration as Exhibitor http://www.expocomer.org/english.html?js=1

Download Free Expocomer Information Package http://www.expocomer.com/alex/FILES/Brochure_Digital-Expocomer_2010.pdf

India Participation in Expocomer http://fieo.org/view_section.php?lang=0&id=0,548,550
In case you are interested, you are requested to send us your interest by sending us the enclosed form along with a Demand Draft of Rs 85,000/- in favour of Federation of Indian Export Organisations payable at New Delhi. The participation charges are non refundable once the participation is approved. For any clarification, you may contact MRD Division at 011-46042114 & 46042136-38, 46042222 or email at mailto:anandseth.fieo@gmail.com; prashantseth@fieo.org

Israel returns to Expocomer http://en.centralamericadata.com/en/article/home/Israel_Interested_in_Panama

Panama mortgages reach the $4.85 billion mark

Panama financial weekly Martes Financiero www.martesfinanciero.com

features a series of articles on real estate. Interesting numbers
tell us that:
* The first half of 2007 closed with $4.85 billion in mortgages, led
by Banco General ($0.98), Continental ($0.59, later acquired by
General), HSBC ($0.55), Banistmo (acquired by HSBC), and Banco
Nacional ($0.51).
* They are followed by Caja de Ahorros ($0.45), Scotiabank ($0.20),
BBVA ($0.18), Banvivienda ($0.17) and Credicorp ($0.09).
* Risk analysts point out that banks have increased their mortgage
exposure from 15 0/0 in 2003 to 21 0/0 in 2007.
* S&P analyst Angela Bala says that condo prices have reached very
high levels based on speculation from sale to foreigners, so Panama
banks face the risk of a "possible" mortgage crisis.
* These priced are not based on a local buyer who is unable to pay
$3000 per square meter.
* Despite the real estate boom, Panamanians face a housing shortage
of 160 thousand homes, down from 178 thousand in 2006.
* A square meter of Pacific beachfront costs $2,300.00.
* Investment by developers in Altos del Maria is of $20 million.
* Investment by developers in Malibu will be of $400 million for 1200
houses and 800 condos, with 80 o/o destined to the foreign market.
* In San Francisco, the price of a square meter of land ranges
between $800 and $1500, while in next-door Parque Lefevre they range
between $200 and $900. Middle-class Pueblo Nuevo has parcels between
$80 and $120 a square meter.
* The 2004 Panama Structure Regulations increased the anti-seismic
features - along with the cost - of high-rises.
* Monthly salaries of construction workers range from 2 times the
$300 minimum wage to $1200.
* Inmobiliaria San Felipe has 83 shareholders and has restored 50
apartments and 13 commercial spaces in Casco Viejo, for $6 million since 1995.
* Inmobiliaria San Felipe has 30 proyects in the pipeline and is
planning its IPO.
* The price of the square meter of land in Casco Viejo has increased
from $1000 to $2400, due to the demand from foreigners.
* Foreign competitors entering the market are Shyreen Deer Company
under Kurt Kisto with a $30 million investment in units of $50K and
Adsum Group with an $18 million office building sold at $2,200-2,600/
square meter.
* Only properties with occupation permits registered before August
31, 2007, qualify for 20 year property tax exemptions. Others have
lower tax holidays of 15 years or less.

The full text is available in

http://www.martesfinanciero.com/history/2007/09/04/index.shtml

Panama City Office Market View

CBRE Panama has an interesting report on the office building market with numbers from the 2006 market:

Panama has experienced a strong recovery and real estate market activity has rebounded in 2006.

Although a significant volume of new Class A buildings were delivery to the market in the first quarter of 2006, lease rates and sales prices have remained relatively stable and are expected to increase once the available space is absorbed.

Construction activity remains strong in the residential market, but has slowed the price in commercial spaces. Panama is steadily positioning itself as a top second home or retirement haven for foreigners within the region. The positive result of a nationwide referendum about the ambitious Panama Canal expansion project has attracted the attention of international companies for related business and offshore relocations.

Furthermore, economic growth projections accounting this project are 2% higher than former estimates.

The Class A office buildings that have been delivered on the first semester, doubling the existing stock have been relatively fast absorbed.

At present, there are few buildings in construction, and in planning stage.

Although inflation and oil prices increased since last year, the Panamanian economy grew of 6.5%.

Panama maintains the best performance of Central America in Foreign Direct Investment (FDI) for the fifth consecutive year, and figures among the top 10 recipients in Latin America.

The overall economic growth in fueled by and increase in tourism, exports of non-traditional products, Free Trade Zone at Colon, and the Panama Canal project expectations.

The construction of the Port of Farfan and the reopening of the former military airport of Howard, both located in the Panama Pacific logistics zone at the west of the city are starting. Dell and other tenants already out of this area, and Singapore Technologies Aerospace is establishing an aircraft maintenance facility. Call center activity, plenty of fiscal incentives, is also strong, and now complemented by back office facilities coming offshore.

Given the current stable political and economic conditions, prospects for Panama�s office market remain positive.

Things may have changed in 2007 but the outlook remains positive. The full text of the report can be downloaded from http://www.cbre.com.pa/PDFs/Panama3q06Ofc-Eng.pdf

THE ECONOMY: Excessive wealth fails to filter down to the poor

By Adam Thomson

Tuesday Jul 24 2007 07:10

It is early evening on a Wednesday night but Manolo Caracol is buzzing just the same. A group of more than 20 well-dressed Panamanians fills one side of the spacious, ethno-chic restaurant, and the sangria at their table has been flowing for a while. To the left, against a backdrop of primitive oil paintings and oversized buckets brimming with tropical fruit, a young woman cooks furiously while waiters skip between the tables in an attempt to keep up with demand.

Not so long ago, you could turn up unannounced at this cool, Colombian-owned restaurant in the best part of Panama's historic centre and be confident of getting a table. Doing that today might lead to disappointment: Panama's economy is expanding at the fastest rate in almost a generation, and business is booming virtually everywhere you look. "We're experiencing growth across the board, not just in one particular sector," says Héctor Alexander, Panama's finance minister.

During the first quarter of this year, the country's fully-dollarised economy expanded at an annual rate of 9.4 per cent after growing 8.1 per cent during 2006, and both government and private-sector estimates suggest that the end-of-year figure will surpass 10 per cent.

Exports grew 15.1 per cent last year in nominal terms, and strong growth in government revenue – during the first quarter of this year it was expanding at more than 19 per cent year-on-year – helped notch up a non-financial public sector surplus equivalent to 1 per cent of gross domestic product. In the financial sector, credit is growing apace and levels of capital and reserves are building up fast.

Crucially for Panama's newfound dynamism, prime lending rates are below 9 per cent, the lowest in years.

One clear motor driving growth is the robust world economy – in spite of the US deceleration – and in particular, the heady expansion of the global shipping trade. That has boosted activity for the canal by between 5 and 6 per cent in recent years. It has also spawned the growth of related sectors such as tourism and rapidly expanding re-export trade. According to Samuel Lewis, the vice-president, the movement of shipping containers this year through Panama will reach 3m units, up from just 700,000 at the start of the millennium. He expects that figure to increase to 7m by 2009.

Guillermo Chapman, an economist and a former finance minister, describes the second engine of growth as a sort of "the world has discovered Panama" phenomenon. The country's geographical location, stable political system, the dollarised economy, still relatively low levels of inflation – the rate has fallen slightly since reaching a two-decade high of 3.9 per cent in 2005 largely as a result of high oil prices – and benign interest rates have spawned a wave of foreign direct investment. Mr Chapman says FDI this year is set to hit $2.5bn up about 20 per cent on last year.

The most obvious sign of this is in construction. Look out from the 19th century waterfront buildings of the capital's historic quarter across the bay and the rate at which the skyline is changing suddenly becomes apparent.

Another is the sparkling sports cars and shining SUVs that fill Panama City's already crowded streets. Drive down Balboa Avenue, the road that links old and new Panama City, and you will see the latest Lexuses and Lamborghinis vying for space with fat-tyred Fords and Toyotas.

The trouble is that this ostentatious wealth is not quite everywhere. Look beyond the investment figures, glass skyscrapers and the fancy restaurants and poverty more reminiscent of the seamier side of Haiti comes into view.

In Panama City's old neighbourhood, wizened men eke out a living selling loose cigarettes from roadside stands improvised from cardboard boxes and planks of wood. Families live in dingy, airless rooms that, as often as not, serve as kitchen, sitting room and bedroom all in one. Go out into Panama's lush tropical countryside and it is a similar – and sometimes even more miserable – story.

"The gap between rich and poor here just gets wider," argues Miguel Antonio Bernal, a well-known lawyer and critic of the government. "Sure, there's growth but none of it filters down to the poor." Mr Bernal insists, for example, that unemployment is running at between 20 and 23 per cent of the country's economically active population.

The administration of President Martín Torrijos dismisses such assertions, insisting that the percentage of jobless is more like 6 per cent, a historic low. But it does recognise that many Panamanians continue to live in extreme poverty. The government also says it is working overtime to try to solve the problem. Mr Lewis insists that the Opportunities Network, providing a direct subsidy of $35 a month to families that can show that their children attend school regularly and turn up to doctors' appointments, is making a significant difference for 38,000 of the 78,000 families it claims live in extreme poverty. By 2009, when the administration's term ends, Mr Lewis claims the remaining families will be receiving similar help.

Two further shadows – the fear of a bubble in the vigorous property market and a slowdown in the global economy – could also loom in the coming months and years. Mr Chapman believes that a continuing softening of the US housing market would be likely to produce less demand from US baby boomers who have been snapping up retirement homes and second properties in Panama.

Meanwhile, Mr Chapman points out that a change of fortunes in the global economy is simply a question of time – though exactly when that will happen is clearly guesswork. So what does all that mean for Panama in the medium term?

With no clear sign of an impending slump in world growth and with China's emergence as an economic superpower continuing to underpin shipping activity – China is now the second most important client of the canal after the US – many private economists believe that the country can maintain growth rates of between 6 and 7 per cent. It is a rate that almost any government in the world would be more than pleased with.

Full text and subscription at http://us.ft.com/ftgateway/superpage.ft?news_id=fto072420070720116044.

Panama becomes Latin America's newest boomtown

Panama on the rise

Construction, global interest booming, eclipsing long-range worries

By Indira A.R. Lakshmanan, Globe Staff December 27, 2006

PANAMA CITY -- Long a freewheeling shipping hub and offshore banking center for the Americas, Panama is enjoying a building boom on a scale unmatched since the construction of its famous canal 92 years ago.

The country is luring investors and expatriates worldwide, with interest further boosted by the recent approval of a $5.2 billion plan that will double the canal's capacity.

A real estate frenzy fueled by easy credit from Panamanian banks, government incentives, and a saturated US housing market for retirees has attracted speculators and prospective residents from California to Dubai. They are snapping up preconstruction bay-front apartments, highland villas, and the latest luxury development from Donald Trump -- a $220 million residential, office, and hotel complex called Trump Ocean Club, with towers shaped like a yacht sail. Two rival Spanish projects are vying to build the tallest skyscraper in Latin America at about 100 stories.

Construction moguls and estate agents say Panama City is a sure bet for investors, offering discount prices for quality of life and healthcare rivaling the United States', more than 100 international banks, tax breaks, and stunning Atlantic and Pacific coastlines.

But urban planners and long time residents warn that overbuilding could ultimately strain the country's roads, water supply, and other infrastructure to the breaking point with devastating consequences.

Almost no one seems to be heeding those alarms.

Cranes, building sites, glitzy sales offices, and real estate package tours aimed at foreigners are everywhere, from Avenida Balboa in downtown Panama City to suburban Punta del Este. Laundered drug money from neighboring Colombia built some of the early mirrored high-rises in the 1980s, but today's buyers include fixed- income senior citizens from the United States searching for a less expensive place to retire as well as billionaires from Monaco and Cannes.

David Btesh, a partner in Pacific Point, a high-end condominium project under construction on a landfill in downtown Panama City with units ranging from $300,000 to $1.1 million, said foreigners are looking for a haven from a world they perceive as unsafe because of crime at home and global terrorism.

"They're not going to Europe because it's too expensive, Canada's too cold, and Mexico's only Spanish-speaking," while many Panamanians speak English, Btesh said.

"Panama is a dollar economy with a democratic government. There's every kind of food, a modern airport with about 54 flights a day, and the second-largest free-trade zone in the world after Hong Kong," he said.

US citizens represent two-thirds of foreign resident visas issued in Panama in recent years, officials say, with at least 1,379 Americans moving to the country since 2003. Celebrities from Mick Jagger to Bono reportedly have purchased property in resort areas outside the capital.

The canal, central to the country's history, also looms large in the current boom.

The United States supported Panama's declaration of independence from Colombia in 1903 in exchange for US control of a canal connecting the Atlantic and Pacific oceans. In 1914, the US-built canal was completed, and the zone remained under US control until 2000.

In October, a majority of Panamanians voted to finance the construction of a third canal lock over the next decade that will allow the 50-mile lock and lake system to accommodate bigger ships and double toll revenues within 20 years, according to government estimates. Ricuarte Vásquez, minister for canal affairs, said the referendum "is a vote of confidence" in the local administration of the canal that has raised interest in Panama as an investment destination.

About 107 residential building projects of at least 20 stories, valued at $3.2 billion, are under construction in metropolitan Panama City, according a survey by Prima Panama, a real estate promotion company. That construction activity accounted for one-fifth of Panama's annual gross domestic product.

The report also found that about 11,000 apartments are scheduled for completion within four years -- the same number that were built over the past 11 years in metropolitan Miami, by comparison, where a glut has softened the market. The survey found that the average price of a new condo in Panama City is $289,111.

The cost has raised concerns about who will be able to afford to live in Panama.

Some will be the jet-set buyers targeted by the Trump complex, which is selling preconstruction condos from $400,000 to $8.7 million. The K Group, local developers of the project, says Americans including Trump, top the list of buyers at about 40 percent, followed by Canadians, Europeans, and Latin Americans.

Other buyers are expected to be baby boomers from the United States seeking more value for their retirement money. Modern Maturity magazine ranked the town of Boquete, in Panama's highlands, as one of the world's top retirement destinations.

Kit Marchel, a 35-year-old real estate investor, said she sold her Los Angeles condo last year for $3.3 million and bought an 8,000-square-foot villa at a southern Panama beach for $335,000. Since then, she has acquired 17 properties in resort areas and the capital, with plans to resell, rent, or redevelop them.

"The communications work, you can drink the water from the tap, there's no currency exchange issue, and it feels a lot like home," she said. "I've made a commitment to this country. . . . I did my research first. There's one baby boomer retiring every six seconds -- add those numbers up."

But a question nagging even the bullish is whether public services and demand can keep up with rising supply and prices. Already the capital suffers from traffic jams and fumes from untreated sewage that is dumped into Panama Bay. Public transport is sorely lacking, and the water supply is insufficient in poor neighborhoods.

"It's a time bomb -- you cannot meet the demand of all these high-rises with the infrastructure that exists," said urban planner Jorge Ricardo Riba, a former top official with the National Planning Office. "What happens when people start to live there?"

If the US economy weakens, he said, "there may not be enough buyers. I see a lot of empty apartments in the future."

Sandra Snyder, an American relocation consultant in Panama City who has written two books about expatriate life in Panama, also worries that the country's infrastructure cannot keep up with the pace of building. "This is such a lovely place, and I hate to see what's happening with this frenzy of building," she said.

A few developers say they are looking beyond the quick buck and want national and local officials to forestall problems before they arise.

José Bern of Empresas Bern, a hotel and real estate giant, said his biggest problem is finding workers to complete his projects on time and within budget. Panama City "is experiencing some growing pains, and it will get worse before it gets better," he said. "But maybe that's good, to slow things down."

Sarah Cox, a consultant with International Living, a publishing and seminar company, says the government has promised a new bridge, a wider main artery, a revamped bus system, a waste-water treatment plant, and a cleanup of the bay.

Cox acknowledges that speculation and overbuilding could bring down Latin America's new boomtown. But for now, she said, "I don't see that they'll stop building until people stop buying. . . . It's like picking up dimes in front of a steamroller. As long as you can stay ahead of the steamroller, you're fine."

http://www.boston.com/news/world/articles/2006/12/27/panama_on_the_rise/